What is consolidated shipping and why is it important?
August 11, 2017
A consolidated shipment is the result of combining multiple LTL shipments from various shippers into one full container (multi-stop truckload) shipment. Consolidated shipping allows shippers to earn preferred rates and helps optimize supply chain logistics by saving time and reducing cost.
Consolidated shipping is ideal for someone that might only have a few pallets of freight or smaller shipments they need packaged and shipped in one container. More often than not, shipments will arrive from various locations and suppliers, and in order to avoid paying a higher rate, shippers will consolidate them into one single shipment.
To help break down consolidated shipping and why it’s so important, we wanted to provide clarity around the term and its relationship with the freight industry. To do so, we’ve outlined a few of the benefits and potential challenges.
Benefits of consolidated shipping.
Cost efficient: Many shippers believe this is the most important benefit of consolidation. If you only use half or two-thirds of a trailer, you will typically still have to pay for the entire space. Consolidation allows you to combine multiple LTL shipments that are traveling in the same vicinity into one full truckload shipment, while only paying for the space that their freight takes up.
Reduced damage risk: Even with all the advancements in freight shipping, damaged freight is still a lingering issue. Consolidated shipping uses a method that not only is more cost efficient, but also considerably reduces the on-again, off-again handling of the product, as freight only has to travel between the shipper, consolidation center, and receiver/consignee. With fewer touchpoints, the risk of damaged goods is significantly lowered.
Improved quality control: Another benefit of consolidation is that it allows you to take control of your goods sooner. If for some reason quality control alerts you that there’s a problem with your shipment and it’s already been shipped, you would normally have to wait for the supplier to send a replacement, thus meaning that the timeline of delivering the product is now out of your hands. Consolidation allows you to perform quality control measures as soon as the product even reaches the warehouse, which in turn reduces the chances of losing time and control due to unforeseen problems with your order.
Potential consolidated shipping challenges.
Securing a carrier: Due to the added complexity of consolidation, not all carriers are willing to transport consolidated shipments. Even when you are able to successfully find a carrier that’s willing and able to transport consolidated shipments, be sure that you are well informed of this carrier and that you are being charged correctly. Partnering with an online freight service provider can help to assure you get a fair rate when determining the right carrier and also allows you to access the carrier network.
More time spent planning: Although not necessarily a bad thing, consolidated shipping requires additional time spent organizing and planning. You will need to be extra careful and aware of factors such as pricing, dimensions, timing, and many other specifics to guarantee that their delivery arrives both safely and promptly.
Time consumption: As briefly mentioned before, consolidated shipments can occasionally (typically) take more time than other FTL shipping methods due to the need for additional steps within the process (consolidation and deconsolidation). Before planning a consolidated shipment, shippers must be aware of the entire process and plan accordingly.
Is consolidated shipping a good option for me?
Consolidated shipping by ground is a cheap (cost effective) and efficient way to move freight. This type of method is ideal for someone who is transporting palletized freight. One of the requirements of palletized shipping is that it has to be able to move seamlessly across the dock. Clearing a customer’s dock creates a more organized and productive distribution center.
It’s crucial that shippers have a complete understanding of the way consolidation works in order to ensure proper delivery. One of the best practices of consolidated shipping is to use a dependable consolidator with proven experience so you can ensure your shipments will be properly accounted for.
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