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LCL or FCL - Which is Right for Your Cargo?

If you are uncertain about the best way to ship your goods this article will help you better understand the pros and cons of LCL versus FCL shipments and help determine which option is best for you. 

There are advantages and disadvantages to each and in truth a majority of shippers may choose FCL or full container load simply because they aren’t well versed in the alternative. Sometimes less is more, especially when we are talking about shipments that are LCL or less than container load. LCL_vs_FCL.jpg

Defining the Options

LCL shipments by definition are just what they sound like; shipments of smaller volume cargoes belonging to several different shippers which are then combined or grouped inside a single container. 

FCL shipments by comparison are used by shippers whose cargo volume is large enough to fill up all or most of the container. Unlike less than container load shipments, full containers are booked for the exclusive use of a single shipper. 

When does LCL make Sense?

The rule of thumb when considering LCL is based on the volume of your cargo. For example, a standard dry, general use 20’ container holds roughly 28 cubic meters of cargo. If your shipment is 14 cubic meters, less than half the average load capacity of a 20’ container, consider shipping those goods LCL. There are exceptions to every rule and in the case of the 14 cubic meter benchmark that exception may come down to weight. If your shipment is only 13 cubic meters, but is very heavy cargo, say something like a heavy industrial mold, it may be cheaper to simply book FCL.

When considering all your options it’s true that air freight is always a possibility for smaller shipments but it’s much more expensive. Unless your goods meet the criteria for shipping air freight LCL can be more cost effective.  

The LCL Advantage

There are real advantages to shipping LCL. For example, if you are keeping a close watch on inventory volumes shipping less than container load makes sense for many small or even medium-sized companies who want to avoid keeping large amounts of inventory on hand. Instead of committing to large deliveries from suppliers which can carry the risk of tying up much needed cash flow, LCL shipments can provide a steady flow of inventory in smaller quantities. 

Consider the LCL option if you do business on a consignment basis whereby it may not be practical to book a full container. Finally, a smaller LCL shipment can be an excellent means of testing out a new supplier. Smaller quantities of a new product can be produced to verify quality and allow you to test out the capability and reliability of a prospective supplier. 

What are the Disadvantages of LCL?

There are some disadvantages in shipping LCL including potential delays at origin while the cargo is grouped together to fill the container. Remember, you are sharing the container with other shippers. 

Additionally, the per-cubic meter cost is higher when compared to FCL and care should be taken in packaging and labelling your goods. Use a pallet whenever possible when shipping LCL. This will better facilitate trouble-free cargo handling. 

The Economies of FCL

For shippers who regularly transport more than 15 cubic meters booking a full container offers real savings because you can take full advantage of the economies of scale gained by filling a 20’ or even 40’ container. Filling or nearly filling a 20’ or 40’ container means fewer shipments overall if your supply chain is flexible enough to ship larger volumes at longer intervals. 

There are also security advantages to shipping an entire container. Typically LCL cargo requires additional cargo handling at origin and destination. Shipping FCL means less risk of damage or theft from mishandled goods.

FCL may also afford a faster transit time compared to LCL shipment. This is largely due to the additional handling time required to completely fill the shared container or consol at origin and again at destination.

Remember even experienced importers and exporters can benefit from the expertise offered by a third-party logistics partner. If you are new to shipping and considering LCL versus FCL consider enlisting the aid of a logistics provider who can walk you through the process. A good freight forwarder will know which questions to ask and offer Smart Logistics Solutions to help you save money.

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