What Is LCL Ocean Freight?

The LCL shipping term, sometimes substituted by “groupage,” is an acronym for less-than-container-load. It means that when you ship using this method, your goods travel in a shipping container with those belonging to other shippers. You may have the largest shipment in the container, or the smallest, or it may fall somewhere in between, but the container will never hold your cargo alone.

LCL is a preferred mode of ocean shipping for many SMEs, since they typically ship in lower volumes than their bigger competitors, and may not find it practical to accumulate sufficient shipments to fill a container.

How Does LCL Differ From FCL?

The primary difference between FCL and LCL logistics is in the use of shipping containers. LCL is as explained in the previous section of this page. In contrast, when you use a full-container-load (FCL) service, your goods will be in a container provided exclusively for your shipment.

However, this difference means that the process for LCL International shipping is different to FCL, involving more time, handling, and overall complexity, as well as a different fee structure, which can seem more complicated if you’re unfamiliar with it.

Unlike FCL shipping, for example, you will not receive a container into which you can load your goods directly. Instead, your consignment will need to be collected from where you store or prepare it, and delivered to a consolidation warehouse. There it will be grouped with other shippers’ goods to create a full container load.

The LCL Shipping Process

Groupage is the first activity that increases the time required for LCL transport, because your shipment must be unloaded from a truck or train and received into a warehouse. It may then sit in storage for a time while the consolidator waits for other consignments to arrive for groupage.

Next, the consolidator will combine your goods with other shippers’ to fill a cargo container. Only after this activity is complete will your shipment move on to a port for export clearance and loading onto a vessel.

In some cases, carriers may transfer LCL shipments from one container to another during the international stages of transportation. Even if that is not the case, after arrival and import customs clearance at the port of discharge, the container must travel to another consolidation warehouse for destuffing. That's the term used to describe the process of unloading the container and separating its contents into consignments.

Finally, your freight must be loaded onto another vehicle and transported to its place of destination.

Transit Times Can Be Less Predictable

All in all, you should expect an LCL shipment to take between five and eight days longer to arrive than a full container load. Any customs intervention during the export or import processes will add even more time. Customs delays and inspections are also more likely to occur in LCL international logistics because of the mixed nature of the container-load.

For example, even if your shipment documentation is in order, there might be issues with another shipment in the container, perhaps requiring destuffing and inspection of the entire load.

In short, transit time, and shipping costs will depend on factors that your business has no control over—most significantly, the capabilities and conduct of other shippers and their freight forwarders.

The Issue of Shared Responsibility in LCL Shipping

In LCL shipping, all shippers whose goods occupy a container, share the responsibility to minimize the chances of problems and delays. The onus is on you and your fellow shippers to comply with legal and regulatory obligations, to file documents correctly and accurately, and to package goods securely for transportation.

Be mindful that delays in the transportation of your container—regardless of whether your shipment or that of another shipper, is the cause—can inflate shipping costs in several ways. Aside from the direct cost impact of a delay, stuck shipments may also generate other expenses.

Carriers and port authorities, for example, can levy demurrage or per diem charges for holding your container. Similarly, if your container should be singled out for a physical customs inspection, you will be liable for additional fees from the customs authorities.

When to Choose LCL Ocean Freight Shipping

As mentioned elsewhere on this page, LCL shipping is especially useful for small consignments, where a dedicated container is not justifiable due to cost, practicality, or both. If you can live with longer shipping times, or your shipment is too large to transport as air freight, but too small for FCL, you have a good reason to go with less-than-container-load shipping.

You might also have a more strategic reason to choose LCL freight services. For instance:

• Perhaps your storage or dispatch facility is unable to accommodate full containers

• Maybe you frequently ship small orders to customers in widely dispersed locations

• You could be serving a small market or testing a new one

• You may wish to keep inventory levels lean and therefore, work only with smaller inbound and outbound shipments

What Types of Goods Are Suitable as LCL Freight?

Like full container loads, you can ship most types of goods as LCL freight. Remember, though, that if your cargo requires special handling or temperature requirements, you'll need to ensure your freight forwarder consolidates it with goods of the same nature. It would be bad news if your perishable commodities were packed into a standard container without refrigeration, for example. You will also need to pay more for shipping such goods, due to the need for appropriately equipped containers and specialized resources.