Due to the recent rise in demand for same-day delivery, or “as fast as possible” options, the logistics industry has had to innovate in order to meet these requirements. This has resulted in rapid technological advancement.
The process of shipping and transporting goods from A to B more effectively has experienced a complete overhaul in recent years with shippers, cargo freight forwarder companies, and other logistics experts developing impressive techniques & strategies to overcome the challenges laid out before them.
That is why it is important that businesses understand the difference between FTL (Full Truckload) and LTL (Less Than Truckload) shipping methods so that they can make better decisions in choosing the right delivery option.
Of course, as more innovation takes place, an already complex industry is fast becoming a mine-filed for the uninitiated. Thus, it is always worth seeking the expertise of a third-party should you wish to stay ahead of the curve.
In this article, we will explore the advantages & disadvantages of both FTL (Full Truckload) and LTL (Less than Truckload) in terms of money saved, time spent in delivery, and efficiency of the method.
Less than truckload (LTL) shipping is designed to drive up efficiency and cut the overall transportation costs. Without such a method, most companies that ship products would have trouble staying afloat. LTL focuses on filling a single truck with multiple shipments from various clients, all of which are heading the same route. Carriers, such as Transportify, are then able to offer their clients a reduced price.
Let’s say for example that you are an e-commerce company specializing in delivering electronics throughout the Philippines. On an average day you might sell 20-30 electronic products; would it then make sense for you to ship those products in a mostly empty truck on a long-haul trip across the country? It certainly wouldn’t be a cost-effective or maintainable approach to distribution—which is where LTL (Less than Truckload) shipping comes in.
By the time you’ve factored in the cost of fuel consumption, driver wages, and many other financial factors, you’re going to be racking up a significant bill for relatively small order, and nobody wants that. So, unless you are regularly shipping vast quantities of products, LTL shipping is arguably the most suitable shipping method for you to explore.
Maximize profit and minimize cost by filling otherwise unused space in trucks & containers
If you can not fill up the truck with the items you want to transport, then LTL (Less than Truckload) may be a good option for your delivery needs. You can increase savings with LTL because you share the transportation cost with other companies who subscribe to the same LTL (Less than Truckload) service. With LTL, you don’t have to pay the full amount of renting the truck when the space that your cargo occupies is only one-fourth of the total capacity. Thus, this shipping option is ideal for small businesses that can not regularly fill up the capacity of a delivery truck.
Fewer trucks on the road are invariably better for the environment
The environment can greatly benefit from Less than Truckload (LTL) shipping. Instead of one company renting a single truck and only filling up half the total capacity, multiple companies can fill up the truck and transport their goods. Instead of the ratio being one company to one delivery truck, it can now become many companies to a single delivery vehicle. This practice can lessen the number of trucks on the road which translates to fewer greenhouse gas emissions.
Shipments can be transferred multiple times before arriving at their final destination
Because you share the delivery truck with cargo from other companies, there is a high probability that they move your items when they load and unload cargo from other companies. This setup increases the risk of damaging your items, especially if they are fragile.
The process takes longer than FTL shipping
Depending on the order of deliveries scheduled by the third party logistics company, your shipment might be at the bottom of the list. Since many companies have their cargo in the same vehicle, they might be prioritized which means their items are delivered first. Being at the bottom of the list in terms of delivery orders means that the customer to whom you are sending the package will wait a little longer.
Full Truckload shipping is quite simply the polar opposite of LTL shipping, in that there is no combined freight from multiple shippers and thus there are no stops in transit to its destination. There are no additional products inside the truck, only those from one business. This is indeed the costliest form of shipping available, though it is without question, the most efficient. FTL shipments are palletized and are typically in excess of 10,000 lbs.
There are two main scenarios where a company can choose FTL shipping. The first is if you have enough cargo to fill up an entire truck. In such a case, the FTL (Full Truckload) transportation service is the perfect choice for your delivery needs. The other case is when you can not fully occupy the space of the truck but you want a dedicated truck to deliver your goods. This happens when a company ships fragile and delicate items or if you want your delivery to be done as fast as possible. However, you would have to factor in the greater cost and offset that with higher delivery charges.
Check the table below to better understand the difference between our Less Than Truckload and Full Truckload service:
Fast & Efficient
In a Full truckload delivery, you rent the entire truck and don’t share space with any other company. Therefore, this means that there are no other stopovers in between the loading of the products from your warehouse up to the drop-off point. The FTL option is great for high-risk packages and when there is limited time to deliver your products.
Great for Large Deliveries
FTL deliveries are really designed to transport large quantities of goods to a specific location. A company shipping large volumes of merchandise should take advantage of FTL because it can make the most of the delivery fee. Furthermore, there are many benefits of the FTL such as a faster delivery time compared to LTL and that the delivery vehicle is not subject to the requirements of other companies.
Unsuitable for Companies with Regular, Smaller Orders
In FTL deliveries, the company pays for the space of the entire truck which makes it worth it if they are able to occupy the truck’s entire space. However, if you are only delivering a small volume of orders, then it may not be an economical option to choose the FTL (Full Truckload) logistics solution. FTL is ideal for shipments of over 10,000 lbs (4,500 Kg).
Expensive in comparison to the LTL (Less Than Truckload) method
Because you rent the entire truck to deliver your products, then FTL is more expensive than the Less than truckload shipping option. Furthermore, since you do not share the delivery vehicle with another party, you have to shoulder the costs alone.
Which is Better? FTL or LTL?
So, now that you have a better understanding of both FTL and LTL freight shipping, how can you decide which is better? Unfortunately, it is difficult to say which is the superior option as there are many factors that can influence their viability for your operation. However, let’s look at a few generalities for your convenience:
- LTL and FTL fluctuate too much in price, so it is difficult to say which is cheapest (either one can work out cheaper depending on your unique situation and requirements)
- FTL is typically faster than LTL
- LTL offers more options and opportunities for small to medium-sized businesses who are trying to expand their operations
- LTL certainly adds more vulnerability to your shipment due to the additional loading and unloading involved
Ultimately, it comes down to the nature of your shipping requirements. If you move a great number of stocks on a regular basis, then FTL (Full Truckload) will almost certainly be the best option for you (especially if the speed of delivery is paramount). However, if you’re a smaller business with less demand, then you will have to favor LTL in order to save money. You have to weigh up the pros and cons and factor in all of the costs involved for each method.
If you’re still not quite sure as to which method would be best suited to your logistics requirements, then we’d gladly advise you on the matter. Contact Transportify today for a free consultation and we can see if our services can be of benefit to your business.
How Transportify Can Help Your Business
Transportify, an affordable third-party logistics provider that uses web and mobile apps to facilitate bookings, offers Full Truckload (FTL) and partial load services to its clients so that they can deliver efficiently and swiftly their products to customers. It has a wide variety of vehicle classes with different rates that allows a company to choose the right vehicle for their delivery needs at the right price. Transportify offers a Business Program (BP) for those companies who are constantly in need of delivery vehicles for their business delivery activities. The Business Program includes benefits such as flexible payment options, goods insurance, and an account manager to manage your bookings.
What are some companies offering FTL services in the Philippines?
There are many logistics companies in the Philippines offering FTL (Full Truckload) services to companies or individual clients. Transportify, a full-service marketplace provider offers FTL deliveries at affordable rates. They have a wide variety of vehicle classes to satisfy your delivery needs. Vcargo, a B2B (business to business) logistics company, offers customized delivery solutions to its clients. They can also deliver packages via air and sea routes. CitiXpress is another B2B company offering FTL services to its clients. They deliver to key cities in the north and south Luzon. JRS, an express delivery company for about 60 years, offers FTL services to any point in the Philippines.
What industries use LTL logistics solutions?
Since LTL is more affordable for companies that do not regularly ship large amounts of goods, a number of industries subscribe to the LTL method of cargo transportation. Small scale manufacturing companies producing homestyle products may use LTL services to move their goods. These homestyle products include baskets, vases, and even customized furniture. Distributors of food products like meat products and fruits can also use LTL services if they can not fill up the entire cargo truck. LTL transportation can also help retailers who want to deliver their apparel products to distribution centers or outlet stores. Lastly, appliance and furniture companies can also make use of LTL services if they plan to transport small quantities of items like toasters, microwaves, and small chairs.