Two main concepts used in transportation for international commercial export and import are FCL and LCL. They are used in containerized transport, multimodal transport, which has been carried out for 45 years and is now used for transporting the main flow of goods worldwide.
Containers are transported by specialized container ships, which load and unload the containers at specialized ports, called container terminals, as well as by specialized trucks and specialized rail wagons for combining with sea transport.
FCL container transport
If a given exporter has enough goods to fill a whole container for transport, they choose FCL container transport. This type transport services is also called full container transport. Its advantage is that the cargo in the given container is owned by a single shipper. But the use of the FCL service can also be performed if the goods do not fill the entire container. The goods can fill, for example, half or a quarter of the container’s volume, but no goods from another shipper are added to it.
LCL container transport
With the LCL service, also called transport in groupage container, if a shipper does not have enough goods to fill a full container, they hire the container together with another shipper or shippers so that the container can be filled completely.
When to choose FCL and LCL container transport
The choice depends on the quantity of goods the shippers have. If a given shipper has enough goods, it is better for them to choose the FCL service, or full container transport. Thus only their goods will be transported in the container.
If, however, the shippers do not have enough quantity of goods to fill a full container, because they do not want to take the risk of shipping large quantities that, for example, may not be sold, they can share the costs with other shippers and use the LCL service, or group container transport.
Threshold of volume at which to choose between FCL and LCL transport
It is accepted that for a volume of goods under 14-15 cubic meters, which is half the capacity of a full 20-foot container, it is better to choose the groupage container service, or LCL.
Disadvantages of LCL transport, or transport in groupage containers
The main disadvantage of LCL transport is the need to wait until the container is fully filled. Delays can also occur in loading and unloading the goods for the individual shippers.
Another drawback is the risk due to blocking of a given item in the container by customs authorities and the other goods in this container may also be blocked.
For shippers who want the goods to reach a certain factory, for example, the drawback is that the container will not be delivered to that destination, as it is used for groupage transport of goods from different shippers. To transport such goods to a factory, for example, it is necessary to hire a vehicle, which is associated with additional costs.
The higher insurance costs for LCL transport should also be taken into account. Typically the difference in insurance premiums is about 3% for FCL transport, compared to 1.5% for LCL transport.
When transporting goods that can easily be crushed if they are placed in the container under other, heavier goods, they will be damaged during transport.