Operating your business is only half the battle in getting customers to purchase your products. After a customer purchases a product, you still need to get the item or items to him. Unfortunately, carriers have made figuring out best practices and freight pricing difficult, but you can simplify the process if you know how to distinguish different modes of shipping, when to use less-than-truckload (LTL) shipping, and how combining LTL shipping with other modes of shipping will provide the greatest benefit.
Understanding the Different Modes of Shipping.
There are three standard modes of shipping, and each mode of shipping is based on the size and packaging of your shipment. Although LTL shipping maybe your ultimate goal, you need to know how each type of shipping varies.
- LTL shipping is used for packages that typically weigh between 150 and 10,000 pounds. Less-than-truckload shipments are usually transported by smaller trailers than a full-size semi, and LTL shipments are usually shrink-wrapped in pallets. This allows for rapid loading and unloading of shipments, which may result from multiple stops and adjustments when in transit. As a result, LTL shipping focuses on combining multiple shipments from different companies into one truck. Yet, the shipments are too large to be reasonably sent by small package.
- Truckload (TL or FT) shipping is similar to LTL, but the whole trailer is devoted to a single shipment. TL is commonly used for shipments over 10,000 pounds between two destinations only, reports Chelsea Camper of Burris Computer Forum. This can be a critical part of achieving rapid Freight distribution from manufacturer to distribution center to regional locations.
- Small package shipments are routinely reserved for orders that weigh less than 150 pounds. For example, the individual items on a UPS truck for neighborhood delivery would be considered small package, but even UPS offers LTL services. Unfortunately, small package shipping directly implies that many different packages from multiple shippers to different customers will be located close to one another. As a result, the risk of damage or errors in delivery, loading or unloading can be greater for small package delivery.
When to Use LTL Shipping.
The decision to use LTL revolves around your budget and determining how quickly a shipment needs to arrive at the destination. The key to differentiating when to use LTL and when to use full truckload focuses on how many individual shipments are needed. If a shipper is sending two pallets from point A to two or more destinations, LTL may be the best option. However, advancements in freight consolidation are being used to transform at LTL into a form of TL for nonrecurring, long-haul shipments.
When to Use a Combination of TL and LTL.
Occasionally, a combination of the modes of transportation may be needed in order to take advantage of less than truckload shipping. Shippers may obtain a one spot position to ship larger quantities in excess of 10,000 pounds by truckload. However, the distribution network will diverge at some point, and the shipper needs to know when the appropriate time to transition from one mode to another will be best.
Imagine a distribution network that covers the western half of the U.S. The manufacturing center is located in Phoenix, Arizona, but smaller distribution centers are set up in the capitals of each state. Since the manufacturer is only launching a test product, it would be impractical to agree to long-term use of TL. However, the cost of using LTL to ship from Phoenix to approximately 20 state capitals is much higher than using freight consolidation in TL for one-stop shipments. As a result, a shipper may use freight consolidation through TL to get products along the same route to various distribution centers in each respective capital.
At this point, the shipper may transition from consolidated TL to LTL shipping. The process can continue Ward small package shipping for final delivery. Since many shippers may operate in local markets, the need to carefully compile all potential rates is critical to truly taking advantage of LTL shipping.
Another example of the benefits of using a third-party logistics provider to determine and manage all LTL shipping would be shipping to Amazon for resale. According to Amazon, all incoming shipments must be on pallets and shrink-wrapped, and all orders must have an accessible bill of lading at the time of delivery. Each of these processes can be completely managed through an appropriate transportation management system, such as the Cerasis Rater.
LTL best practices are simple. Shipments that would typically go through LTL and require a long haul will benefit most from freight consolidation through TL. LTL is best for short-haul of high-volume shipments that do not meet criteria for FT. Last-mile delivery should only take place through small package, but you may need to use LTL to get packages of similar destinations to the small package distributor. Ultimately, you need to think about distance and size of shipment thinking about the best way to use LTL shipping.