2024-05-03

Moving cargo via trucks plays a key role in distribution strategies and has the flexibility to accommodate various types and sizes of shipments — with different solutions to cater for your specific needs.

How do you build a good ground freight program for your supply chain? How do you balance different shipment types? In this article we take a closer look at full truckload (FTL) and less-than-truckload (LTL) freight, to help you make an informed decision for your logistics requirements.

What is FTL?

FTL stands for full truckload. It’s when your shipment, as the name suggests, is large enough to fill a truck. This means your cargo won’t be consolidated with other shipments from other customers.

At the origin location, the truck is filled as much as possible, ensuring the best utilisation of space. It’s driven directly to the destination location where your cargo is offloaded to your desired consignee. While this is the most common flow, there are variations based on your needs that carriers can cater for, such as multi-stop deliveries.

What are some of the pros and cons of FTL?

Advantages of FTL:

Transit time: Because the truck is dedicated to your cargo alone, there’s no need to make stops to consolidate other shipments. This can translate into faster transit times.

Disadvantages of FTL:

Optimisation: If you're buying a full truckload, it's up to you to make the most of it. So, if you can't fully utilise the space, your unit costs might increase. This becomes the trade-off between FTL and LTL.

What is LTL?

On the other hand, LTL stands for less-than-truckload. It involves combining multiple smaller shipments from different customers into a single truck. You share the space as well as the costs.

LTL providers, like Shipwell, build networks to efficiently consolidate and deconsolidate based on volume flows. Typically, the carrier will arrive at your desired origin with a truck, you will add your cargo to the existing cargo in the truck, and the carrier will route that cargo through different sortation nodes until it arrives at your desired consignee. Depending on the distance and your service level, there can be very few sortation nodes, or many sortation nodes.

What are some of the pros and cons of LTL?

Advantages of LTL:

• Cost effective: LTL is a great option when you have shipments that are larger than a parcel but not large enough to fill an entire truck. Instead of booking a full truckload for such smaller shipments, with LTL you share the transportation costs with other shippers.
• Flexibility: For destinations that require infrequent cargo deliveries, LTL allows you to ship without waiting to fill a whole truck. Catering to your specific needs in this way allows you to optimise inventory management and better meet customer demands.

Disadvantages of LTL:

• Delivery time: With multiple stops for consolidation and deconsolidation, the transit time for LTL shipments may be longer than FTL.
• Handling: LTL shipments can be handled multiple times during transit.

Which should I choose: FTL or LTL?

To figure out which is the better option for your shipment, you’ll need to take into consideration a bunch of factors such as your shipment size, transit time requirements, and costs.

Here are some examples of when you might use FTL and LTL in your supply chain: