All You Need to Know About Less Than Container Load Ocean Shipping
No need for nagging doubts about your knowledge of less than container load (LCL) ocean shipping
Like most people, you’ll have some ideas about less than container load (LCL) ocean shipping. But perhaps you need to refresh your memory on a couple of details, or maybe it’s time to ditch one or two outdated assumptions? There’s no shame in going back to the very beginning!
This introductory “101” article presents the basics of this method of ocean transportation, leading you step by step through the key features and benefits. You don’t need any prior knowledge or experience of LCL shipping.
Once you’ve read this article, you may want to expand LCL in your supply chain solution design. Try also reading – Using LCL: When to use less than container load ocean shipping?
What is LCL?
Less than container load shipping is an option for transporting cargo by ocean when you don’t have sufficient volumes to justify the cost of a full container. Moving your cargo this way means it shares the container space with cargo from one or more other shippers.
How Could LCL Work for Me?
Your cargo is taken to a warehouse or a container freight station (CFS) where it is loaded into the container, along with the other shippers’ cargo. This loading process must be secure and, for an extra level of reassurance, the container should be operated by your freight forwarder.
Once filled, the container is tendered to an ocean carrier for international transportation. At the other end, when the vessel arrives at the destination port, your freight forwarder collects the container and brings it to a destination warehouse or CFS.
Here the container is opened and your cargo is separated from the other shippers’ cargo. It’s particularly important, at this stage, to ensure there’s no cargo damage or loss. That’s why your cargo’s house bill of lading is used – this document acknowledges safe receipt of the shipped post-inspection consignment. Now your freight forwarder can deliver your cargo direct to your customer.
What Do I Pay for LCL?
The great news is you only pay for the space you use! Your cargo is measured on a per-cubic-meter (CBM) basis and your price is calculated on this as a percentage of the total container capacity. That’s very different to full container load shipping – with FCL you have to pay for the entire container, even if it’s half empty.
"A very highly utilized ocean freight container is the most cost-effective way to ship cargo."
You will also have to pay origin and destination charges, which depend on the specific incoterms of your shipment. Sometimes these charges are calculated on a per-CBM basis or as a flat fee and your freight forwarder should explain the full list of costs to you.
What Are My Benefits?
Clearly you can save money compared with FCL, as you don’t pay the full price of an entire container. Another important benefit is supply chain reliability, particularly if you’re shipping your goods at a time of container shortages. It’s easier to obtain LCL capacity so – while waiting for available FCL capacity – companies can use LCL for more time-sensitive ocean freight. To maximize reliability, pick a freight forwarder with a global LCL network and a track record of completely controlling and monitoring LCL freight end to end, from cargo pickup and container loading to arrival and unloading, and through to final delivery.
How Sustainable is LCL?
Want to cut your CO₂ emissions? Ocean transportation is much greener than air, and LCL is typically more environmentally friendly than FCL as you share the carbon overhead with other shippers. In addition, some freight forwarders provide carbon insetting options – that is, direct compensation for greenhouse gases by reducing emissions inside your organization’s supply chain. For example, DHL Global Forwarding offers the DHL GoGreen Plus program for all customers using LCL. With this, we neutralize the carbon emissions of all our LCL shipments through the use of subsidized marine biofuels and you don’t pay any extra cost for this. If required, we can prepare annual reports to show the exact amount of your CO₂ emission savings based on your annual cargo volumes, cargo weight, and trade lanes shipped.
What Are Typical Transit Times?
You’ve packed your goods, they’ve been picked up, loaded into a container, and placed on an ocean vessel. What happens next? This depends on the trade lane. Intra-Asia transits can be as short as a couple of days, while shipping from Asia to the US East Coast can take several weeks.
One thing to bear in mind is that LCL transits typically take four to five days longer than an FCL move on the same trade lane. This is because your freight forwarder needs time to properly inspect the cargo prior to loading – quality and quantity checks, export processing procedures, your cargo must be measured and photographed, cargo lashing and securing, and delivering the container to the port. At the other end of the journey, your freight forwarder takes time to recover the container from the port, safely unload the contents of the container, and conduct an additional inspection to check the quantity and quality of the goods.
Is This Extra Transit Time a Problem?
This extra transit time doesn’t have to be a problem. In the same way as you plan extra time for an FCL move instead of air transportation, with LCL you simply expand the timescale compared to FCL. Your freight forwarder should advise you about the schedule, so you can easily arrange your other timings around this.
How Secure Is My Cargo?
Moving LCL can be extremely secure, especially between two secure warehouses or container freight stations. With more than 2,800 direct LCL services per week, DHL Global Forwarding moves LCL cargo between in excess of 45,000 different warehouse pairs and we ensure all of these facilities have perimeter fencing, 24/7 security guards, extensive closed-circuit television (CCTV) capabilities, and mandatory personnel identification. For high-value or bonded cargo, our facilities also include interior fencing.
As with all modes of transportation, there’s a strong argument for securing a good cargo insurance policy for your LCL moves rather than relying on international freight conventions for compensation. Find out why shippers need cargo insurance.
How Do I Package My Goods?
There are many ways to package LCL freight. As a general rule, your cargo should be stackable and a forklift should be able to move it. Are your goods lightweight? It’s probably best you put them in a strong cardboard box, which can include cushioning and interior blocking and bracing. Meanwhile, for heavier cargo, think about crating and palletizing. Consistent box and crate sizes are likely to simplify your LCL processes. DHL Global Forwarding offers detailed consultation on packaging options. You can find out more in our detailed LCL Packaging Guideline.