Less-Than-Truckload (LTL)

What is Less Than Truck Load (LTL)?

Less Than Truck Load (LTL) is a road freight shipping method for transporting relatively small shipments that do not require a full trailer. In LTL shipping, multiple shippers’ pallets or crates are consolidated into one truck, with costs shared based on space used, weight, distance, and service requirements. LTL freight is typically palletized, handled through terminals, and tracked as it moves through a carrier’s network.

How LTL Works in Road Transportation

LTL carriers operate hub-and-spoke networks. Shipments are picked up locally, brought to a terminal, consolidated with other freight headed in the same direction, and then linehauled to destination terminals for final delivery. This process, often involving cross-docking, allows carriers to optimize capacity and route density.

Key aspects of LTL operations:

• Palletization and labeling to protect freight and streamline handling.

• Terminal transfers for consolidation and deconsolidation.

• Linehaul movements between regional and national hubs.

• Final-mile delivery with accessorial services as needed (e.g., liftgate).

LTL is ideal for 1–6 pallets, partial cubic capacity, or freight that is too large or heavy for parcel but too small to justify Full Truck Load (FTL). Compared to FTL, LTL generally has longer transit times and more handling, but significantly lower cost for smaller volumes.

Pricing and Key Components

LTL pricing reflects the shared nature of capacity and the complexity of terminal handling:

• Weight and distance: Heavier loads and longer hauls cost more but benefit from economies of scale.

• Space/dimensions: Charged by pallet position, cubic meters, linear meters, or dimensional weight.

• Freight class/density: In some markets, rates depend on commodity class or density (higher density often means lower class and lower cost).

• Accessorials: Extra services such as liftgate, residential delivery, appointment, inside delivery, hazardous materials handling, or limited access pickup.

• Service level: Standard, guaranteed, time-definite, or expedited options.

• Claims and liability: Carrier liability limits apply; cargo insurance may be advisable for higher-value goods.

In the U.S., carriers commonly apply fuel surcharges and publish fuel surcharge rate tables that explain how these surcharges are calculated.

Industry Context

In road transportation, LTL supports:

• B2B distribution for manufacturers and wholesalers shipping frequent, small replenishments.

• E-commerce and retail networks needing store or fulfillment center replenishment.

• Cross-border groupage in Europe and regional distribution in North America.

• Just-in-time supply chains where regular small lots keep inventory lean.

• Sustainability goals via higher trailer utilization and reduced empty miles.

Shippers often use Transportation Management Systems (TMS) to rate-shop, consolidate orders into efficient LTL tenders, print labels and bills of lading (BOL), and track shipments via EDI/API events; the essential TMS features every transportation company needs include consolidation, multi-stop planning, rate shopping, and billing automation.

Examples

• A furniture manufacturer ships three pallets weekly to multiple dealers. LTL consolidates these pallets with other freight, cutting costs versus booking a full trailer.

• An automotive supplier sends two euro-pallets to a nearby assembly plant on a fixed cadence. LTL provides predictable transit and dock appointments without paying for unused trailer space.

• An e-commerce brand ships bulky items (e.g., fitness equipment) requiring liftgate delivery. LTL with the appropriate accessorial ensures safe curbside delivery.

Benefits and Considerations

Benefits:

• Cost efficiency: Pay only for the trailer space you use.

• Flexibility: Suitable for variable volumes and multi-stop distribution.

• Network reach: Extensive terminal networks enable regional and national coverage.

• Sustainability: Higher load factors reduce emissions per unit shipped.

Considerations:

• Transit time: Typically longer than FTL due to terminal handling and consolidations.

• Handling risk: More touchpoints can increase risk of damage; proper packaging is essential.

• Accessorial planning: Specify required services up front to avoid delays and unexpected charges; plan for possible wait time at docks—detention time can add cost and disrupt schedules.

• Accurate data: Correct weights, dimensions, and classifications prevent reweigh/reclass fees.

From a commercial standpoint, operating without a modern TMS introduces hidden expenses such as administrative rework, routing inefficiencies, and surcharge errors that can erode LTL margins.

Related Terms

• Full Truck Load (FTL): Dedicated trailer for one shipper’s freight.

• Groupage: Common European term for LTL-style consolidated road freight.

• Partial Truckload (PTL): Larger than typical LTL but not a full trailer; often point-to-point with fewer touches.

• Cross-docking: Terminal process of transferring freight between inbound and outbound trailers without long-term storage.

Conclusion

Less Than Truck Load (LTL) shipping enables cost-effective, flexible road transport for smaller freight volumes by consolidating multiple shipments in one trailer. When paired with accurate data, proper packaging, and clear service instructions, LTL delivers broad network coverage and solid reliability while optimizing cost and capacity across modern supply chains.