Easy understanding of LCL Shipment

Easy understanding of LCL Shipment

LCL (Less Than Container Load) shipment is when you ship cargo via sea and pay freight. Cargo are loaded into a shared container with other party’s cargo for transit. If you don’t have the money or space to accommodate a full container, it makes sense to use LCL.

LCL means you ship in smaller volumes so that you can keep your inventory lean. Instead of purchasing large quantities from suppliers, you can use LCL to keep a steady flow of inventory in smaller quantities.

LCL (Less Than Container Load) shipment can be an easy & cheaper alternative option to FCL (Full Container Load) shipment.

The vital difference is that instead of filling an entire container with cargo, you are going to share a container with other importers/exporters. This mode of transport means that you don’t have to buy enough stock to fill an entire container load ,and that, instead of paying for an entire container, party is asked to pay only for the space inside of one that you use. This is particularly helpful for smaller businesses, or first-time importers/exporters who are just willing to do a small shipment by sea route.

If you are going to ship a small number of goods, or products that don’t take up much space (low volume), you should go for LCL. A lot of new party won’t be buying enough stock to fill an entire container, especially if they’re shipping low-volume items.

LCL costs more than FCL per unit of freight. Normally, freight agents prefer a full container load because it's easier for them to figuring out how to bundle many LCL shipments in a full container. This is because FCL is charged as a flat rate that, while it is more expensive to shipment thru LCL. You have to pay per CBM of space within the container for LCL shipment.

If you’re unsure about whether you’re going to need an FCL or LCL shipment, don’t worry about it too much, regardless of which one you’re going for, you’ll need a Freight Forwarder and when they’re helping to quote your shipment, they’ll communicate you whether your goods should be LCL or FCL.

With an LCL shipment, you have more “free time” usually about 5 days at the port, and then 7 or so days at the deconsolidation warehouse. This makes it more likely that you will get a delivery appointment before fees begin accruing.

When an FCL shipment arrives at port, it’s unloaded from the vessel and delivered to the buyer. It’s more complicated for LCL, which requires additional steps: consolidating different shipments, processing multiple documents per container, and then sorting goods for each customer. At each step, there is potential for delay.

CBM Calculation: Cubic Meter Calculation

CBM- Cubic Meter is calculated by multiplying length (meter), width (meter), and height (meter) of packages of goods.

However, the total weight of cargo should not exceed 1 ton. That means if the cargo weight is above 1000 kgs, the volume of the cargo is treated on the basis of weight.

Freight Forwarder charges LCL rates on the basis of per CBM or per weight of 1000 Kg (1 ton) whichever is higher.

Example: If length, height and width of a cargo is 2.3 M, 1.4 M and 2.0 M respectively, the volume of cargo is 2.3 x 1.4 x2.0 = 6.44 CBM

If the measurement given in inches or centimeter, first you need to convert in meter and then calculate CBM which will be easier for you.

If Freight Forwarded is quoting   a rate of USD 10.00 per CBM, the rate will be as below

6.44 CBM x USD 10.00 = USD 64.40

If the weight of said package is 8 tons (8000 Kg) the freight on LCL is calculated on the basis of weight. That is 7.0 tons x USD 10.00 = USD 70.00

So, weight of 1 ton (1000 Kg) is treated as I CBM.

In other words, LCL freight is calculated on the value of 1 CBM or weight of 1 ton (1000 kg) whichever is higher.

Experts from “Madhab Marine & Logistics Private Limited” takes care of interests of concerned parties for LCL Shipment.

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