When organizing a cargo shipment, you need to make a decision whether to ship FCL or LCL. Each shipping method may actually work, but one might suit your needs better at a selected time. Let us guide you through the pros and cons of shipping FCL or LCL to make it easier for you to decide what shipping method is best for your current business needs.
What is FCL vs LCL?
Are you not sure what the terms FCL and LCL mean? FCL is an acronym for Full Container Load, and LCL is an abbreviated form for the term Less than Container Load. FCL entails contracting the full container space for your shipment alone. With LCL, you share the container space with other shipments.
By the way, if you want to make sure you are up-to-date with your shipping terminology—check out our logistics glossary.
FCL vs LCL: pros and cons
Let’s start by looking at cost. The lowest price per unit of freight is always the FCL option, assuming you have filled the container with enough volume. By booking the entire container, it becomes easier to manage compared to the added admin and handling work needed to consolidate LCL shipments.
FCL is priced a flat rate per container. LCL shipments are normally priced by volume, specifically CBM, which means that the more space in the container you require, the more you pay.
There is a tipping point, usually from 10 CBM, when cost-wise it will make more sense to book FCL instead of LCL even when you do not fill the entire container. To add, the maximum weight of 1 CBM is 1 ton and if your shipment exceeds this, you will also be charged more.
However, by shipping LCL, you are able to keep your inventory low and save money on warehousing the goods. This is especially valuable if you regularly deal in LCL-quantities, and it would not make sense for you to increase order sizes from suppliers.
In terms of delivery speed, as FCL requires less handling, it will generally be delivered quicker. LCL shipping, on the other hand, is a more complex process that requires many additional steps.
The service provider needs to take care of loading, unloading separating and consolidating shipments, and processing multiple documents per container. You may also need to wait for other cargo heading to your destination to arrive before the container is ready for shipping.
Every added step to a shipment adds time and a risk for further delays. If an issue arises with another shipment in the consolidated container, for example in customs clearance, all shipments in that container may be affected.
Tracking an FCL or LCL shipment is the same during transit, as both shipping methods will be trackable via the Bill of Lading. LCL becomes more difficult to track accurately when the shipment is being handled, such as during consolidation or unloading.
Due to the added manual handling and sharing a container with other shipments, there is a higher risk of damage and loss for LCL shipments. If your shipment is consolidated with special goods or heavy goods, depending on how they are placed in the container, they can cause damage to your shipment during transit.
That being said, if you need to split your shipment, it is easier to do so when shipping LCL as the container is going to a terminal or warehouse anyway for sorting. FCL offers less flexibility in terms of multiple destinations. If you ship FCL, you will need to factor in added costs for storage and handling, or ship multiple containers.
The final factor is container availability, as during peak shipping season it can be very difficult to book FCL. In these cases, it might be quicker and better to split your shipment into LCL instead of waiting for a full container to become available.
FCL vs LCL: Conclusion
To summarize the findings, we have created a handy table for an easy overview.
There are benefits to both and, in all likelihood, one shipping method will more suited to your conditions.
If you are not able to fill the container with enough volume, then FCL might not be the most cost-effective option for you. However, if you want to retain as much control over your shipment as possible and value delivery speed and security, FCL is the option to go for. When you value lower inventory and lower sourcing risks, then LCL is probably the best option.
In conclusion, the choice between FCL or LCL shipping will be determined by your needs and abilities.
Here at rouvia, we’re experts in FCL transports and would be excited to introduce you to a more efficient way to plan, book, and manage container transports. Simply get in touch with us to get started.