Less Than Truckload (LTL) freight makes up about 10 to 15% of everything being shipped these days. For smaller quantities of goods, it’s usually the most cost-effective type of freight. But, what is LTL freight? And how does it compare to full truckload (FTL) freight?
In this guide, we’ll explain:
- What LTL freight is
- How LTL differs from FTL shipping
- What factors influence cost, class, and tracking
- Strategies for optimizing shipments
- How real-time tracking and Internet of Things (IoT) solutions can improve visibility
What Is LTL Freight and How Does It Operate?
LTL freight is a shipping method you may use when you don’t have enough goods to fill up an entire truck. Paying for an entire truckload when you’re only using a portion just doesn’t make sense.
In most cases, multiple shippers share space on the same vehicle, each paying for their share of the total weight. This type of structure reduces overall freight costs while still hitting fulfillment deadlines.
LTL freight carriers use advanced transportation visibility and tracking systems to efficiently manage the movement of goods and lower your costs. The result? LTL shipping provides a flexible and cost-efficient approach as part of your supply chain success strategies. When you have real-time transportation insights, you get comprehensive visibility into every shipment’s location, status, and delivery performance.
Consolidation and Hub Networks
One key feature here is package consolidation. By combining smaller shipments from multiple customers on a truck, freight haulers can optimize their trailer capacity. At the same time, shippers share the costs of delivery, resulting in lower charges for each shipper.
Typically, this process follows the hub-and-spoke model, where shipments move from local terminals (spokes) to a regional distribution hub or a 3PL logistics provider. Goods are then sorted and sent on their way to their final last-mile destination.
You get a more efficient and less expensive shipping method, but it does require more handling and transfer, often between multiple LTL freight carriers. That’s why advanced tracking systems with IoT sensors are crucial to provide traceability through multiple hubs and carriers.
Palletization and Cost Allocation
Typically, LTL freight employs standard pallets, which can simplify handling and reduce the risk of in-transit damage.
Shipments are classified by a freight class, taking into account weight, density, and product type. This determines freight rates along with distance and any extra (accessorial) services, such as lift-gate or white glove service. When figuring out costs, check out an LTL freight class calculator, starting with the freight class listed in the National Motor Freight Classification (NMFC) system.
LTL vs FTL: Understand the Differences
While both LTL and FTL move goods by truck, there are key differences to note before you decide on your best option.
What Is LTL vs FTL?
Let’s put them side by side.
| Feature | LTL (Less Than Truckload) | FTL (Full Truckload) |
| Shipment Size | 150–15,000 pounds, partial truckload | Fills an entire trailer |
| Cost Structure | Pay only for the space used | Flat rate for the entire truck |
| Transit Times | Longer due to multiple stops and transfers | Faster, direct to destination |
| Handling | Multiple handling points through terminals | Minimal handling, reduced risk of damage |
| Typically Best For | Smaller shipments | Large, high-volume, or time-sensitive loads |
Choosing the right shipping method is vital to keeping costs under control. For smaller shipments, LTL offers flexibility and cost savings. For high-value or urgent freight, FTL may be the better choice despite the higher costs.
The Key Benefits of LTL Freight
Let’s break down specific benefits shippers appreciate when choosing LTL freight for deliveries.
- Cost Efficiency: Only pay for the trailer space you need, delivering cost savings compared to booking an entire truck.
- Flexibility: LTL shipping adapts easily to variable order sizes and timelines.
- Environmental Benefits: Help reduce the number of trucks on the road, lowering fuel consumption and emissions.
- Accessorial Services: Add special handling, such as lift-gate delivery or inside pickup for diverse industries and facility types.
When you have IoT visibility tools and tags on shipments and a real-time visibility system to monitor shipments in transit, you have a comprehensive way to identify where every shipment is at any point in the delivery.
When to Use LTL Freight
As a rule of thumb, LTL shipping works best for smaller shipments or when your freight wouldn’t fill an entire truck.
This model works especially well for manufacturers, retailers, and suppliers that manage inconsistent order volumes. It also helps reduce unnecessary freight costs by combining loads that might otherwise have to be shipped on a half-empty truck.
Can You Ship LTL Without a Pallet?
You can ship LTL freight without palletizing, but it’s not typically a good idea.
With LTL shipments, freight is typically loaded and unloaded multiple times. It might pass through multiple hubs or go through cross-docking in distribution centers. LTL often involves different LTL freight companies. Make a note: The more handling your goods go through, the more opportunities there are for damage, especially when they’re not packed tightly on standardized pallets.
Using pallets and shrink wrapping is usually your best bet to protect your freight and provide more accurate LTL freight tracking during transfers.
Overcoming Visibility Challenges and Optimizing LTL Shipments
LTL freight shipping has unique challenges like multiple transfers between carriers, terminal sorting and routing, and partial loads. There are a lot of steps between you and your customer that make it more complex than taking a full truckload from your warehouse to your customer’s location.
Visibility becomes more challenging (and more essential). Multiple carriers also mean multiple data sources, spread among freight brokers and 3PL/4PLs. You need a comprehensive data-driven visibility platform that tracks data from multiple carriers and IoT devices. A unified view lets you track shipments more accurately.
The best systems also provide alerts on delays or route deviations in case you need to adjust delivery notices to customers. Modern IoT sensors can also do much more than track location, such as monitoring conditions. For example, you can keep an eye on temperature that might affect goods or “shocks” where goods are jostled.
Real-World Examples and Applications
Let’s take a look at some real-world examples and how different sectors use LTL freight.
- Automotive Original Equipment Manufacturers (OEMs): Move smaller batches of components to assembly plants, supporting lean manufacturing and just-in-time production
- Automotive Suppliers (Tier 1 and 2): Synchronize parts delivery with OEM schedules and maintain efficient production flow
- Commercial and Industrial Manufacturing: Replenish raw materials, deliver finished goods, and balance production cycles
- Agriculture Manufacturing: Optimize delivery costs for equipment parts, seed, or chemical shipments, especially in rural and regional markets
- Aerospace Material Manufacturing: Transport sensitive materials and subassembly components between facilities or to manufacturing centers
In each case, LTL freight provides a flexible and cost-effective solution for industries handling smaller, more frequent shipments. For high-value shipments, pairing LTL operations with advanced IoT visibility tools also helps you track security, handling, and delivery.
Surgere: Enhance LTL Freight Visibility and Control
Visibility defines the success of LTL freight operations, and that’s where Surgere delivers measurable impact.
With IoT-driven solutions, Surgere enables real-time asset tracking and shipment monitoring throughout your supply chain. You get tracking and traceability while also leveraging predictive analytics that help logistics teams make better decisions and minimize risk.
You can integrate seamlessly with warehouse management systems and yard management systems to produce end-to-end visibility in a winning order fulfillment strategy.
Contact Surgere today for a demo, and experience how real-time visibility can strengthen your LTL freight strategy.
