What Is Consolidated Shipping? Benefits and Challenges
by Jaidyn Farar
Whether you’re zone skipping or simply transporting products that are too big to be sent as parcels, consolidated shipping is a great way to keep costs low. What is consolidated shipping, and what are the pros and cons? Let’s dive right in.
What is consolidated shipping?
Consolidated shipping, also known as consolidated freight, is a shipping method where multiple smaller shipments from different sellers are combined into a single larger shipment to save on costs and improve efficiency.
The consolidated shipping process kicks off when a logistics provider collects individual shipments—usually headed to the same region—and bundles them into one freight load. After passing through multiple different checkpoints, or hubs, the consolidated load reaches its destination hub. From there, individual shipments are sent to their final destinations.
Shipment consolidation allows businesses to save on costs without sacrificing delivery reliability. It’s a great transportation method for smaller shipments that don’t fill a truck or container on their own.
Understanding freight shipping options: LTL vs. FTL
Before moving on, a quick note about the difference between LTL and FTL shipments. LTL (less than truckload) and FTL (full truckload) are two common freight shipping options.
LTL shipments are smaller loads that don’t fill an entire truck; multiple shipments from different businesses share the space and cost. This is where consolidated shipping comes into play!
FTL shipping, on the other hand, means a business uses an entire truck for its shipment. This shipping method is usually faster and safer, making it ideal for high-value or time-sensitive goods, while LTL is the more cost-effective choice for smaller, frequent shipments.
Shipping by sea? The terms LCL (less than container load) and FCL (full container load) are essentially equivalent to LTL and FTL—the only difference is the mode of transportation.
Benefits of consolidated shipping
Why use consolidated shipping? In addition to reducing costs, consolidation helps keep shipments safe, streamlines customs clearance when shipping internationally, and reduces your carbon footprint.
Lower costs
Consolidated shipping helps businesses cut costs by sharing transportation expenses with other shippers.
Instead of paying for unused space in a truck or container, you only pay for the space your shipment takes up. This is especially useful if you frequently ship smaller loads that wouldn’t justify the cost of a full truckload.
Greater shipment security
With consolidated shipping, goods are often crated or palletized. Because products aren’t handled individually, the chances of damage or loss are reduced. This means fewer insurance claims, lower replacement costs, and a more reliable experience for your customers.
Faster customs clearance
Anyone who’s shipped internationally knows that shipments often get held up at customs due to incomplete documentation or inefficient processing.
With consolidated shipping, a logistics provider manages the paperwork and ensures everything is properly documented, leading to smoother and faster clearance. The result? Fewer delays, unexpected storage fees, and missed delivery deadlines.
Lower environmental impact
By combining multiple smaller shipments into one, you reduce the number of vehicles needed for transport. This leads to lower fuel consumption and fewer carbon emissions, making your shipping operations more sustainable.
Not only is this better for the planet, but it also aligns with growing consumer demand for eco-friendly business practices.
Challenges with consolidated shipping
Of course, consolidated shipping comes with challenges too. Below, we’ll review a few of the most common ones.
Complex coordination
Consolidated shipping requires careful planning to match shipments with compatible destinations, timelines, and handling requirements. If your business's shipment doesn’t align well with others going to the same region, you might have to wait for a consolidation opportunity.
Longer delivery times
Since consolidated shipments involve multiple businesses’ goods being combined, routed, and sometimes transferred at distribution hubs, shipments don’t always take the most direct path to their final destinations.
This can result in slightly longer delivery times compared to FTL shipments, which could be a concern if you’re operating on tight deadlines.
Easily integrate with top LTL carriers
If your business is looking to integrate with top LTL carriers—without the hassle—EasyPost Enterprise Shipping is here to help.
EasyPost Enterprise is a shipping platform built for high-growth, high-performance shippers. It provides access to over a hundred shipping carriers, supports over one million shipments per day, and seamlessly integrates with other industry-standard logistics solutions.
Learn how EasyPost Enterprise helps with consolidated shipping.