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5 Shipping Modes Explained

Posted by Mihlfeld & Associates on Oct 7, 2019 8:04:55 AM

Choosing the right mode of freight can save money, save time, decrease damages, reduce errors, and increase efficiency. Additionally, specificity is important and understanding different modes of shipping as well as adopting the appropriate terminology can help clear up any ambiguity from referring to everything as simply, “freight.” This article will define the most common shipping modes and examples of when each is applicable or your best choice.


  1. Parcel shipping (Small Package Shipping) is ideally meant for smaller packages that can be moved quickly and easily. Parcel is also referred to sometimes as Small Pack (short for small packages). This type of shipping involves individually labeled and shipped boxes like Amazon or other retailer packages delivered to your door. Parcel shipping has a higher amount of checkpoints and transfers, which also adds to the risk of damage and loss. Parcel is most common and applicable when you have an item of small dimensions, low in weight to ship, or you have several, but they are all going to different places. The most known parcel carriers in the US are UPS, FedEx, and DHL. They have different specifications, which also change periodically, but parcel is usually anything under 5-6 feet long in any direction and under 100-150lbs depending on various circumstances.


  1. LTL Shipping stands for “Less Than Truckload.” LTL shipping is used when freight does not require a full trailer or a direct route from point A to point B. LTL can include freight that is bulky or unique all the way to dense tightly palletized freight. LTL will have less transfers and checkpoints than parcel shipping which will also decrease risk of damage or loss of shipment, but there are more stops and transfers than FTL. LTL carrier use a Hub & Spoke method, so trucks pick up freight in their area and drive it to the closest hub. From that hub the freight is then transferred onto a truck and taken to the hub that is closest to the final destination. From the destination hub, a truck will take it to the final destination.


With LTL, a company only pays for the space that their freight occupies in the trailer while other shippers pay for the remaining space that is occupied by their shipments. LTL trucks stop at multiple destinations, meaning transport times can be a little longer. However, it’s often cheaper than FTL shipping, because you only pay for the space your freight takes in the truck. For example a truck going to a retail store may have products from five different manufacturers such as coffee filters, paper towels, dishwashing detergent, or trash bags.


  1. FTL or TL means full truckload or truckload. Full truckload shipping is the ideal method if you have a large shipment that will fill an entire trailer or at least exceed the volume LTL options. Typically full truckload shipping costs more than LTL shipping. However, the benefits of FTL might outweigh that cost. With FTL shipping, the truck goes directly from Point A to Point B without any stops, making transportation times shorter. Also, there is no risk of goods being offloaded at the wrong location or damaged from other shipments being loaded or unloaded. Truckload also encompasses any specialty transportation like tankers, flatbeds, or materials that cannot be shipped with other materials, i.e. hazardous chemicals.


  1. Intermodal Shipping refers to shipping with a combination of rail, truck, or ships. There are several reasons to consider exercising intermodal; including rail in your freight shipping can reduce fuel use, lower costs, and offer a reliable shipping method. Intermodal freight is transported in a container that is compatible with container ships, semi-trucks, and trains. Containers for intermodal freight must adhere to strict International Organization for Standardization (ISO) dimension guidelines. This often allows the freight to remain in the container when transferred between modes of transportation. The emergence of standardized shipping containers has allowed products and raw materials to travel faster and at a reduced cost.


This mode is useful when shipments must travel overseas or need to be moved across long distances. However, this mode is slower and less flexible than Truckload or Less-than-truckload. Time sensitive freight like produce or shipments small in size or weight are not ideal for intermodal shipping. However, commodities such as coal, steel, and oil are ideal for this mode of freight as well as large shipments that can fill a 20’ or 40’ container.


  1. Expedited Freight refers to time-sensitive shipments in which freight has to be delivered within a specific time frame. Expedited freight is most often transported by truck or air. Trucks shipping expedited freight rarely stop along the way to deliver or pickup additional shipments, making the expedited shipment the priority. Expedited shipments are both large and small, from parcels to pallets to a full truckload of freight. With expedited freight services, the goods are tracked at all times. This gives the shipper peace of mind by knowing where their urgent shipment is at every step of the way. owever, this mode of freight is expensive making it something you won’t want to use for regular shipments unless fast delivery is a requirement for your industry such as the medical supplies and produce distribution.


There are other services that so similar under different names. Some carriers call their specialty shipping the “white glove service” or “express critical.” These services usually come with additional services than just time guarantees, such as delivery to specific floors in a tall building. It is important to note that needing a guarantee delivery date or time can be an add-on to other modes of shipping as well. For example, an LTL shipment can be sent and requested to be delivered within a specific period of time and the fee for this request is usually much less than using an expedited service. It really depends on just how fast you need something delivered and what other services you need along with that hasty delivery.



If you work in a shipping department or some other part of the shipping industry, chances are you know these terms. They have been the standard for many decades even as shipping and freight have evolved over time. However, there are many shipping adjacent colleagues who don’t know but can benefit greatly from learning this terminology. If you are the sales associate taking orders for clients and requesting a shipping order, it can greatly reduce confusion if you can speak your shipping department’s lingo. You may be in accounting or AP/AR and see some UPS bills charging $10-20 for a shipment and the next charging $675. Chances are one was parcel and the other was LTL. Interdepartmental knowledge is a must for a healthy organization.


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