FTL and LTL: What’s the Difference

Businesses make a number of important decisions before they arrange to have freight loaded onto a truck. First and foremost, they need to consider time and expense when transporting their products. Fortunately, trucking companies offer clients flexibility and a savvy freight broker can often help shippers work out a deal that balances these often-opposing concerns. Partnering with a freight broker is akin to having your own internal logistics team—minus the overhead and hassle—and lets you focus on your core business, whether that’s shipping organic greens to grocery chains or washing machines to big box stores.

A freight broker can help you weigh the two options available to you: full-truckload (FTL) and less-than-truckload (LTL) transport. Sometimes, of course, businesses don’t have a choice. They’ve got orders to fill, whether they can fill a truck for not. Their livelihood depends on sales and sales are only completed when goods are shipped. That’s why it often makes sense to use LTL shipping even when you could fill wait until you’ve filled a container before loading. Let’s take a look at the differences between the two approaches to moving freight and discuss some of the reasons why you might choose one over the other.

What Constitutes a Full Truck Load

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The answer is, it depends. Government regulations dictate many safety and commercial standards for the trucking industry. Generally, the following figures are used to define a full load: 44,000 lbs., 2500 cubic feet, or 48 standard (40x48 footprint) pallets.

But what if, for example, you’re shipping food storage containers which are very lightweight but take up considerable space? That’s where the definition of full load gets a little hazy. By the same token, very dense products like steel may tip the scale upward but still leave a lot of space to fill. The definition of full truckload takes into account product shape and product weight. (Have you ever wondered why ready-to-eat popcorn is so expensive?) The dimensions and weight of the truck used to ship goods also factors into the definition of a full truck load.

In many cases, a freight company will be permitted to fill a trailer beyond the 44,000 lb. maximum so long as it can be packed and moved safely. That’s often where LTL shipping comes in. And LTL shipping does offer businesses some advantages.

Share the Expense

When you ship LTL, the portion of the trailer your goods don’t occupy will be filled by other consigners. That means that many of the costs freight companies incur can be amortized across all consigners sharing the freight container. These include fuel, drivers’ wages, and tariffs. Warehouse costs may also be lower with LTL shipping. So pound for pound, inch for inch, your shipping expenses will likely be lower with LTL shipping than with FTL shipping.

Meet Just-in-Time Demands

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Cash flow is critical to any business, including your own. Just as you don’t want to pay for raw materials before you need them, your customers don’t want to pay for goods until their customers want them. That’s why swimsuits don’t go out on the racks in mid-January. Nor do customers want to pay to warehouse goods that won’t fit on their shelves. Just-in-Time shipping is a fact of life. LTL shipping can help you meet the demand for small, timely orders and solidify your customer relationships.

Time and Money: Striking the Right Balance

LTL shipping does create a dilemma for businesses. While it may allow them to get smaller orders out the door more quickly, it doesn’t guarantee the quickest arrival of goods at their customers’ loading docks. LTL shipping is slower than FTL shipping. The routes truckers must take to deliver all consigners’ loads may not be the most efficient one for any single consigner. Trucks carrying LTL freight will make multiple stops to deliver and unload goods. That, incidentally, is one reason why materials slated for LTL shipping may need to be crated to protect them. The risk of damaged goods is greater with LTL shipping. So if speed and cargo safety are your top priorities, FTL shipping may be the best choice for you.

Get Help Making Smart Decisions

It’s estimated that transportation costs equal about 10% of company revenue. With that much on the line, it’s important to have both a solid transportation strategy and experienced, trustworthy partners to help you implement it. Working with a freight broker who has access to a robust network of reliable, efficient transportation providers is a step in the right direction. As your business grows, a freight broker can help you scale up cost-effectively. And no matter what size business you operate, freight brokers can pass on the value of volume discounts.

Perhaps most importantly, freight brokers have already made the investment in the sophisticated logistics technology required to make the most of your transportation budget. So you can just sit back and enjoy the benefits.

Susan Doktor is a writer and business strategist who hails from New York City. She covers finance, technology, real estate, and insurance. She also guest- and ghost-blogs internationally on topics ranging from mental health and fitness to parenting, and food and wine. Susan’s work on this article is on behalf of Money.com that researches a variety of topics like Mortgage Rates, Life Insurance, and Credit Cards.