Small business owners deal with plenty of problems day in and day out. They play multiple roles in one, being the overall decision-maker for their business. Customer satisfaction is at the core of many small businesses, and that extends to understanding how you ship your products. What may work for one product won’t work for another.
It’s wise to understand how to spend your money to further the reach of your business. If you ship with no clear understanding of what method is best, you might be impacting your business costs negatively. When choosing between shipping by parcel or less-than-truckload (LTL), choosing one or the other may cost you unnecessary money.
How Do You Choose?
In your search for finding the right shipping method, you’ve probably come across a variety of terms. It’s best to steer clear of full-truckload (TL), as you won’t need it unless you’re shipping enough to fill a truck. Now, you’ve probably narrowed your choices down to parcel and LTL.
Understanding what type of product you’re shipping is a good start. There’s a difference between what can be shipped by parcel and what should be shipped by LTL. It comes down to sizing, weight, and overall price.
Parcel Shipping
Parcel shipping is an in-between solution for those whose product is too large for regular mail but too small for LTL shipping. It’s for lightweight shipments that weigh under 150 pounds and don’t require any palletization. It generally can be handled by a single individual, making it easier for the product to get to consumers.
Rather than the shipment moving slower because it requires more care and specialized equipment, parcel shipping allows the product to move faster through standard ground shipping, and for more time-sensitive shipments, express delivery. It’s cost-effective, saving your business money through a scalable pricing model. The cost is based on the packages’ weight, dimensions, shipping distance between pickup and drop-off, and if any specialized handling requirements are needed. It’s offered by many major carriers, such as UPS, FedEx, and USPS. They offer insurance options, quick transit times, and package tracking.
LTL Shipping
Less-than-truckload shipping is a form of freight shipping. It deals with packages that are between 150 and 10,000 pounds and are mostly transported on pallets. In the world of freight shipping, LTL is a cost-effective option for businesses that need to move heavy freight but don’t need to pay for a whole truck. Your shipment is consolidated with others in order to maximize space, but you only pay for the space you use.
LTL pricing is determined by the dimensions of the package, the weight, density, the distance it needs to travel, handling requirements, and its National Motor Freight Classification (NMFC) code. While parcel shipping may not need a high level of care or any specialized equipment, LTL shipping generally does. Make sure to take note if a liftgate is needed, or if the delivery location constitutes as limited access.
Pallets ensure that products being shipped by LTL remain safe and secure. Since it’s with other freight, properly packaging ensures that the product isn’t damaged. LTL does take longer, as there are stops at terminals to reconsolidate packages. If a package needs to arrive at its destination before a certain date, there are express delivery options available.
LTL shipping is best for business-to-business shipping, though it’s also used for residential deliveries. It’s versatile, but there are regulations that need to be followed. Before setting up a shipment, ensure you have all of the necessary information to make an informed decision.
Differences Between LTL and a Parcel
As mentioned before, there are plenty of differences between LTL and parcel shipping.
1. Size and Weight
Parcel is able to ship packages up to 150 pounds, with a length + girth of 165 inches and a 108-inch max length. LTL can ship packages between 150 and 10,000 pounds, and while pallets are generally boxy, LTL can ship oddly shaped freight as well.
Weight is a major indicator of whether to pick parcel or LTL shipping, but it’s important not to focus solely on it. If you have several shipments going to the same area, but they’re all under 150 pounds, you may think of using parcel. But it might be more cost-effective to consolidate all of the shipments through LTL. Keep in mind that parcel carriers may charge extra if the package is close to their set limits.
2. Location
Locations for pickup and drop-off matter for both parcel and LTL shipping.
Parcel shipping allows packages to be picked up and dropped off at your doorstep or at secure locations nearby, such as lockers. Many carriers, such as Amazon, have lockers in residential areas, giving consumers easy access. For rural or hard-to-access areas, a pickup and drop-off location may need to be set in place.
LTL shipping is generally picked up and delivered curbside or from a loading dock. If the freight needs to be delivered inside of a house or building, that will need to be made note of while receiving your quote, as it’s an added service. These added services include a liftgate service, white glove services, and inside pickup and delivery services.
3. Damage
Damages may occur in both parcel and LTL shipping, but they’re more common in parcel.
Parcel shipments are more susceptible to damage because of their small size, less protective packaging, and the fact that they’re sent through various checkpoints. Ensure that your parcel shipments are protected with strong boxes and cushioning. If damage does occur to a package, carriers have well-established procedures for how to handle damage claims.
Freight being shipped through LTL is less likely to be damaged due to it being stabilized on a pallet. That’s not to say damage won’t occur to an LTL shipment, but if the freight is properly packaged, the risk is lessened. If damage occurs to a shipment, it may lead to a complex damage claim due to the shared truckload environment. Detailed documentation is crucial when a shipment is damaged.
4. Delivery Timeline
The speed of delivery varies between parcel and LTL shipping.
Parcel is faster, with delivery occurring between 1-5 days after shipping. It runs on regular delivery schedules, ensuring consumers have an accurate and guaranteed delivery date. Live and frequent tracking updates make it easier for consumers to anticipate when their shipment might arrive, from what facilities it’s passed through to the hours of delivery.
LTL shipments are delivered between 3-7 days, depending on how many stops need to be made and the distance between pickup and drop-off. Once the shipment is picked up, it’s brought to an origin terminal where it’s sorted with other pallets. Once the shipment departs from that terminal, it may be brought to one or more terminals before it’s delivered to the recipient. You can track LTL shipments, but the delivery dates may not be accurate, depending on the number of stops the shipment needs to take.
5. Price and Payment
The price and payment of a shipment vary between parcel and LTL.
The price of a parcel shipment comes down to the dimensions and weight, which can be measured at any parcel company’s physical location. If a shipment requires extra handling, is close to the weight limit, or oversized, added charges may be applied. Once all of the factors have been determined, you’ll pay the accurate price there.
With LTL, you need the weight, dimensions, and other important information to receive a quote. But the shipment won’t be properly measured until the carrier has the means to do so. You won’t be charged until you receive a quote, as the price may change if any information is incorrect and needs to be changed.
Choose What Works Best for Your Business
Choose parcel shipping when:
– the shipment weighs under 150 pounds
– a quick delivery is needed
– the delivery location is residential or a business without a loading dock
– packaging the product on a pallet isn’t needed
Choose LTL shipping when:
– the shipment is over 150 pounds and should be palletized
– specialized handling requirements are needed
– the delivery location is a business that is equipped for truck deliveries, such as with a loading dock
– the cost of freight consolidation through LTL is appealing
Keep in mind that you may need to switch between parcel and LTL shipping sometimes. Where one of your products may be perfect for parcel shipping, another might be right for LTL. You don’t have to pick one or the other and stick with it; you always have the chance to choose the other option.
Take Your Pick
In the world of modern logistics, both parcel and LTL shipping play a crucial role in the movement of goods. They provide shippers with easy ways to move their products without hurting their finances. Though it may seem confusing to navigate the logistics of freight, your business will be all the better for it.
For businesses struggling to pick between parcel and LTL shipping, make sure to take note of the differences between them. Understanding if your shipment isn’t over 150 pounds but should be palletized will help you choose LTL, while parcel is better for any residential delivery you may have. Being able to distinguish which option works for each shipment will help your business become more efficient in the long run.
