It seems like every day we hear about the global supply chain crisis. One logistics challenge is getting a partial load from one location to the next. One option is to take that freight to a carrier taking less-than-full loads. Another way to go is to use consolidated shipping. Consolidated shipments have benefits for the shipper, the fleet, and the environment.
What is consolidated shipping?
When multiple less-than-truckload (LTL) shipments are combined together in the same trailer, that’s known as consolidated shipping. Instead of traveling from point A to point B with only 100 pounds of cargo, shipping companies pull together several smaller cargos to fill any remaining space. You’ll also see consolidated shipments travel by air and sea.
Typically, the company providing the consolidated shipping services manages the combining of loads. It’s up to the company to find other cargo to share the trailer or shipping container with that customer’s freight. The goods are generally put on pallets and then aggregated for delivery to their destination. Once the consolidated shipment arrives at its destination, the individual loads get divided back up for last-mile delivery.
Benefits of consolidated freight shipping
Many industries take advantage of the benefits of freight shipping. After all, the shipper gets the advantage of preferred rates. When a shipment is too small to fill a container or truck, it can be consolidated with similar shipments. Then, the shipper benefits from the economy of scale and pays only for their portion of the load. Considering that the average dry van trailer is 53 feet and can carry up to 4,500 pounds of weight, there’s a lot of room for consolidated shipments. After all, you can fit 32 40×48” pallets in a typical dry van.
Consolidated freight shipping can also help shippers and manufacturers meet customer expectations. As it is less than ideal to send a LTL shipment out on the road, another option would be to wait until there is enough demand to fill that truck or container. That could hold up delivery. On the other hand, with consolidated shipping, the many people looking to ship smaller loads to a similar destination around the same time can all see their cargo get out on the move sooner.
Consolidated shipping reduces the chance of damages too. LTL shipping uses a hub-and-spoke model with the cargo getting transferred from truck to truck at different stops along the way. Consolidated shipping companies, on the other hand, are more likely to only move the freight from consolidation center to receiver.
Fleets benefit from offering consolidated freight shipping as well. Any time a vehicle is on the road, there are costs involved. Not only are they paying drivers, but there are fuel costs and the vehicle wear and tear to consider. Having a consolidated load means a full truck and more revenue from that route.
Who’s responsible for the consolidated shipment?
As there are multiple shipments involved, the shipping company is responsible. The company should have a freight forwarders liability insurance. Of course, the shipper needs to provide the proper delivery address and pack the shipment well. Yet, some consolidated shipping companies will even repackage the smaller boxes into a bigger one to help secure the items and reduce damage risk.
The consolidated shipping company is accountable for the timeline provided. Yet, the shipper should find out how long it takes to consolidate shipments to plan accordingly for delivery.
What industries typically use consolidated freight services?
Many industries rely on consolidated freight shipping to get LTL loads to the destination while lowering costs and environmental impact. Industries that regularly ship using consolidation include:
- Retail stores
- Grocery stores
- Health care
- Appliance delivery
- Storage services
- Furniture movers
- Chemical businesses
- Food & beverage
Common challenges faced by consolidated shipping companies
Consolidated shipping takes a great deal of planning. Unlike with a full truckload (FTL), the company needs to organize many smaller shipments and communicate with multiple customers. Dimensions, timing, and other shipment specifics can all factor into the planning of that consolidated shipment’s route and pricing.
There are also more steps involved in consolidated freight shipping. To ensure deadlines are met, the company must account for the added time involved in consolidating and dividing up the shipments.
Limited resources can slow the consolidation process, which may require the company to outsource labor. There are also safety considerations when that shipment is loaded, whether it’s into a container for air, sea, rail, or over-the-road transport.
How Motive can improve your consolidated shipping services
Delayed service and delivery is a problem in any shipping efforts. Consolidated shipping services face the added challenge of aggregating and later separating again the freight. Plus, you are communicating with many more customers to organize and plan the shipments. Motive’s AI-driven platform can help improve shipping services by reducing the challenges associated with combining loads and monitoring shipments.
With a fleet management platform, you enjoy total visibility into that consolidated shipment. Get notifications when shipments are loaded or use GPS asset tracking to know where they are at any given time. This can help you inform customers about estimated arrival times and better manage their expectations in the event of a delay.
Fleet management can also reduce risks with route optimization and real-time alerts. Our solution positively influences driver behaviors and supports a safety-first culture. You can also use geofencing to protect cargo and assets. And using our integrations with your ELDs to track service history and monitor asset health helps keep your vehicles in good shape.
Consolidated shipping has many advantages and is widely accepted as a shipping solution for many industries. Manage and grow your consolidated shipping service with Motive technology. Request a demo today to see the benefits for yourself.