Less than truckload shipping
Less than truckload shipping (LTL) is the transportation of relatively small freight. The alternatives to LTL carriers are parcel carriers or full truckload carriers. Parcel carriers usually handle small packages and freight that can be broken down into units less than 150 pounds (68 kg). Full truckload carriers move freight that is loaded into a semi-trailer. Semi trailers are typically between 26 and 53 feet (7.92 and 16.15 m) and require a substantial amount of freight to make such transportation economical.
- 1 LTL carrier operations versus full truckload operations
- 2 LTL operations versus parcel carrier operations
- 3 Preparing shipments for LTL carriers
- 4 Intermodal transportation of LTL shipping
- 5 See also
- 6 References
LTL carrier operations versus full truckload operations
LTL shipments typically weigh between 151 and 20,000 lb (68 and 9,072 kg). Less than Truckload carriers use "hub and spoke" operations where small local terminals are the spokes ('end of line') and larger more central terminals are the hubs (also called Distribution Centers or DC's). Spoke terminals collect local freight from various shippers and consolidate that freight onto enclosed trailers for transporting to the delivering or hub terminal where the freight will be further sorted and consolidated for additional transporting (also known as linehauling). In most cases, the end of line terminals employ local drivers who start the day by loading up their trailers and heading out to make deliveries first. Then when the trailer is empty they begin making pickups and return to the terminal for sorting and delivery next day. Because of the efficiency of this order of operations most deliveries are performed in the morning and pickups are made in the afternoon. Interestingly, LTL carriers most often miss pickups for shippers who are located closest to local terminals.
Pickup/delivery drivers usually have set casual routes which they travel every day or several times a week, so the driver has an opportunity to develop a rapport with his customers. Once the driver has filled his trailer or completed his assigned route, he returns to his terminal for unloading. The trailer is unloaded and the individual shipments are then weighed and inspected to verify their conformity to the description contained in the accompanying paperwork. All LTL freight is subject to inspection or a common abbreviation is S.T.I. for this purpose, though not all freight is inspected. Next, the freight is loaded onto an outbound trailer which will forward the freight to a breakbulk, a connection, or to the delivering terminal. An LTL shipment may be handled only once while in transit, or it may be handled multiple times before final delivery is accomplished.
Transit times for LTL freight are longer than for full truckload freight (FTL). LTL transit times are not directly related only to the distance between shipper and consignee. Instead, LTL transit times are dependent upon the makeup of the network of terminals and breakbulks that are operated by a given carrier and that carrier's beyond agents and interline partners. For example, if a shipment is picked up and delivered by the same freight terminal, or if the freight must be sorted and routed only once while in transit, the freight will likely be delivered on the next business day after pickup. If the freight must be sorted and routed more than once, or if more than one linehaul is required for transportation to the delivering terminal, then the transit time will be longer. In some instances the LTL freight has up to 10 days of delivery time frame. Also, delivery to beyond points or remote areas will almost always add days to the transit time.
The main advantage to using an LTL carrier is that a shipment may be transported for a fraction of the cost of hiring an entire truck and trailer for an exclusive shipment. Also, a number of accessory services are available from LTL carriers, which are not typically offered by FTL carriers. These optional services include liftgate service at pickup or delivery, residential (also known as "non-commercial") service at pickup or delivery, inside delivery, notification prior to delivery, freeze protection, and others. These services are usually billed at a predetermined flat fee or for a weight based surcharge calculated as a rate per pound or per hundredweight.
Integrating FTL and LTL carriers for shipper cost savings
Shippers with enough volume of LTL freight may choose to use a full truckload carrier to move the freight directly to a break-bulk facility of an LTL carrier. For example, a North Carolina shipper with a large quantity of shipments bound for Western US States (for example, California, Nevada, Oregon, Washington, and Idaho) may be able to realize significant cost savings by having a FTL carrier, known as a linehaul carrier, transport the freight to a break-bulk facility in a central location near the ultimate destination of the freight (in this example, delivery to a break-bulk facility in California for parceling out into LTL lots for transport to the final destinations). The use of an FTL carrier to transport this freight generally provides an overall cost savings because the freight will travel fewer miles in the FTL carrier's network, as well as a reduced overall fuel surcharge cost—that is, one FTL carrier travels the distance to the break-bulk facility for a single carrier's price while using only the fuel required for that FTL truck, vs. several LTL carriers at each carrier's price, each covering some of the same path to the final destinations and each using the fuel required for each one of the LTL trucks. A further benefit is realized in both loading cost and product damage because the freight will not need to be unloaded and reloaded as many times. Additionally, this reduces the incidence of loss and the opportunity for pilfering or theft, because all of the freight travels together and is not broken down into LTL loads until it reaches the break-bulk distribution facility.
LTL operations versus parcel carrier operations
Parcel carrier operations
A parcel carrier traditionally only handles pieces weighing less than approximately 150 pounds (68 kg). Parcel carriers typically still compete with LTL carriers by convincing shippers to break larger shipments down to smaller packages. Parcel carriers typically refer to multipiece shipments as "Hundredweight" shipments as the rating is based on 100 pounds (45 kg). The Hundredweight rate is multiplied by the shipment's weight and then divided by 100 and then rounded up to the nearest hundred.
LTL carrier operation
LTL carriers prefer to handle shipments with the least amount of handling units possible. LTL carriers prefer a shipment of 1 pallet containing many boxes shrink wrapped to form one piece rather than many individual pieces. This reduces handling costs and the risk of damage during transit. Typically, the per pound rates of LTL carriers are less than the per pound rates of parcel carriers.
Both LTL carriers and XL parcel carriers are similar in the fact that they both use a network of hubs and terminals to deliver freight. Delivery times by both types of service providers are not directly dependent upon the distance between shipper and consignee. Also, using an LTL carrier is very similar to that of using a parcel carrier. The shipper often has a regular, if not daily, pickup schedule and can log onto the carriers homepage to schedule pickups, track shipments, print paperwork, and manage billing information.
"Zone skipping" is the use of LTL carriers to transport parcels to a parcel carrier's hub near the load's final destination instead of relying on the parcel carrier for end-to-end delivery. The term "zone skipping" refers to the LTL carrier bypassing the parcel carrier's traditional "zones", which allows the shipper to avoid charges incurred by the parcels crossing multiple zones en route from the shipper to the final destination. For example, if a shipper in North Carolina has 500 parcels bound for California, 250 bound for New York, and 250 bound for Indiana, the shipper will segregate the parcels by their destination, combine the segregated parcels into loads, and use LTL carriers to transport the loads to the parcel carrier's hubs in that state or region; the parcel carrier will then unpack the load that was delivered and transport the individual parcels to their final destinations. This method can allow for substantial savings, particularly if the parcels would have to cross multiple parcel carrier zones if transported by the parcel carrier from end-to-end, and also reduces the possibility of loss on the parcel carrier's part (since all parcels for a destination will arrive at the hub at the same time).
Many shippers prefer to not use such methods as they prefer to only contract with one service provider, because using a LTL carrier and a parcel carrier adds another point of failure for the shipper's operations (that is, something can go wrong during the grouping of all parcels into one load at the LTL carrier entry point).
Preparing shipments for LTL carriers
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Freight sent via LTL carriers must be handled several times during transit, often by different carriers. It must be packaged to protect it from scuffing, vibration, crushing, dropping, humidity, condensation. Thus it is normally good practice to load freight onto pallets or package freight into crates. Sturdy shipping containers such as corrugated fiberboard boxes are normally acceptable as well. Carriers have published tariffs that provide some guidance for packaging. Packaging engineers design and test packaging to meet the specific needs of the logistics system and the product being shipped.
Proper packaging freight serves several purposes:
- It helps protect the freight from handling and transit damage.
- It helps protect other freight from being damaged by your freight.
- It helps reduce package pilferage
- It helps to avoid loss situations; situations in which some of your freight is separated from the rest and lost in transit.
Since freight sent via LTL carriers is subject to misrouting or misloading it is a good practice to put the tracking number on each side of each piece of freight. If the destination state and zipcode are affixed to each side as well, misloading is less likely to occur. Even though it is not required it is good practice to affix a relatively large label including four letter carrier code, tracking number, destination station, and destination zipcode of the shipment (i.e. ABFS123456789 GA 30301). The easier it is for dockworkers to identify an individual shipment the less likely it is to be put in the wrong place. The value or type of contents should not be advertised on the package to help reduce losses. If the only piece of identification is the tracking number the dockworker will have a harder time identifying the shipments pieces and as such the chances of freight being loaded onto the wrong trailer is greater thereby increasing the transit time and also increasing the chances of the shipment being lost. Proper labels, bar codes, and RFID are important for proper routing and delivery.
Intermodal transportation of LTL shipping
Not all LTL shipments travel by truck only. LTL carriers rely on rail or air to forward some freight toward its destination. LTL carriers are normally able to deal with railroads more effectively than small shippers are able to as LTL carriers typically send a large volume of freight each and every day. For example, a significant portion of rail intermodal traffic consists of UPS truck trailers, often dozens in a single intermodal train, carrying LTL freight. LTL carriers are able to monitor railroad performance to ensure delivery of freight within the specified delivery window. An Intermodal freight transport shipment employs several methods of transporting goods from start to finish. For instance one shipment will start out on the railroad, then be transferred to an ocean carrier, and end up on a truck before delivery.
Intermodal shipping is considered advantageous by some shippers because there is no handling of the freight when it changes from one carrier to the next. Pallets are used to consolidate many things into one easy-to-move container. Because handling is reduced it also reduces damage and loss, increases security, and allows the items to be transported more quickly.
- McKinlay, A. H. (2004). Transport Packaging. IoPP.
- Fielder, R. M (1995). Distribution Packaging Technology. IoPP.
- "Choosing LTL Freight Carriers". Retrieved 10 October 2011.