Understanding LCL Shipments: Costs and Operations

Given the multiple routes available for shipping, exporters have a wide array of options to choose from. The primary focus is always on securing favorable shipping conditions. Several factors must be evaluated before finalizing the shipping container, such as time sensitivity, the size and nature of the product, and the container's dimensions.

Containers stacked at a port with a crane moving one. Text reads, "LCL Shipments Made Simple—Understand the Costs, Process, and Benefits."

The shipping containers are standardized by the International Organization for Standardization (ISO) and come in sizes of 8, 10, 20, 30, or 40 feet. When the package size is significantly smaller than the container capacity, sharing container space with other exporters (LCL) becomes a cost-effective option.

Image of two cargo containers, one labeled as 'FCL' and the other as 'LCL,' placed side by side. The image highlights the differences between Full Container Load (FCL) and Less Than Container Load (LCL) cargo, including the amount of space utilized and the shipping cost. The heading 'Full Container Load (FCL) vs. Less Than Container Load (LCL)' is displayed prominently on the image.

LCL Shipment - Meaning

LCL, or Less than Container Load, is when exporters share container space due to having goods that do not fill an entire container. This approach reduces costs for both the shippers and the shipping companies, promoting more eco-friendly and sustainable shipping practices.

Trivia: Another term for LCL shipments is "groupage shipments," reflecting the grouping of smaller packages.

How does the procedure in LCL Shipment Work?

Registering with a Shipping Company: Selecting the right shipping partner is crucial for a seamless delivery process.
Providing Package Information: Once you contact the shipping company, you'll need to provide details like destination, package dimensions, and collection time. This information helps in grouping your shipment with others heading in the same direction.
LCL Dispatch and Shipping: Your package is taken to a warehouse near a port, where it's combined with other shipments for the same route in a process called 'Container Stuffing.' The container is then loaded onto a ship.
Arrival and Delivery: Upon arrival, the container is offloaded into a warehouse for deconsolidation. After separating the packages, they are delivered to the final recipients.

Costs/ Charges included in LCL shipment.

The cost of LCL shipping includes various stages like handling, consolidation, and deconsolidation at warehouses, which can sometimes exceed the cost of sea transport itself due to labor and infrastructure needs.

Pricing: Typically calculated per cubic meter (CBM) in USD. If the shipment exceeds 1,000 kg, then charges might be weight-based, though this is less common with LCL due to its focus on smaller loads.

Calculating the CBM of your LCL shipment

To find your shipment's volume in CBM, measure the package's length, width, and height in meters, then multiply these dimensions. For example, a package of 3.2m x 3.5m x 4m would have a volume of 44.8 CBM.

Note: LCL shipments are generally 20ft and 40ft standardized containers by all the major shipping companies internationally.

What is the difference between FCL and LCL?

Speed: FCL is faster as it avoids the multiple stops of LCL.
Safety: FCL is preferable for fragile items due to less handling.
Logistics: LCL is more inventory-friendly, allowing for smaller, more frequent shipments.
Costs: While LCL can be cheaper for smaller shipments, its per-CBM rate is higher than FCL's. There's a threshold where FCL becomes more cost-effective, even if not fully filling a container.

The higher cost of LCL compared to FCL stems from the additional logistics of grouping and ungrouping, plus the risk of not fully utilizing the container space.