Full truckload, less-than-truckload, parcel, intermodal. Over-the-road, air, cargo ship, train. In today’s world, there are numerous ways to ship your company’s freight that it can be a daunting task to ensure you make the right call when it comes to moving freight. However, determining the correct shipping mode can have many benefits for your company, including cost-savings, operational efficiencies and improved customer relationships. But, how do companies determine the best mode for shipping their freight?
Shipping Modes and the Best Freight for Them
Full truckload: Full truckload shipping is used for very large shipments, often more than 15,000 pounds and that would require the use of a full semi-truck/trailer. This mode can be cost-effective because it is generally priced by miles instead of density. It is especially cost effective if one carrier can transport the freight from its point of origin to its final destination. By shipping with one FTL carrier, you also get the added benefit of less handling of your goods, reducing the chance of damage. Full truckload carriers also must meet equipment and insurance requirements, so you are assured that your freight is covered even in the event of damage or loss. Additionally, this mode makes more sense than shipping multiple LTL loads of the same freight more frequently. If you can combine shipments into one FTL, your company will save money as long as you have the ability to store the extra freight. This may require some cost and space analysis.
Therefore, FTL is best for very large, heavy loads and time-sensitive shipments because of the continuity of carrier.
Less than truckload: LTL shipping happens when multiple companies share space in the same truck/trailer. Companies basically lease space on a truck for their freight. Although carriers will fill trucks based on destination and lane, they often still make multiple stops to deliver or pick up freight, which can result in longer transit times than FTL. But because the company isn’t paying for the whole truck, they split the cost, resulting in less freight spend. Also, LTL generally uses a hub and spoke model, meaning that freight pickup locations act as hubs and other terminals act as spokes, so shippers will likely need a secondary shipping method from terminal to final destination, or last-mile delivery service. However, as noted in a previous blog, many LTL companies are venturing into this type of freight delivery, so this additional step can be avoided, depending on the carrier you choose.
This mode is best for medium-sized shipments that can’t full a full truck and that aren’t super time-sensitive. Typically, LTL is best for shipments that are six pallets or less and weigh between 150-14,999 pounds.
Parcel: Parcel shipping, also called small packer or small pack, is meant for freight that weighs less than 150 pounds and that can be moved easily and quickly. Parcel ships individually labeled packages directly to the consumer or residential home. For example, Amazon and other retailers ship parcel packages often through UPS or FedEx, the most common parcel transportation companies.
Therefore, parcel is perfect for individual, smaller packages that have varied destinations, often residential. Parcel freight is generally lightweight and less than six feet long (any direction).
Intermodal: Intermodal shipping combines more than one mode. This mode is used for many international shipments that must travel overseas or freight that must travel long distance. Because of the multiple modes and carriers and the distance of the freight, this mode is more time-consuming than the other shipping modes, but it can be more economical and environmentally friendly. Intermodal freight must be shipped in containers that meet International Organization of Standardization dimension guidelines because the container if transferred from mode to mode. Having it a standardized size makes this shipping more feasible.
Intermodal shipping is not recommended for time-sensitive, lightweight or valuable freight. It is better suited for commodities (like coal, metal or oil).
It really comes down to knowing your freight and your customers when determining the best shipping mode for your company. For the loads that can ship over multiple modes, it is always best to compare rates and consider transit times as well as the potential for damage. When you choose the best mode, your company will often save money or reduce travel time and build trust between your company and the carrier(s) as well as with your customers.