Feed-Back Benjamin Muminovic – Shipping by sea – LCL or FCL

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LCL and FCL are two methods of shipping that any player in the international market should know. Also, these are concepts that Benjamin Muminovic knows and masters because of his field of activity.

Benjamin Muminovic is a young entrepreneur who is part of the Chinese business elite.

Thanks to his hard-working character, he has acquired impressive skills that have allowed him to obtain the professional maturity he shows today. He knows the subject of shipping methods (LCL and FCL) as he is also a specialist in the field of shipping. He agrees to help us to know more about LCL and FCL in order to know which one to adopt.

What is the FCL Muminvic Benjamin?

FCL stands for “Full Container Load”. The FCL shipping method means that you book a single container exclusively for the delivery of your goods. Since you do not share the container with another shipper, you must pay for the entire container.

FCL is the right shipping method for you if your cargo is 15 CBM (cubic meters) or larger. It can take up the space of a 20 or 40 foot container. But it doesn’t matter, because many shippers choose the FCL shipping method when their cargo is almost large enough to fill the entire container.

What is LCL?

LCL stands for Less than Container Load. The LCL shipping method means that you reserve a portion of the container for delivery of your goods across the ocean. This means that you share the container with other shippers whose goods are in the same container as yours. By using the LCL method of shipping, you are only required to pay for the space your goods use.

LCL is the right shipping option when your cargo is less than 10 CBM and cannot fill an entire container. This option is feasible even when you are shipping very small volumes, such as 100 kg, because you only pay for the space occupied.

How the FCL and LCL work

When you ship FCL goods, your service provider delivers a 20′ or 40′ container that will be loaded with your goods. Only your goods are placed in this container. A motor carrier delivers the container to the port to be loaded onto a vessel. At the destination, another carrier delivers it to the consignee.

When you ship consolidated goods, your service provider transports your goods to a special warehouse called a Container Freight Station (CFS). This is managed by a consolidator. The consolidator loads your goods into a container with those of other shippers. The container is thus shared with goods destined for consignees in several countries.

What are the advantages and disadvantages of shipping with LCL and FCL?

Advantages of FCL shipping:

– Ideal for large, heavy or awkwardly shaped cargo that cannot share a container

– Freight is generally moved or handled less frequently than LCL shipping

– Most cost-effective way to ship goods that take up at least half the capacity of a standard 20-foot (6 pallet) or 40-foot (12 pallet) shipping container

Potential disadvantages of FCL shipping:

– The shipper or supplier will need appropriate facilities to load and seal the container.

– Receiver must unload their container

– Generally less cost effective than LCL for shipments occupying less than half the capacity of a 20′ ocean container.

The advantages of LCL shipping:

– It’s the most cost-effective way to ship shipments too small to fill a container

– Ideal for shipments occupying no more than six standard pallets

– A good solution if your company can’t wait until you have enough cargo to make it financially viable to book an FCL shipment

Potential disadvantages of LCL shipping:

– Fragile goods can be damaged by frequent movement and handling.

– You cannot control which goods are shipped in the same container as yours.

– May be less reliable than FCL if your consignee needs the shipment by a specific date.

FCL or LCL: What are the main differences between these shipping methods?

Shipping volume

The ideal shipping volume is different for FCL and LCL. The shipping volume is the volume that the goods being transported will occupy in the container. The units used to measure shipping volume are cubic meters or cubic feet. This is an important factor to consider when deciding between two shipping methods.

For FCL shipments, the ideal volume is 15 CBM or more. For LCL shipments, the ideal volume is between 1 and 10 CBM. If your shipping volume is less than 1 CBM, it is recommended that you opt for air shipping, as it is more convenient for you.

Weight of the shipment 

If your shipment is small (less than one million cubic meters), you should choose LCL shipping over air freight. This is because air freight is charged by volumetric weight and the rate would be quite high.

When choosing FCL, it is important to keep in mind the size of the container, as the maximum weight rules vary by country.

Cargo security

Every shipper, including you, wants their cargo to arrive safely at its destination. But some items do not require a high level of security. These are items that are not fragile or highly sensitive to movement. If your shipment consists of such less sensitive items, opt for the LCL, as the container space is shared and the items are not very secure.

On the other hand, if you are shipping highly sensitive items, FCL is the right method because the entire container is yours. This allows for better handling and prevents the exposure of other items.

Urgent shipping: FCL or LCL

The timing of the shipment is another important difference that determines which shipping method to choose. If the shipment is urgent, FCL is the right option to choose because the shipment is fast, with no delays or stops en route.

There is no loss of time for loading and unloading at the various transshipment ports. The shipment is made by a direct route from the loading port to the destination port.

If the shipment is not urgent and you have some time before the due date, LCL is the right method for you.

Delivery appointment

LCL shipping is a more appropriate choice when delivery times are concerned. In the case of FCL, the situation is a bit difficult to manage. Indeed, in the case of an FCL shipment, there is a specific time frame during which you must receive the container, unload it and return it.

This period is usually 8 days. The situation becomes problematic when you are not able to meet the deadline, as the extra time will cost you money.

In the case of an LCL shipment, you have enough time (5 days at the port and 6-7 days at the warehouse) to receive the container, unload it and return it before the “free time”.

Amazon FBA

LCL shipments are smoother and more trouble-free than FCL shipments when it comes to Amazon deliveries. LCL shipments are received directly from Amazon and are easy to manage because of the prior arrangements and planning.

Whereas FCL shipping can be a bit cumbersome when it comes to Amazon FBA. This is because the goods being shipped must meet Amazon’s delivery criteria to be accepted by the company.

Local costs

LCL shipments are charged at a rate per CBM. These rates include local charges for the loading and delivery ports. FCL local freight charges are fixed and are based on per container charges.

Traceability    

You can track the LCL shipping container using the information provided by the bill of lading. However, the tracking result is not very accurate due to multiple handlers. The FCL is tracked in the same way as the LCL. However, the tracking results for FCL are more accurate because the container is owned by a single shipper.

Reservation of containers during public holidays in China

Booking LCL shipments during the holiday season is not very difficult. Consolidators do their best to make room in the container and avoid sending empty containers. On the other hand, booking an FCL shipment during the holiday season (long vacations in China, Chinese New Year) is difficult because of the low availability of full containers.

Split shipment

Split shipping is easier with LCL because the shipment is unloaded at the warehouse to sort the shipments for different recipients. Split shipment under FCL will cost you additional fees because FCL goods are usually not unloaded at the warehouse.

Customs clearance and examination

The clearance method is similar for LCLs and FCLs. However, the customs examination may differ between the two. Customs examination is somewhat more difficult for LCL shipments because a container contains goods from multiple consignees. This makes it more likely that a shipment will be flagged by customs.

If this happens, the entire container is blocked and thoroughly checked. The cost of the customs examination process is shared among all consignees, regardless of the cargo that caused the delay.

The risks of a customs examination of an FCL shipment are low, as the customs inspection takes place randomly. And in case of an inspection, the cost is borne by the shipper alone.

What is cheaper between FCL or LCL?

The cost depends on the type of goods you are shipping. Generally speaking, FCL costs more because you have to pay the price of the entire container even if your goods do not fill it.

In fact, LCL costs less because you only pay for the volume of goods shipped. However, in some cases, LCL costs more than FCL. This is the case when your goods are fragile and cannot be stacked on top of another. This arrangement takes up a lot of space and you have no choice but to pay according to the space occupied.

Muminovic Benjamin, is there a rule of thumb for choosing FCL or LCL?

There is a general rule of thumb that can often help you decide between FCL and LCL. When you are shipping enough volume to fill more than half of a 20-foot container, FCL is probably your best choice. If you are shipping less than that, you should probably choose LCL. A 20-foot container typically holds about 10 pallets, or 20 pallets if you can add a second layer on top of the first.