For supply chain and logistics managers, one of the most important ways to save on costs is to maximize efficiency. However, with all the complications, congestion, and capacity challenges, new options are being considered. Increasingly, shipping professionals are looking at less-than-truckload (LTL) trucking.
Many freight carriers offer LTL shipping services, in which cargo from multiple shippers is combined in one truck and transported all together. Individual shippers pay only for the capacity they use on the truck. The main alternative, full truckload (FTL) shipping, only transports one shipper’s goods in an entire truck. The different requirements for LTL shipping can have a positive impact on supply chain efficiency. Here are five ways that can happen.
Unlike FTL shipping, when a company uses LTL, they don’t need to wait until an entire truckload full of their products is ready to go. As soon as a reasonable amount is produced (LTL shipments have a general minimum weight of around 150 lbs, depending on the carrier), or as is increasingly common, already sold, they can be sent via LTL. It’s no coincidence that the recent increase in LTL shipping activity happened alongside the boom of ecommerce. Small businesses that sell their goods primarily or solely online frequently use LTL to get their relatively small amount of products to their customers.
However, even larger businesses can benefit from LTL. By moving smaller amounts of goods, they pay only for the truck capacity they need and can even save on warehousing costs by reducing the amount of goods sitting around and waiting to be moved to customers, retailers, or storefronts.
When shipping FTL, there is much less incentive to pack goods as tightly and densely as possible. After all, shippers are trying to justify the use of an entire truck trailer while still getting their freight on the road reasonably quickly. However, with LTL, there is a strong incentive to optimize the packaging of goods. Two of the primary considerations that carriers take into account when determining the cost of an LTL shipment are size and density. This focus on density means that, for shippers, one way to get the best value on their shipments is to make sure they are as small and dense as possible. This push towards packaging efficiency for shippers has the added benefit of also being good for the environment.
On the other side of the transaction, carriers also have an incentive to make the best possible use of every inch of space in each of their trailers. Because they are basically selling capacity, maximizing full use of that capacity is in their financial interest. They also benefit from an increased efficiency in their fuel costs due to the dense packing of their cargo.
Another factor contributing to fuel efficiency is the increased focus on route optimization needed for LTL shipping. Unlike FTL shipping, LTL trucks aren’t simply moving a single load of freight from origin to destination. They must move various shipments in the same general direction, often over long distances. This causes carriers to look at their customers’ shipments and carefully plan the best way to get all of them where they need to go.
Third-party logistics companies (3PLs) like Koho often offer sophisticated platforms that streamline LTL shipping processes from beginning to end. What has traditionally been a very analog business is benefiting from new technologies more than ever before. With Koho, shippers can instantly get quotes from multiple carriers, compare them, find the best value, and book a shipment from anywhere at any time. Once a shipment is on the road, they can track it, be automatically informed of the latest updates, and contact Koho representatives if any problems arise along the way. After the shipment is completed, managing any added charges or filing a claim on damaged or lost goods can be done through the platform. All this makes managing LTL supply chains much less time intensive. To learn more, visit gokoho.com and get a quote today.
For supply chain and logistics managers, one of the most important ways to save on costs is to maximize efficiency. However, with all the complications, congestion, and capacity challenges, new options are being considered. Increasingly, shipping professionals are looking at less-than-truckload (LTL) trucking.
Many freight carriers offer LTL shipping services, in which cargo from multiple shippers is combined in one truck and transported all together. Individual shippers pay only for the capacity they use on the truck. The main alternative, full truckload (FTL) shipping, only transports one shipper’s goods in an entire truck. The different requirements for LTL shipping can have a positive impact on supply chain efficiency. Here are five ways that can happen.
Unlike FTL shipping, when a company uses LTL, they don’t need to wait until an entire truckload full of their products is ready to go. As soon as a reasonable amount is produced (LTL shipments have a general minimum weight of around 150 lbs, depending on the carrier), or as is increasingly common, already sold, they can be sent via LTL. It’s no coincidence that the recent increase in LTL shipping activity happened alongside the boom of ecommerce. Small businesses that sell their goods primarily or solely online frequently use LTL to get their relatively small amount of products to their customers.
However, even larger businesses can benefit from LTL. By moving smaller amounts of goods, they pay only for the truck capacity they need and can even save on warehousing costs by reducing the amount of goods sitting around and waiting to be moved to customers, retailers, or storefronts.
When shipping FTL, there is much less incentive to pack goods as tightly and densely as possible. After all, shippers are trying to justify the use of an entire truck trailer while still getting their freight on the road reasonably quickly. However, with LTL, there is a strong incentive to optimize the packaging of goods. Two of the primary considerations that carriers take into account when determining the cost of an LTL shipment are size and density. This focus on density means that, for shippers, one way to get the best value on their shipments is to make sure they are as small and dense as possible. This push towards packaging efficiency for shippers has the added benefit of also being good for the environment.
On the other side of the transaction, carriers also have an incentive to make the best possible use of every inch of space in each of their trailers. Because they are basically selling capacity, maximizing full use of that capacity is in their financial interest. They also benefit from an increased efficiency in their fuel costs due to the dense packing of their cargo.
Another factor contributing to fuel efficiency is the increased focus on route optimization needed for LTL shipping. Unlike FTL shipping, LTL trucks aren’t simply moving a single load of freight from origin to destination. They must move various shipments in the same general direction, often over long distances. This causes carriers to look at their customers’ shipments and carefully plan the best way to get all of them where they need to go.
Third-party logistics companies (3PLs) like Koho often offer sophisticated platforms that streamline LTL shipping processes from beginning to end. What has traditionally been a very analog business is benefiting from new technologies more than ever before. With Koho, shippers can instantly get quotes from multiple carriers, compare them, find the best value, and book a shipment from anywhere at any time. Once a shipment is on the road, they can track it, be automatically informed of the latest updates, and contact Koho representatives if any problems arise along the way. After the shipment is completed, managing any added charges or filing a claim on damaged or lost goods can be done through the platform. All this makes managing LTL supply chains much less time intensive. To learn more, visit gokoho.com and get a quote today.
