The Best Shipping Method for Your Supply Chain: LTL v. Shared Milkrun
In today’s world, there are countless ways that a company can move freight from one location to another. The global economy also makes cost competition very tight, so it is important for companies to carefully evaluate the manner in which they operate their supply chain. Below, we examine two methods of shipping: Less than Truckload (LTL) and the Shared Milk Run. Choosing the most efficient shipping method can have substantial benefits and be just enough to give you a cost advantage in your industry.
Benefits of LTL
A Less than Truckload shipment is typically used when the freight weighs between 151 and 20,000 pounds. If a small amount of freight needs to be shipped, the advantage of LTL is that you only pay for what you ship rather than paying for a whole truckload. In addition to this, LTL allows smaller amounts of product, parts, materials, etc. to be moved more frequently than if you waited for a full truckload to be ready, giving your manufacturing and warehouse operations just-in-time capability.
Drawbacks to LTL
With that being said, LTL shipments do have drawbacks. Because the entire truckload is not dedicated to your product alone, LTL providers will typically consolidate various freight together, adding more dock time. Because the freight is being consolidated, the product may be moved several times into different trucks along its route. This causes the risk of damage to be much greater. LTL can also be less efficient due to the number of stops to load additional freight from other companies, which in turn can cause that cost to be passed on to the LTL provider’s customers (your organization).
A Better Option…
A better option for companies who do not need to ship a full truckload is a Shared Milk Run. With this shipping method, a company still has dedicated truck space for their product just like an LTL and will share the truck with other companies. Unlike LTL, the route of a Shared Milk Run is well planned and consistent which allows for fewer stops. Because of this, the freight is only moved to the crossdock once and then onto a delivery truck, not moved from truck to truck and consolidated like an LTL shipment would be. This efficiency allows the risk of damage to be much lower. This efficiency also lowers the cost of shipping the product.
Carter Express has a unique option for its Shared Milk Run that makes this form of transportation even more beneficial. It allows a company to pay for the weight used on the truck instead of charging by freight class, which can make it much less than LTL depending on the type of freight being shipped. In addition to this, some Shared Milk Run providers offer a returnable container service, which saves money versus LTL due to the pricing by weight. It also keeps the trucks more full for much more of the route, lowering costs for the rest of their customers. If a company has smaller amounts of product that they will ship on a regular basis, a Shared Milk Run is definitely the better option.
As you can see, it is crucial for companies to determine the most cost effective and efficient way to move their product along their supply chain. Doing so can have financial benefits and ensure your product arrives at its destination in the intended condition.
Carter Logistics can assist you by determining if your current shipping methods are the most cost saving and efficient. Contact us today to discuss your shipping needs!