What does Less-Than-Truckload (LTL) mean?
Less-than-truckload (LTL) is a shipping service for smaller loads or quantities of freight, where the goods take up less than a full truckload of space. Both large shipping companies and specialized third-party-logistics providers offer LTL trucking to accommodate the needs of businesses who frequently move small batches of goods.
In addition, less-than-truckload shippers offer economies of scale so the freight costs for individual shipments are significantly reduced; one of the greatest advantages of an LTL approach is that it’s more cost-effective and efficient for smaller shippers.
How Less-Than-Truckload (LTL) works
Less-than-truckload shipping is typically reserved for freight between 150 and 15,000 pounds. An LTL provider will combine the loads and shipping requirements of multiple companies onto their trucks (known as ‘assembly service’), which makes it less expensive than hiring an entire truck for a single, small load. In conjunction with shared trailer space, LTL shipping uses a hub and spoke model, where local terminals (the spokes) connect to the main distribution centers. This way, trucks can load freight locally, transport it to designated hubs, and deliver goods directly to their final destination (or move them onto other trucks to continue their journey).
The specifics of an LTL shipment depend on variables like a shipment’s place of origin, its destination, its packaging type, and whether it requires any special handling. Because of these variables, LTL freight shipping involves advanced logistics and planning for maximum profitability, which is why IT systems are often integrated along with this shipping method.
Many carriers will set their own rules or limitations for the dimensions of LTL freight, but generally speaking, loads of under 150 pounds are handled for the likes of FedEx, UPS, or the USPS. Less-than-truckload shipments occupy less than 24 feet of a truck’s trailer, and contain no more than six pallets in total. For optimal use of space and security in the truck, it’s common for individual packages in an LTL load to be shrink-wrapped together to form one big box.