Less Than Truckload (LTL) shipping moves shipments too large for standard package carriers but not substantial enough to fill an entire semi-trailer. This logistics solution allows businesses to move mid-sized quantities of goods efficiently without bearing the expense of a dedicated truck. LTL acts as an economic bridge between high-volume freight and small-package delivery services, supporting countless small and medium-sized enterprises.
Defining Less Than Truckload Shipping
Less Than Truckload shipping is defined by the size and nature of the cargo, typically accommodating shipments that weigh between 150 and 15,000 pounds. These individual shipments occupy only a fraction of the total space within a standard 53-foot trailer. The defining principle of LTL is shared capacity, where goods from numerous shippers are consolidated onto the same truck for transport.
LTL freight requires secure preparation for transport within a dynamic environment. Shipments generally require placement on pallets, skids, or within sturdy crates to facilitate efficient handling by forklifts and pallet jacks. Proper LTL preparation involves securing the product to its base, ensuring the contents are stable, and protecting them from the routine movement associated with multiple loading and unloading events.
The Operational Mechanics of LTL
The movement of an LTL shipment follows a multi-stage process governed by a sophisticated hub-and-spoke network. The journey begins with a local driver picking up the freight from the shipper’s dock, often alongside several other pickups. This initial freight is then taken to the carrier’s local terminal, which functions as a spoke within the larger system.
At the local terminal, the freight is offloaded and consolidated with other shipments destined for similar geographic regions. This consolidation groups various shipments into a single, efficient load. Once a full trailer load is achieved for long-distance travel, the unit moves out in what is known as a linehaul shipment.
The linehaul truck travels directly to a central distribution center or major transfer hub. Upon arrival, the trailer is unloaded, and individual pallets are sorted onto new trailers based on their final delivery area. The goal of the hub is to minimize the amount of time freight spends on the dock, moving it swiftly from inbound trailers to outbound linehaul trucks.
The freight then moves via secondary linehaul to the destination terminal, the spoke closest to the consignee. From there, the shipment is loaded onto a local delivery truck for the final leg of the journey. The driver makes multiple stops to deliver the various shipments to their respective receivers, completing the structured system.
Key Benefits of Using LTL
The primary advantage of LTL services is the significant gain in cost efficiency for shippers. Businesses only pay for the specific space their freight occupies on the trailer, avoiding the expense of an entire dedicated truck. This fractional cost model makes shipping smaller volumes of goods financially feasible for companies of all sizes.
LTL also offers environmental benefits by optimizing transportation resources. Consolidating multiple smaller shipments reduces the number of partially empty trucks, lowering overall fuel consumption and emissions.
The mandatory palletization of LTL freight contributes to enhanced security throughout transit. Freight is handled less frequently than individual parcel shipments, reducing the risk of damage or loss. This method also grants businesses greater flexibility in inventory management, allowing them to maintain leaner stock levels through smaller, more frequent orders.
Understanding LTL Pricing Factors
Determining the final cost of an LTL shipment involves a calculation based on four primary variables. The most complex is the freight classification, standardized by the National Motor Freight Traffic Association (NMFTA) under the NMFC system. This system assigns one of 18 classes, ranging from 50 to 500, to every commodity.
Classification reflects the ease of transporting the item, considering four characteristics: density, stowability, handling, and liability. Items that are dense, easy to handle, or low-liability receive lower classifications and lower rates. Conversely, light, bulky, or fragile items are assigned higher classes and incur greater expense.
Weight and distance also play a substantial role, as the total mass and the mileage between terminals directly impact fuel and labor costs. Carriers use weight breaks to determine the rate per pound, often making slightly heavier shipments more cost-efficient per pound.
Finally, accessorial charges are fees added for services extending beyond a standard dock-to-dock shipment. These cover non-standard requirements like requiring a liftgate for facilities without a loading dock, or delivery to a residential address. Limited access locations or detention fees for excessive loading time also incur additional charges.
Preparing Your LTL Shipment
Proper preparation ensures an LTL shipment moves smoothly through the network and arrives undamaged. This involves securing the cargo on a sturdy, undamaged pallet large enough to contain the entire load. Shrink-wrapping the items tightly to the pallet maintains stacking stability and prevents shifting during transit.
All individual boxes must be clearly labeled, and a master label should be placed prominently on the outside of the palletized unit. The most important document is the Bill of Lading (BOL), which serves as both a contract of carriage and a receipt for the goods.
The BOL must accurately detail information including the names and addresses of the shipper and consignee, the exact piece count, the total weight, and the correct freight classification. An accurate and complete BOL is mandatory for the carrier to process the shipment.
LTL vs. Other Shipping Methods
LTL occupies a distinct niche in the supply chain, falling between parcel shipping and Full Truckload (FTL). Parcel services handle small, individual packages. LTL begins precisely where parcel carriers typically stop accepting shipments, generally around the 150-pound mark. LTL is necessary when items are too large, heavy, or numerous for parcel carriers and require palletization.
LTL gives way to FTL when a shipment exceeds approximately 15,000 pounds or requires the exclusive use of the entire trailer. FTL involves a single dedicated truck traveling directly from origin to destination with no intermediate stops. This dedicated service results in significantly faster transit times and reduced handling risk compared to the multiple stops and cross-docking inherent in the LTL process.
The decision between FTL and LTL depends on volume, urgency, and cost tolerance. FTL offers speed and security at a higher price because the shipper pays for the entire trailer regardless of how full it is. LTL provides cost savings and flexibility by sharing trailer space, accepting the longer transit times that result from the hub-and-spoke network.