Any business owner that sells material products or goods is aware of how vital shipping is to their performance as a company. The freighter they use becomes an extension of the company itself and respectively adds some cells to the lifeblood. Not only does the shipping need to be handled efficiently, with no damaged, lost, or late shipments, but it also can’t eat a glutinous portion of a company’s profit margins.
In which case, companies that ship commodities are constantly striving to improve their shipping process, cut down costs, and up efficiency. They’ll almost always work with a freight broker, freight advancer, or some type of third-party that acts as a liaison (more so a Sherpa) between the shipper and the freighter.
The two most common types of shipping are FTL (full truckload) and LTL (less than truckload). These are then decided upon dependent on the needs of a shipper and what makes the most practical and economic sense. Yet, rarely do you hear of PTL (partial truckload), which is another type of freighting that can greatly reduce costs if it fits a certain shipper’s requirements.
If you’re currently expanding your shipping horizons, or executing the initial groundwork for deciding which type of shipping best suits your company, then it’s important we unpack and identify the differences between LTL and PTL shipping. These types are typically geared towards small-medium sized businesses.
Breaking down common shipping types
To understand the differences between LTL and PTL shipping, it’s paramount that we outline the three main types of shipping in so that you understand the terminology, and why a certain type is typically chosen.
Full truckload shipping is a type of freighting which means a single truck is filled with a single company’s shipment. Not only the costliest type of shipping, but it’s typically the most efficient. The reason is that the transit time is less, and the shipment isn’t unloaded before its destination, being that there are no other unloading stops. This type of shipping is typically utilized by established companies that require a hefty amount of shipping. They tend to use FTL if they’re shipping 15,000 pounds or more and don’t mind paying the extra cost for faster delivery time.
Geared towards smaller-medium sized business, less than truckload shipping is a type of freighting that fills a truck with multiple shipments. The weight is usually less than 4,000 pounds per shipment and LTL isn’t keen to onboarding cargo with pour dimensional weight (when the package is voluminous but the contents themselves on the lighter side). By filling a truck with different shipments all heading to the same destination, carriers are able to save shippers money by offering a reduced price. The downside is that—taking into account all the stops, onboarding, and unloading—the contents have a higher propensity for damage because they pass through multiple hands. Then, the multiple stops are a time drain, and they tend to increase the total transit time.
Still, LTL shipping is commonly the go-to for smaller-medium sized businesses because it’s cost-efficient, flexible, and offered by most freight carriers.
Consolidated freight shipping is a different type of freight altogether, being something of a hybrid between LTL and FTL. It’s only considered an option if a shipper needs a truck for 5,000 to 40,000 pounds, or somewhere between 5-14 pallets. This very specific prerequisite is why it’s not a common type of shipping. However, PTL is usually a straight shot, meaning the same truck which picks up a shipment is the same one that’s going to deliver it. This means that with PTL shipping the cargo has less of a propensity for damage. Additionally, being that it’s one truck and there aren’t any connections, the transit time is typically smaller.
PTL and FTL, which do I choose?
If you fall in this category:
- Shipping 5,000 to 38,000 pounds
- Small-medium sized business
- 5-22 pallets
Then it’s wise to consider PTL as an option. If you choose LTL you’ll basically be paying for the same service with more unloading and loading of your cargo. The way in which PTL shipping is calculated typically boils down to four factors:
- Type of freight: what kind of freight is it? Fragile? Durable? Consolidated into one multi-pallet unit or multiple pallets?
- Distance: how far is your shipping going?
- Type of delivery: does this delivery need to show up in a certain timeframe? Does it need to be expedited? Typically, those that use PTL have to be flexible with their delivery dates: is that your situation?
- Weight: how much of the 5,000 to 38,000 pounds is your cargo? How many pallets are you going to be loading?
- Accessorial: is there a specific way in which your shipment needs to be unloaded? Your destination, is there anything particular about how it’s going to arrive?
- Then, LTL shipping is perfect for lightweight but voluminous shipments that need to be delivered quickly. PTL shipping doesn’t charge you for dimensional weight—which LTL is notorious for. If that’s your reality, then it may be wise to reach out to your broker or freighters and see who is offering PTL freighting.
Last but not least, as we stated before, there’s less of a chance that your shipment is going to be damaged because it’s going to go through less unloads. We do want to note here: sometimes a company offering PTL won’t ship something that’s deemed sensitive, as they don’t want to deal with unique classifications or the possibility of damage.
Less than truckload shipping utilizes equipment by filling a truck with multiple pieces, all from different shipments. It’s the affordable type of shipping aimed at small-medium sized companies that are shipping less than 4,000 pounds or six pallets. Being that every LTL truck is indeed filled to the brim, the cost efficiency surfaces from not having to pay for the entire truck.
The way in which LTL shipping is priced typically looks like this (although it’s always dependent on the specific freight carrier)
Minimum charge (for all shipments)
- Less than 500 pounds
- Between 500 and 1000 pounds
- Between 1000 and 2000 pounds
- Between 2000 and 5000 pounds
- Between 5000 and 10000 pounds
- Between 10000 and 20000 pounds (some carriers don’t offer this weight size)
- One such facet that exists with LTL shipping but not necessarily PTL shipping is that it’s governed by NMTFA (National Motor Freight Traffic Association). The NMTFA has a set of regulations specific to LTL, which works to classify commodities into one of 18 different classes. These classes respectively dictate how difficult a certain commodity is to ship, directly influencing the price of each LTL shipment. The four factors that dictate these LTL classes are density, handling, liability, and storability.
- Similar to PTL, what sort of other accessories will be needed to successfully deliver the shipment? What does the destination offer? Will additional equipment be necessary to unload the truck?
- As with all LTL companies, there is no standardized base rate. This is part of the industry’s competition and often drastically different from one carrier to another. However, there will be a base rate that comes with each shipment, no matter the size or distance.
- Common Sense would tell you that the two biggest factors that determine freight costs are weight and distance. Commonsense isn’t wrong. As you probably guessed the distance required from point A to point B dramatically influences the total cost. The further the destination is from the origin, the more the price is going to increase.
By the above, you can deduce that there’s a world where LTL and PTL shipping can both be an option. While we can’t objectively say one is better than the other, there exists a few generalities:
- LTL and PTL fluctuate too much in price to say one is cheaper than the other
- PTL is typically faster
- LTL has more options and is more opportune for a smaller-medium sized business trying to get off the ground
- LTL will add more vulnerability to your shipment than PTL
- PTL won’t adhere to NMTFA
In which case, the only time LTL or PTL could rise above the other is circumstance-based. One may be better for your specific type of shipping. Despite this, if you’re currently looking at LTL but fall in the PTL category too, we encourage you to explore both options, as one could save you more money and produce better results.
The freighting industry is painfully and beautifully dynamic. The interconnected, multi-layered vessel relies on multiple large and tiny entities to operate efficiently. And yet, even within the synchrony of all these pieces, those handling the communication usually have the hustler mentality ingrained in them. Meaning, outside of regulation there is little set in stone.
What we’re saying is that the price, rate, and type of shipping are always up for negotiation. Be it PTL, LTL, FTL, there is always room for negotiation. Even shippers and freight carriers that have long standing relationships tend to renegotiate their contracts every few years.
Given the nature of the industry, these negotiations are typically carried out by liaisons, as the freighter to shipper relationship is usually bridged by a host of intermediaries.
What can a freight broker do for me?
First and foremost, given into account that you’re trying to decide between FTL and PTL, an experienced freight broker should be able to consult and advise on which type of shipping to choose. This choice, of course, will be based on your specific needs as a business.
Fundamentally, a freight broker is a liaison between freighter and shipper, one who has no vested interest in either party but works for the mutual benefit of each. They’re the person that should foster the relationship, execute the contract, oversee logistics, and oversee any sort of ongoing communication.
The aforementioned negotiations are almost always carried out by a freight broker that has multiple contacts within the industry. They’ll sit down and analyze your needs as a company, then shop those needs to multiple different freighters, ultimately choosing one that aligns with your requirements. Then, they will mitigate any distrust or initial business aggression in hopes to arrange an agreement that satisfies both the shipper and the carrier.
If you’re looking to decide between certain types of shipping, or to find carriers that offer a type of shipping you think will benefit your company, we recommend utilizing a freight broker’s expertise. At the very minimum, they’ll be able to point you in the right direction.
With the many parts of the shipping industry, LTL and FTL stand to be the most dominant types of shipping. One is aimed at established businesses with massive shipping budgets, while the other towards smaller-medium sized businesses. The rarer PTL isn’t in the same running as LTL and FTL, but it can be a hidden gem for a company that can utilize it. If that’s you, then reach out to a freighter or broker and see what PTL can do for you!