If you’ve ever received an especially heavy, large or oddly shaped item at yourdoorstep, there’s a good chance it traveled there via freight shipping. And mostother products you’ve purchased, whether in a store or online, were at some pointpart of a freight shipment.
Freight shipping is a method businesses use to transport bulk shipments that surpass theweight and size restrictions for parcel packages. This cargo is often packed and shippedon pallets.
Read on to learn more about freight shipping, including what’s shipped via freight,how it works, and why it’s critical to the operation of global supply chains.
What Is Freight?
Freight broadly refers to any cargo that needs to be moved from one location to anotherand does not qualify for parcel shipping. Most of the things you order online that aredelivered to your house or apartment use parcel shipping, which handles smaller packagesand boxes.
The parameters used to determine packages that qualify as freight vary depending on thecarrier, but it’s often anything that weighs more than 150 pounds, is more than108 inches long or exceeds 160 inches in length plus girth (two times width plusheight). Goods transported on a pallet are usually considered freight.
Almost any item can be freight, including large quantities of smaller goods consolidatedon a pallet. Larger products that often require freight delivery are furniture, cars,construction supplies and certain equipment for outdoor activities. The exceptions forcommon freight carriers are hazardous items like aerosols and fireworks, valuableproducts like jewels and perishables, including meats and frozen foods. These types ofproducts require more specialized carriers.
What Is Freight Shipping?
Freight shipping refers to the modes of transportation designed to get these largershipments from one place to another and plays a central role in worldwide logistics networks. This could involveships, planes, trains and trucks, and often some combination of those. Imagine aU.S.-based distributor that imports most of the goods it sells from Asia. Those goodsmust be loaded into a shipping container, then taken across the Pacific to a West Coastport. From there, a truck or train would take those items to their final destination,arriving months after they first left a port in Asia.
Unlike parcel shipments, freight shipments do not travel on the delivery trucks from UPS,FedEx and Amazon that you’re accustomed to seeing. Since these are large, heavyloads, they require semi-trucks and other modes of transportation with large capacities.
Freight shipments are usually measured based on how much space they would take up insemi-truck trailer. This could be full truckload or less than truckload (LTL), thoughthere are additional options that we’ll get into later.
Key Takeaways
- Freight shipping is one of the most important and widely used methods to transportlarge quantities of goods around the globe.
- There are not only multiple modes of freight transportation — like truck, sea,rail and air — but options for shipments of different sizes and weights to meetvarying needs and budgets.
- This shipping method is popular because it is reasonably priced, efficient and canaccommodate a wide variety of goods.
- Businesses can lean on technology to see different freight options for each shipmentand choose the best one based on cost and the delivery timeline.
Freight Shipping Explained
While it’s rare for consumer orders to arrive via freight, it’s the primarymethod through which companies receive goods. For some businesses, it’s also theprimary way they send items, so it can impact both inbound andoutbound logistics. Products companies need large quantities of parts, materialsand finished goods to manufacture or resell, so they order in bulk. Even servicesorganizations will need supplies for their offices and staff, and those often come inlarge quantities.
Freight shipping is usually more cost-effective and efficient than breaking up this cargointo smaller shipments and sending it via parcel. The processes and equipment needed tomove these large and heavy goods is very different than relatively small packages thatcan quickly be dropped off at your doorstep by a delivery van. Some of the samecompanies that offer parcel shipping, like FedEx and UPS, also have freight divisions,but they operate as separate units.
Businesses should understand their options and the rules of different carriers ratherthan defaulting to freight shipping with a known carrier. There could be alternativesthat make sense, like splitting up a smaller freight shipment into multiple smallerparcel shipments.
Freight Shipping Modes
Freight shipping is a big bucket, and there are numerous types to meet the varying needsof businesses. The volume, type and urgency of the goods being shipped all affect whichmode makes the most sense. Shipping providers should be able to provide quotes fordifferent options so you can choose the one that makes the most sense for your business.
Less than truckload (LTL):
For freight shipments on the smaller side, LTL is usually the best option. As thename indicates, these items do not take up an entire trailer, so you pay less bysharing space with other business’s shipments. While cheaper, it’sslower due to additional stops, unloading and loading. This also increases therisk of damage. Generally speaking, LTL is a good option for shipments rangingfrom 150 to 15,000 pounds.
Full truckload:
Bigger bulk shipments require a full truckload and usually weigh more than 15,000pounds. Your goods will travel faster with full truckload because it’s notmaking extra stops or taking a circuitous route to reach the final destination.This also means your products are less likely to be damaged.
Partial truckload:
Though the concept of partial truckload is similar to LTL, it’s slightlydifferent. Partial truckload shipping also splits space with other shippers, butshipment sizes are usually larger than LTL (more than 5,000 pounds). This meansonly a few companies share the truck, reducing stops and additional handling.
Sea transport:
The modes above all refer to transportation by truck, but ships are anothercritical mode of freight shipping. This is actually the most popular shippingmethod globally due to its low price and ability to cover long routes acrosscontinents. At least 80% of all goods shipped globally travel by sea at somepoint.
Air freight:
Planes are the fastest and often the most direct option to get products frompoint A to point B. However, for the same reasons this is the most expensivemethod, so companies often reserve air freight for rush orders or smallershipments that aren’t as pricey.
Rail freight:
Another cost-effective way to move freight cargo, trains are a popular shippingoption if you’re not on a tight timeline. Trains may take goods to or fromports to get them closer to the final destination before they’re loadedonto a truck for last-mile delivery. This mode of transportation can efficientlymove large and heavy shipments.
Intermodal:
Any shipment that uses multiple methods of freight transportation is intermodal,so this could be any combination of ground, air and sea. Often, the cheapest wayto move packages requires multiple modes of transportation, though it will alsotake longer.
Expedited:
This mode is pretty self-explanatory — when you’re on a tighttimeline, expedited freight shipping ensures your items will get there quickly.Planes and trucks are both common options for expedited shipments, andyou’ll pay a premium for the speed.
Benefits of Freight Shipping
There’s a reason why freight shipping is one of the most common ways shipments aremoved around the globe — it simply makes sense for moving many types of large orders.Here are a few of the key benefits of freight shipping that demonstrate why it’sso common:
Economical:
Freight shipping is a cost-effective way to transport large quantities of goodsfrom one place to another, especially if you use ships or trains. This isespecially true with LTL, which greatly reduces the price of transportingproducts by truck. Lower costs are especially important in a time of skyrocketingshipping costs.
Range and quantity of items:
Freight shipping can accommodate loads that include many pallets and the heaviestand most awkwardly shaped packages. Few other methods can match the wide rangeof goods that freight can handle.
Eco-friendly:
The ability to consolidate shipments for multiple companies on ships, rail carsand trucks makes the most of each trip and prevents additionalemissions-generating journeys. This is an increasingly important issue asconsumers pay more attention to the environmental impact of the companies theybuy from.
Variety of options:
Not only can freight shipping handle all types of goods, but it also givesbusinesses plenty of options for different speeds, costs and shipment sizes.This broad selection allows shippers to choose the option that best suits theirneeds for any given transport.
Consistency:
Although recent supply chain snafus have affected all shipping methods, freightis generally a reliable way to move products and ensure shipments arrive by thepromised date, increasingon-time delivery and other distribution KPIs. Even LTL shipments oftenfollow a regular schedule because carriers will group regular customers from thesame area together and follow a consistent timeline.
Factors That Determine Freight Shipping Rates
If a company is unsure whether they should ship goods via freight or parcel, they can useonline estimator tools from different carriers to get a sense of the cost. Generallyspeaking, the amount of total shipping capacity consumed by your shipment is a primaryfactor in overall price.
Below are a number of the variables that will impact the price of shipments:
Distance.
An obvious one, but the total distance your package needs to travel will affectthe price. A Trans-Pacific trip will be more expensive than a train moving yourgoods to another city that’s 300 miles away.
Timing.
High-priority rush shipments will always cost more than those that move slower.The more lenient you are on the delivery date, the cheaper it will be.
Mode of transport.
As noted earlier, freight covers transportation by truck, rail, sea and air. Themode of transportation will have a big impact on the price. Ocean freight isusually the cheapest option, followed by rail, truck and air.
Weight.
There’s a big difference between moving a 200-pound item and a 3,000-poundcollection of pallets, and prices will reflect that. The greater the weight of ashipment, the harder it is to move and the less capacity there is for othergoods, increasing costs.
Size.
Will your box take up a small corner of the truck bed or a quarter of allavailable space? How tall is your pallet of goods? As you would guess, thelarger your items, the more you’ll pay.
Location.
The pickup point for your shipment affects rates in a few different ways. Howclose is it to the carrier’s nearest location? Is it close to pickup spotsfor other businesses that may join your journey? These can all factor into theprice.
Time of year.
Weather can be a major issue when moving goods, whether it’s unfriendlyseas or highway closures due to snowy roads. These issues tend to strike more atcertain times of year, which will affect how much you pay.
Density/stowability.
How well do your items pack down? Do the dimensions suit a shipping container ortruck trailer and leave space for other products? This affects the amountshippers can fit in a total load and therefore is a factor in price.
When to Consider Multi-Weight Instead of Freight
Multi-weight compares the price of breaking up a shipment into multiple packages —perhaps sending all or some by parcel — and consolidating everything into oneshipment.It’s a useful tool when you have multiple boxes or pallets all departing from thesame location and heading to the same destination. Some tools will automatically choosethe cheaper option after you plug in details about your packages.
Multi-weight can reduce landed costs for yourshipments by helping you pick the best option. It also eliminates the time it would taketo manually calculate the expense of these different options. There are minimum andmaximum total weights and dimensions per package and for the total shipment, so not allshipments are eligible for multi-weight.
If freight and multi-weight offer similar prices for your shipment, there are a few otherfactors to consider. Multi-weight shipments don’t need to be palletized or packedin a special area of our facility. This also means the pallet itself won’t counttoward your shipment weight, and the drop-off point doesn’t need the docks orlift-gates required for pallets. Multiple boxes also make for easier delivery in bigcities that are hard for large box or semi-trucks to navigate.
How to Ship Freight
If you’ve determined freight is the best way to ship your goods, you’re nowtrying to figure out how to prepare your items. Let’s walk through the steps youshould take to get your goods ready for a freight carrier.
- Prepare any documents required for the shipment, including those that the carrierwill need to review.
- Choose a pallet, box or crate that’s the right size for the shipment and hasno substantial damage.
- Check the items for any problems and replace them or, if it’s more minor, makenote of it. This helps you track any damage caused by the shipper.
- If using a pallet, stack the boxes or items vertically in a consistent pattern,making sure that nothing is hanging over the edges. In other situations, carefullyload everything into a box or crate. Use padding or other protective materials asnecessary.
- Create labels with the destination address and the contents of the pallet or box andattach them to the shipments. This could include barcodes or other uniqueidentifiers.
- Use straps, bands and shrink wrap to secure all the contents to the pallet or withina container.
- Move the packaged shipments to the appropriate area of the building where thecarrier will pick them up. Check all pallets and packages for complete and accuratelabels.
- Take pictures of each pallet or package to show their condition before the carriertakes possession of them. Again, this will come in handy if something goes wronglater.
Managing Freight and Commerce With Software
Many companies have recently doubled down on their investment in supply chain technologyas they recognize the tremendous value it can add to their organization. Supply chainsare a primary source of expenses for products businesses, so any efficiency gains inthis area can make a big difference. A big piece of that is supply chain software thatmanages the entire order-to-cash process.
When it comes to freight shipping, a solution like NetSuite Warehouse Management System (WMS) helps withpicking, packing, shipping labels and order staging. NetSuite WMS supports multi-orderpacking so you can prep multiple orders for shipping at once. You can also use thesystem to print custom carton and pallet labels as well as bills of lading so everythingcan be closely monitored. NetSuite also integrates with leading shipping software thatwill show all available shipping options based on package size and weight. This is whereyou can compare rates for the various types of parcel and freight shipping and theexpected delivery dates for each to always find the best option.
NetSuite WMS and InventoryManagement can also help with incoming freight shipments. Users can set upputaway rules in the inventory management system that direct putaway of new inventoryand automatically assign expiration dates to items where that’s necessary. The WMSalso integrates with barcode scanners for faster putaway and greater accuracy. Theinventory management system ensures a company actually has the inventory it’soffering available, and the WMS then guides workers through the pick, pack and shipprocess. Together, all of this functionality facilitates a positive customer experiencethat will keep customers coming back.
Shipping is complicated when you’re sending out hundreds or even thousands oforders per day, and you need the right tools to effectively manage this piece of yourbusiness.
The majority of products you use every day, whether a bar of soap, laptop or diningtable, were likely part of a freight shipment at some point in their long journey toyou. It’s a critical method for transporting goods around the globe, if largelyinvisible to most of us.
Any businesses that deals in bulk shipments — sending or receiving — should haveat leasta basic understanding of freight shipping because it’s a key piece of their supplychain. Not only can it reduce transportation costs, but it’s sometimes the onlyoption for moving heavy or large items. Understanding what goes into the pricecalculation for freight shipments and having access to the right tools will helpcompanies take full advantage of freight shipping.
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Freight Shipping FAQs
What can be shipped via freight?
Almost any item can be shipped via freight, as long as it is not hazardous (likeexplosive products), perishable (like produce) or especially valuable (like rare gems).Even in those cases, there are specialized carriers who will help you transport thegoods. However, shipments must meet minimum weight or size requirements to qualify forfreight shipping, which is why pallets with dozens or hundreds of smaller goods arecommon.
How do I know what type of freight solution my business needs?
The best freight solution to meet your needs will depend on your budget, shipment sizeand required delivery date. Less than truckload, or LTL, is a popular option for smallershipments because it’s much cheaper than paying for an entire truckload but can beslow. Intermodal freight shipping uses multiple modes of transportation, like air andtrain or sea and truck, and the methods you choose will dramatically impact the priceand delivery timeline. For a complete breakdown of different types of freight, see theFreight Shipping Modes section.
What’s the difference between parcel and freight?
Parcel is for smaller and lighter shipments, generally under 150 pounds and less than 108inches long or 160 inches in length plus girth (two times width plus height). Most ofthe items that arrive at your doorstep, from shoes to electronics to home improvementtools, arrive via parcel. Freight is primarily used by businesses to cost-effectivelymove large quantities of goods around the globe, including by sea, truck, rail and air.
What is freight classification?
Freight classification is a framework from the National Motor Freight Classification(NMFC) that helps determine the price of less than truckload (LTL) shipments. Freightclass is based on the density (weight relative to size), liability (based on value),handling requirements and stowability. There are 18 freight classes with numbers from 50to 500, and the higher the number, the more expensive the shipment.
