Business needs and inventory requirements determine a company’s shipping decision, along with factors like cost and commodity type. Ocean freight shipping is one type of freight transportation that provides reliable large-volume transportation, with options designed to accommodate varying cargo sizes such as full container load (FCL) and less than container load (LCL) shipping.
LCL Shipping: What is it?
As oppose to full container loads (FCL) when shippers utilize an entire container, less than container load (LCL) shipping is when shippers use less than the whole space of a container. The process of handling such shipments often requires coordination and can be logistically complicated. As such, freight forwarders will oversee the process by grouping various shipments in one container to ensure that the process is not only well planned but runs smoothly.
Related: Are Your Shipments Eligible For Duty Drawbacks?
Benefits of Shipping LCL
An individual LCL shipment can be a faster way to ship than FCL. LCL offers consistent weekly sailing schedules for ocean freight. Also, LCL shipments are less expensive than FCL shipments. Shippers only pay for the space they use. From an operations perspective, they can ship smaller orders through LCL, which minimizes inventory management expenses.
Air vs. ACL
If a shipper has just a small shipment, deciding between LCL and air will depend on how quickly the goods are needed and how much the shipper is willing to pay. In general, as shipment size and weight increase, air rates rise dramatically faster than LCL rates.
When Should You Ship LCL?
- When the volume you want to ship is under 13m3. The standard rates for LCL are based on volume and weight.
- When a shipper books a last-minute shipment, especially during peak shipping season.
- When the cargo volume is too high for a full container and too low to fill two boxes. The lowest cost option would be to fill an FCL container and ship the remaining via LCL.
- When the cargo is not urgent. While low-volume shipments are transported via air freight, LCL shipping is a much cheaper alternative in many situations.
LCL Booking
Shippers need to provide the dimensions and weight of cargo that they want to ship to the freight forwarder. Documents and forms such as the cargo packing list, a commercial invoice, and a Bill of Lading must also be filled in and submitted. Additional documentation may also be required, which depends on the type of cargo and the destination port.
Getting Your Goods Are Ready
People will typically ship LCL shipments on a fixed schedule depending on the destination port, so timing is crucial. Grouping of LCL cargo takes place at a warehouse which is known as the origin consolidation warehouse.
The shipper’s cargo must arrive at the warehouse with time to spare. If the warehouse is near the departure port, the cut-off date for the shipment to reach the consolidation warehouse is typically seven days before the sail date. However, the cut-off date will be earlier if delivering cargo to an inland warehouse.
Transferring Merchandise to Port
Once the LCL container is packed and prepared, it is then transported to the departure port. Port cut-off dates for containers are usually around three days before the sail date. Once the consolidated cargo arrives at the port, it is transferred to the shipping line and then shipped to the destination port.
Transshipment
Suppose a shipment is destined to a secondary port. In that case, workers will offload it at a transshipment point, where it will either get transported to another container or wait for more cargo to fill the box before continuing to its final destination.
Related: Completing Every Shipment with Compliance
How Do You Calculate LCL Price?
LCL cost is calculated primarily by volume, usually in cubic meters (CBM). The more space a shipper needs, the more the shipper pays. Weight is also considered, but because container ships can handle huge amounts of weight, volume usually matters more to overall costs.
Also, you cannot ship certain commodities such as motor vehicles via LCL shipping. Shippers also need to be mindful that depending on the item, its origin, and destination country that additional documents and certificates may be required.
Shippers need to be aware that damage to their cargo can occur in many ways such as improper packing of the containers, bad weather at sea and transshipments and intermodal transportation due to the number of pass-throughs.
The more you know about shipping, the more your clients will benefit. For more information, visit us at Alba Wheels Up.
LCL vs. FCL: What’s the Difference?
FCL is a container shipping option where a container is exclusively used for a single shipment. Here is where the container is not shared with other cargo shipments, and one party bears the cost. LCL is when various cargo shipments share the same container as well as the container shipping costs.
Can You Share a Shipping Container?
Shippers may face delays while waiting for other shippers to get their cargo grouped and ready. Additionally, customs may detain the entire container if there are any errors in paperwork.
Related: Making Sure Your Shipments Arrive as Planned
Does Your Container Have to be Full?
Even though a container does not have to be full, shippers need to maximize the space as much as possible by determining the most cost-effective option to ship – FCL or LCL.
Destination Arrival
Once an LCL container arrives at the destination port, the freight forwarder’s destination agent takes over. The container is collected and transported to a warehouse called the destination deconsolidation warehouse. There, the cargo in the container is deconsolidated into individual LCL shipments.
Receiving Merchandise
Once the cargo in the container is deconsolidated, the consignee can go to the warehouse to pick up the merchandise or the agent can handle the delivery to the receiver.
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