What Is LTL Freight Shipping & How It Can Benefit Your Business

Dec 7, 2023 | Blog, Pinnacle Services, Trucking Info

Less-than-truckload (LTL) is the preferred choice for many businesses with frequent shipments that fall between 1-6 pallets with a combined weight less than 10,000 lbs.

Providing flexibility and visibility, LTL optimizes costs and pickup/delivery efficiencies for shippers and their customers. 

What Is LTL Freight Shipping?

LTL, or less-than-a-truckload, freight shipping consists of (usually) palletized freight, weighing between 150 lbs to 10,000lbs, that occupies a portion of a trailer for a fraction of a full truckload cost.

The remaining cargo space (and shipping cost) is allocated to other shippers or carriers. 

To maximize trailer capacity and ensure the safety of transported goods, LTL freight carriers typically opt for density-based freight classes.

LTL typically deals with freight classifications larger than parcel shipments and smaller than FTL (full truck load) shipments.

What Is An LTL Carrier?

LTL carriers deal with LTL shipments and specialize in optimizing loads and routes to transport and deliver freight from different shippers in the most efficient manner.

An LTL carrier typically uses a network of warehousing locations or break bulk facilities. 

Because LTL freight is not designed for point-to-point shipping, LTL carriers aim to streamline the process of transporting, loading/unloading, storing, and de-consolidating freight to achieve efficient and cost-effective shipping.

Benefits Of LTL Freight Shipping

In LTL, carriers and drivers aim for optimized route schedules and deliveries, while shippers profit from enhanced flexibility and low transport costs. 

Plus, LTL’s out-and-back delivery models present reverse logistics opportunities, like backhauling, that help reduce the environmental impact of freight transportation.

Numbers speak for themselves. Today, the LTL market in the U.S. is the most lucrative and well-managed niche of the overall $830 billion trucking industry.

And for a good reason. Less-than-truckload comes with numerous benefits.

Cost Savings

By paying only for the trailer space you use for your freight, LTL typically comes at a lower price.

Today, dynamic pricing options can leverage all factors that affect freight rates and offer competitive quotes for LTL loads.

Small Business Friendly

Some SMBs have more limited supplies and resources compared to larger competitors. FTL shipping with empty trailer space is not an ideal solution.

LTL alternatives offer flexible solutions easily tailored to smaller shipping needs.

Enhanced Sustainability 

Most emissions in transportation come from cars and trucks. Still, the news is encouraging.

With technology producing more efficient vehicles and automated delivery optimization solutions, motor-vehicle CO2 emissions have declined in the US since 2005

LTL trucking helps protect the environment via freight consolidation and flexible routing, further enhanced by smart scheduling and warehousing services.

Improved Visibility

To effectively consolidate shipments and plan routes, LTL carriers and shippers use real-time reporting and automated tracking. So, LTL shippers and their customers are able to track virtually every step of transit, usually in real time.

By knowing shipment location, estimated delivery times, as well as delays and issues that may arise, businesses can better streamline operations and build on successful partnerships.

Flexible Service Options

LTL freight shipment offers a long list of extra options and accessorials that can turn out cost-effective in the end. 

For example, inside pickup and delivery, like residential delivery and tradeshow delivery,  or liftgate pickup/delivery, speed up and facilitate the last mile for shippers and consignees.

As for delivery times, LTL transportation works with delivery options, like next-day or 2-day deliveries, and even options like GSS by 5 p.m. or GSS12.

Better Inventory Control

LTL logistics leverage production space use. 

LTL facilitates prompt transport of small loads, reducing the costs of storage and warehouse management while waiting for a full truckload.

What Factors Determine LTL Shipping Rates?

LTL freight shipping rates follow typical transportation logistics costs that are determined by route, freight class, and accessorials.

Distance And Location

Clearly, the bigger the distance, the higher the price. Delivery to remote areas, challenging routes, gate deliveries, etc., raise shipping costs.

Freight Class

Freight class is fundamental to determining LTL rates.

Freight classes are determined by the National Motor Freight Traffic Association (NMFTA)  and provide a uniform foundation for carriers and shippers to determine shipping costs.

There are 18 different freight classes, ranging from Class 50 to Class 500. The higher the density of cargo, the lower the class.

For example, tiles can have a 50 freight class, while a wide-screen TV can be classified as 250.

What Factors That Determine Freight Shipping Class?

Freight classes are calculated based on 4 major factors: 

  1. Commodity and Density – Weight per Unit and Volume
  2. Stowability – Ease of Storage
  3. Handling – Ease of Handling
  4. Liability – Risk Factors

Accessorials

Any extra requirements or accessorial needs for transport, pick up, or delivery have additional LTL costs. 

Examples include sort & segregation. Liftgates, extreme length, etc.

Guaranteed LTL deliveries will incur additional charges. Important to note that Guarantees are only valid from the actual date of pickup. 

What Is A Disadvantage of LTL?

LTL shipping is not so common for some special freight types, such as hazardous materials or high-value freight.

However, experienced 3PLs can still find the perfect LTL solution for HAZMAT shipping or other special transportation requirements. 

How can you reduce LTL shipping costs?

You can cost-optimize your LTL freight before pickup.

  • Consolidate packages in pallets as much as possible, aiming for reduced volume and weight.
  • Get accurate weight and volume to define the correct freight class.
  • Choose strategic origins and destinations and use your in-house transportation department as much as possible. Try to plan deliveries to warehouse hubs or terminals and eliminate a portion of the journey and associated costs.
  • Find ways to minimize accessorial charges for loading and unloading. For example, renting a forklift may come cheaper than choosing a carrier with special equipment.

What is the best way to ship LTL freight?

The best way to optimize your LTL freight shipping is to contact a third-party logistics provider. 

3PLs provide an array of services ranging from strategic planning to optimized transportation options.

Pinnacle Freight Systems, Inc. offers end-to-end supply chain services. Our dedicated LTL trucking team will strategize with you to determine the best LTL solution customized to your needs.

Whether in search of national, regional, or superregional carriers, our integrated LTL schemes are tailored to your shipping requirements, type of goods, and cost-saving initiatives. Ready to get started? Contact sales.

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500 Cedar Lane, Florence, NJ 08518

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