Understanding LTL Shipping: Save Costs and Improve Efficiency

Less than truckload (LTL) shipping offers businesses a cost-effective solution for transporting smaller shipments without needing a full truck. During a recent #USAMfgHour chat, host Tracy St. Clair of Total Distribution, Inc., an Ohio-based supply chain solutions provider, led industry professionals in a discussion of the basics of LTL. Read on for the key takeaways of this chat, including expert insights on weight limits, shipping times, tracking capabilities, and optimization tips. 

 

What is LTL Shipping?

The chat began with host St. Clair asking participants to define LTL shipping.

“I know very little about shipping and logistics, so I am here to learn from the expert today!” said Whitney Koch from Keystone Click.

“I made it very simple today. Setting a foundation,” host St. Clair clarified.

“Part load shipment?” wondered Nigel Packer of PelaTis Online. “When you don’t have a full load and share a trailer with other companies going to the same destination or area?”

“Correct Nigel!” host St. Clair commended. “Helps save on costs because the shipper does not have to pay for a truck by themselves.”

“Oh good, I know something about this from my manufacturing days,” replied Packer. “I think the language/terminology is slightly different.”

“I’m stepping aside for the experts on this one!” noted Jamie Molina from Social Success Marketing. “From what I recall, LTL shipping is a great way to save on freight costs, but could you provide more details?”

“The shipment can be a pallet or more but not a truckload,” host St. Clair replied to Jamie to clarify.

“Less Than Truckload,” answered Kirsten Austin from DCSC, Inc.

Host St. Clair provided this official definition: “LTL shipping is a cost-effective way to transport smaller shipments that don’t require a full truckload by sharing space with other shipments. LTL stands for Less Than Truckload.”

 

How Does LTL Shipping Work?

Participants were then asked to explain how LTL shipping works.

“I presume you as the shipper would need to work with a 3rd party who would then handle the shipping,” reasoned Koch.

“A 3PL [third-party logistics] is much easier because if something was to happen to your shipment the 3PL will handle claims so you don’t have to,” St. Clair explained to Koch. “If you go directly through the carrier you have to handle all that yourself, which takes you away from important issues in your company.”

Host St. Clair added: “There is a lot to know about LTL that some people don’t think about it. Look at All Risk Insurance. A lot of businesses do not know about that, which can save them thousands of dollars.” 

“You pack a pallet and phone /email/ contact your shipping agent and they pick it up,” answered Packer. “Take it to a local distribution centre where it gets loaded on a big truck to go to a distribution centre close to its final destination?”

“The load should stay on the truck that picks it up,” host St. Clair replied to Packer. “Taking it to a distribution centre can delay your shipment. Why? Because they will hold the freight to that area till they have a full truck. Time is of the essence.”

“OK, thanks for filling in the gaps,” Packer told host St. Clair.

“From your…definition, it seems LTL shipping is a cost-effective way to save on freight by sharing truck space with other shippers. Hope that’s correct!” stated Molina.

“Absolutely!” host St. Clair assured Molina. “It helps businesses with a small shipment save money.”

“Truly cost-effective!” Molina exclaimed.

“Yes, especially if your shipment has to travel very far,” host St. Clair confirmed.

Before moving on to the next question, host St. Clair provided this summary of LTL shipping: “LTL shipments are combined with other small shipments to fill a truck. Each shipper pays only for the portion of the trailer their freight occupies.” 

 

Weight Range for LTL Shipments

Participants were then asked to provide the typical weight range for LTL shipments.

“Minimum 100 pounds?” Koch guessed.

“Very close,” host St. Clair replied to Koch. “Typically the minimum weight for shipping LTL is 150 lbs.”

“I’ll let the experts take the lead again, but I’ll take a shot at it: could it be maximum of 5000 pounds,” Molina wondered.

“When I was doing part loads, back in the day, they were up to 15 tons. So anything from to that (sic)?” supposed Packer.

“LTL shipment max is 15,000 pounds,” host St. Clair explained to Packer. “Over that, you would have to use a whole truck. However, each carrier has different limits.”

According to host St. Clair, “LTL shipments usually weigh between 150-15,000 pounds.”

This answer surprised Austin.

“I did not know that and we live and breathe shipping with our shipping software,” Austin said. “WOW, this is why I love #USAMfgHour so much.”

 

How Long Does LTL Shipping Take?

Next, host St. Clair asked participants to share how long they believe LTL shipping takes.

“Total guess but the answer is it varies depending upon the origin and destination of the shipment,” Austin hypothesized.

“Yes, the shipment usually takes from 2-5 days depending on [the] destination,” host St. Clair responded to Austin. 

“I’d guess it’s around 2 to 8 business days. Here’s hoping!” speculated Molina.

“[I]t depends on the distance and the location of all concerned?” questioned Packer. “My experience was a daily turnaround.  We had product delivered within 4 hours of pick up.”

“Yes, distance is key, Nigel,” host St. Clair confirmed to Packer.

“Wow, same-day delivery? That’s impressive!” Molina exclaimed, joining the side conversation.

“It’s a small country,” Packer replied to Molina, referring to his home country of Wales.  “The longest distance end to end in the UK is 600 miles – Lands end to John O’Groats. The road mileage for that is 837 miles. We are never more than 70 miles from the sea.” 

“That would depend on how far your shipment has to travel and the stops of the other partial loads, I think,” estimated Koch.

“Yes! You could be going one state over and just take two days but going across [the] country could take 5 days!” explained host St. Clair. “Remember these are business days only. Weekends do not count.”

As host St. Clair touched on in her responses to participants, LTL shipping times vary, though they “typically ranging from 2 to 5 business days, depending on the distance and route.”

“That makes sense!” Molina responded to host St. Clair. “LTL shipping is flexible depending on distance and route.”

 

Tracking Capabilities for LTL Shipments

Tracking is important for B2C customers, with most retailers providing shipment tracking in their apps and post-purchase emails. Is it possible to track B2B LTL shipments?

“LTL shipments should provide tracking numbers for accountability and to give clients peace of mind,” Molina stated.

“Yes, if you have the right technology you can track shipments,” clarified Austin. 

Host St. Clair agreed, stating, “Yes, with the use of the BOL [bill of lading].”

“I would assume that with modern technology this would be doable,” stated Packer. 

“Yes, and the shipments have to have a bill of lading (BOL) to help keep track of the shipment,” host St. Clair replied to Packer in confirmation.

“I would hope that would be standard for all shipments,” Koch stated.

“Yes, you can track all shipments. Whether they are LTL, Truckload, Hotshot or International,” host St. Clair explained.

As in B2C, B2B shipping – including LTL shipments – come with tracking capabilities. Host St. Clair explained that “LTL carriers provide tracking capabilities through the bill of lading (BOL), number or shipment reference number.”

 

The Value of Optimizing LTL Shipping

To conclude the chat, host St. Clair shared the importance of LTL shipping:

“Optimizing LTL shipping can reduce costs, improve delivery times, and increase flexibility, making your supply chain more efficient and responsive. This leads to sustainable growth by enhancing operational efficiency and minimizing environmental impact.”

Packer responded to host St. Clair, highlighting that “LTL points to a great way to reduce shipping cost, get your product to the customer quickly and help to grow your business. Win, Win, Win.”

Host St. Clair agreed with the importance of optimizing shipping to save money.

“Especially for small businesses who may have a shipment that they either need to ship or get to them,” she said. “I helped a business save $400-$600 a shipment by showing them how to handle their shipping. Their supplier was tacking that much on. Hurting her bottom line.”

 

About #USAMfgHour

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