Less than truckload (LTL) is a transportation service for goods that would not fill an entire truck. Generally, shipping companies share cargo space with other LTL freight customers to maximize the truck driver’s mileage. Customers seeking LTL carriers should first learn the 7 types of LTL freight to better understand how this service works and what to expect.
Are you paying too much for trucking insurance? Save up to 20% and get covered online in minutes.
What Is LTL Freight?
LTL freight shipping involves moving shipments that do not require a full truckload of space in a trailer. Prices are often lower for shipping goods that don’t fill an entire trailer as you’ll be covering the trucking company’s expenses along with other shippers who are sharing the trailer space.
However, you and the other shippers using the trailer space will still need to keep your freight under the 15,000-pound requirement. LTL freight carriers specialize in this form of transportation.
This also requires added expertise to manage to pick up and to drop off various loads. Route optimization and delivery timelines are more complicated when you add in more items to deliver to various locations.
How Does LTL Freight Work?
This transportation method combines smaller truckloads in order to reach full capacity for a trailer while maximizing the miles that the driver will utilize while transporting those goods. It’s a far more complicated business model because it requires a greater level of detail and planning to ensure profitability and customer satisfaction.
The trucking company charges customers based on the amount of space or weight capacity they use within the trailer, the distance the goods travel, or the location for the pickups and deliveries.
When transporting LTL freight, most carriers offer options for standard, expedited, and guaranteed shipments. But other factors that could impact the service options include the pickup and drop-off locations, such as residential, need for a liftgate, or requirements for reclassifying the goods.
Less than truckload shipments offer many great benefits.
- Reduced Costs. Because shippers share in the expenses of transporting their goods, they’ll pay less than they would for a dedicated truckload.
- Improved Security. Before LTL shipments go on a truck, they get organized into pallets, which help secure the goods for the duration of the shipment.
- Shipment Tracking. LTL carriers offer in-depth tracking information so that you can see where your goods are throughout their journey.
- Additional Services. You don’t get liftgates or inside pickup or delivery when you pay for a full truckload service. But you can get these added services with LTL freight, which can further add to the value of these services.
Factors to Consider with LTL Freight
Because of the nature of the service, LTL freight has unique factors to consider before using this service or offering it as part of your trucking business.
The farther that you transport the goods, the more expensive the shipment will cost. But the location of the goods based on the pickup and delivery locations for the other goods that will fill the truckload matter as well when considering how much the freight will cost to transport.
Dimensions and weights impact the freight class, which further impacts the price of transporting the goods. Be sure you’re accurately describing the freight and what it is before securing this service.
Goods that require faster than normal shipping or very specific pickup and delivery times will be considered expedited freight. These shipments cost more because they’ll be more challenging for the trucking company to deliver on the timeline provided.
LTL freight often comes with added handling options, such as a liftgate if the delivery location does not have a dock for the shipment to come off the truck directly. Or LTL services might include inside pickup or delivery and shipments from limited access areas, such as rural locations.
Example of LTL Freight
To illustrate exactly what LTL freight is, let’s take a look at an example of how this trucking service works. For this example, consider that you’re shipping 5 pallets of electronics weighing 4,400 pounds from Columbus, Ohio, to St. Louis, Missouri.
- The driver visits your Columbus, Ohio, facility to pick up the 5 pallets.
- Inside of the terminal, your shipment is allocated to the door in St. Louis.
- Your pallets destined for St. Louis are loaded onto the correct trailer.
- The delivery is offloaded at its destination site.
- It is then loaded onto a local truck for its final destination at the St. Louis facility.
This is the simplest example of freight going from one city to another. In other scenarios, the freight might go from a truck to a container yard to a train and then to a local delivery truck. It all depends on the service you’ve contracted for, the speed of that service, and where the shipment is going.
7 Types of LTL Freight Carriers
When evaluating LTL freight carriers, you should first realize that there are 7 distinct types. Here’s a look at what each of these carriers has to offer and when you might consider using these services.
1. National LTL Carriers
National LTL carriers are the largest providers for LTL shipments. These transportation companies offer coast-to-coast and border-to-border services. You’ll get the widest coverage and extremely competitive pricing when working with a national carrier.
National carriers have many hubs, drivers, and terminals to make transporting freight simple and efficient. Working with national carriers offers many great benefits.
Even for small companies, it can be wise to have at least one national carrier in your network to ensure your shipments get where they need to go when they need to be there. That way, you don’t need to build a relationship with an LTL carrier in every region.
Using a national carrier can have its drawbacks though, including more complicated communication, timeline constraints, and less flexible rates. Lower volume shippers will also struggle to maintain national carrier relationships due to their limited shipping needs.
2. Multi-Regional LTL Carriers
Multi-regional LTL carriers service large areas consisting of two or more regions. They lack the coast-to-coast and border-to-border coverage of a national provider but have more hubs and locations than a regular regional carrier.
Companies that ship goods in more centralized locations can benefit from the larger resources that multi-regional carriers provide while also not having to contend with the enormity of a national carrier.
These trucking companies offer a great in-between option and can grow with a small business. However, really small companies might still struggle to get the best service from multi-regional carriers due to their size and demands for their services.
3. Regional LTL Carriers
Regional LTL carriers provide services within a set area of states or defined geography. Their service is generally dense within a smaller geography with outstanding options and high-quality services within that smaller footprint.
But of course, outside that smaller operating area, the freight carrier does not have service, which means you might need to maintain multiple freight carrier relationships to get your goods where they need to go.
Regional businesses can benefit from these freight carriers as they specialize in the area where you do business.
4. Sub-Regional Carriers
If your goods are traveling very short distances within a specific area of the country, working with a sub-regional carrier might be best for you. These carriers provide transportation services within a district inside a region.
Given their level of specificity, these carriers are great when your shipments travel shorter distances. They can offer speed and agility that regional and national carriers cannot provide. However, these carriers also serve a specific niche, which isn’t great for larger companies or companies planning to expand soon.
5. Asset-Light LTL Carriers
An asset-light LTL carrier is just like the name implies. These companies keep their overhead low with a limited number of trucks and drivers and lean on smaller LTL carriers to complete their deliveries.
To keep expenses low, the company also shares space with other carriers at large hubs or terminals. Once the goods reach a major hub or terminal, the company contracts out the final mile deliveries using local LTL carriers.
You might get lower pricing from these companies due to their business model of taking advantage of lower overhead. But you’ll also experience slower shipping times and fewer insights into your shipment as the company contracts out some of the work. Companies operating on a tight budget appreciate this type of LTL carrier.
6. Load-to-Ride LTL Carriers
Load-to-ride LTL carriers are designed for simple, long-range shippers. This service is designed for straight-through deliveries, meaning they won’t have stops at terminals along the way, or they’ll have fewer stops than normal.
By focusing on long-range shipments, these companies reduce the need for handling the product over and over again, which can be good for shippers with sensitive freight.
Shippers that transport their goods across many regions and have the flexibility to meet the carrier’s schedule can benefit from excellent pricing and reduced goods handling, though you’ll have to deal with limited capacity and coverage when using these carriers.
7. Reefer LTL Carriers
LTL reefer carriers work very similarly to load-to-ride carriers in that neither of them have to transfer goods at terminals. However, LTL reefer carriers have to ensure that their goods must be transported at a specific temperature.
Reefer cars are temperature-controlled, which is great for transporting goods that have to be kept at certain temperatures to protect them. But you’ll have added challenges as well.
For instance, you’ll need to collaborate with carriers who have other customers with temperature control requirements that match yours. Finding carriers that meet your needs will be more challenging and might require some added calling around for quotes.
LTL Freight vs FTL Freight
LTL refers to less-than-truckload shipments where you share truck space with other shippers with pickup or delivery requirements in areas similar to yours. FTL stands for full truckload where you use the entire trailer space for your goods alone.
You will fill that truck with your shipment, which means you’ll get a faster, more direct service since the carrier won’t have to deal with picking up and delivering other goods along the way.
Each option has its benefits, but the decision between these two services ultimately comes down to the volume of goods you’re transporting.
Finding the Best LTL Carriers
There are so many LTL carrier options out there but finding the one that meets your business needs the best is the key to creating valuable long-term relationships that ensure timely and cost-efficient deliveries.
Looking for the best LTL or FTL carriers to work for? Visit TruckDrivingJobs.com for the up-to-date listings and easy applications to get hired fast!