Shipping is an integral part of global supply chains. However, not all shipping methods are appropriate for all businesses. With so many options available, which one is best for your company? For example, businesses with high volumes of freight will have different shipping needs than businesses that ship less frequently or order a lower volume of products.
When it comes to FTL vs LTL shipping, which one is better? Understanding the difference can help you choose your business’s most efficient shipping option.
What Do FTL and LTL Mean?
FTL and LTL are the two main commercial shipping options available. Before asking which is more advantageous for your business, let’s discuss what each means.
What Is LTL?
Less-than-a-truckload, also known as LTL, is a shipping option that allows companies with low-volume freight to share cargo space in a truck or shipping container. Rather than pay for the full cost of a shipping container, LTL enables companies to only pay for the space they need since it divides the shipping cost between the participating companies.
What Is FTL?
Full-truckload, also known as FTL, refers to shipments that take up an entire truck or cargo container. Unlike LTL, FTL gives a company exclusive access to available shipping space. Companies often reserve FTL shipping for large shipments that take up a truck’s or shipping container’s carrying capacity. An FTL shipment allows companies to maximize their orders without worrying about space constraints.
Since the two shipping options serve different purposes, one is not objectively better than the other. Whether or not FTL or LTL is best for your company will largely depend on the scale of your business and the number of items you want to ship.
LTL vs FTL – The Differences
Aside from the apparent space differences, FTL and LTL also differ in terms of logistics, affordability, wait time, and availability. We will go over some of these LTL vs FTL differences in detail below:
LTL is typically cheaper than FTL because it combines multiple orders from different businesses, so each participating company shares in the cost of a truckload. This divides the shipping cost between participating businesses and only requires payment for the space you use.
With FTL, a company must pay the entire cost of shipping a full load, regardless of whether or not the company uses the whole space.
An FTL shipment offers more space than an LTL shipment. LTL shipments typically range from 150 to no more than 15,000 pounds. By definition, LTL provides only a fraction of the space available with FTL shipments, which can take up the entire truck and weigh upwards of 20,000 pounds.
Since LTL shipping contains multiple orders with different destinations, LTL shipments can take longer than FTL. This option gives the sender more control over when and where their order arrives.
By comparison, FTL gives companies more control over the handling of their freight since the shipment stays on the same vehicle for the entire duration of its shipping journey.
Because LTL shipments often change vehicles on the way to their destination, companies often have less control over handling fragile items.
FTL vs LTL Shipping Examples
Real-world examples of FTL vs. LTL shipping can help demonstrate the practical differences between the two.
In the first scenario, we have a food distributor looking to deliver avocados from Mexico to several different markets in the United States. Food distributors typically ship large volumes of fragile and perishable goods across long distances.
Even though the yield of food crops can vary in quantity, the distributor will still want as much room as possible, in case farmers produce a large number of avocados. Avocados are perishable, so the distributor seeks to ensure the shipment comes in on time to avoid spoilage. In this case, FTL shipping is the logical choice for the distributor.
In the second scenario, we have a boutique perfume importer who sells to local markets. The manufacturer only produces a small number of perfume bottles each month, and the bottles themselves are relatively small. Since the perfume lasts a long time and takes up little space, the importer does not require a full truckload to ship his orders and does not mind if the shipment takes a few extra days. In this instance, LTL is the logical choice for the perfume importer.
FTL vs LTL – Benefits & Challenges
Aside from being suitable for different purposes, FTL and LTL shipping also present a range of other benefits and risks that businesses should consider.
LTL is ideal for businesses shipping small quantities of freight and allows them to save on shipping costs.
On top of being less expensive, LTL is also more environmentally friendly than FTL. More orders on one vehicle mean fewer trucks on the road. Fewer trucks equate to fewer emissions, lowering your company’s carbon output. However, because LTL shipments rely on shared space, rates and availability vary greatly. This can complicate logistical details and require advanced planning.
FTL is ideal for companies that ship large quantities of products and provides more control over the shipping process. FTL allows for more specific handling instructions and also ensures that shipments arrive on time. However, if a company does not utilize all the space in a truck, they may end up paying for space they’re not using.
Outsourcing Shipping to Third Parties: Encore Home Delivery
For companies looking to outsource their shipping needs, the question of FTL vs LTL shipping only represents part of the equation. While FTL and LTL shipping can both deliver products to your business, local and last-mile delivery companies like Encore Home Delivery ensure that your products reach their final destinations.
With 33 warehouses and access to 30 waypoints in Canada, Encore offers a robust logistical infrastructure and storage space to help its partners manage their inventory and satisfy customer orders. As a sister company of AMJ Campbell, Encore also provides clients with access to an extensive fleet of state-of-the-art delivery vehicles. Contact us today at 905.670.7111 to find out more about our shipping service.