LCL stands for less than a container. It is a term used for cargo which is not large enough to fill a container and its weight is less than the capacity of the container. LCL should meet both criteria (weight and volume); a shipment small in size but have weight that is equal to container capacity is not an LCL cargo.
How LCL can be transported?
Many LCL shipments are combined to utilize the container as much as possible. This process of combining shipments is called consolidation. Consolidation generally does not utilize 100% of the container. This is because shape of some LCL shipment may not permit to fully pack the container.
How LCL can be billed?
LCL can be billed in unit of w/v. The total freight is calculated based upon the weight and volume. If a shipment occupies more space than 1 cbm (cubic metre) for 1000 kgs, it will be charged based on volume. While, if the shipment is denser than 1000kgs/cbm, it will be charged based on weight. Freight rates are always quoted in w/v where 1000kgs/cbm is the determining factor if it is to be charged based on weight or volume.
This can be more generalized. For example, goods like electronics, wooden furniture, cotton etc. are charged based on volume while denser goods like rice, wheat, engineering goods etc. are charged based on weight.
Most of the time, LCL does not utilize 100% of the container, moreover it requires extra efforts while loading and unloading. The freight per w/v is slightly higher for LCL as compared to FCL. It can be 10 to 40% higher based upon port and shipping line.
Advantages of LCL: LCL is freight always less as compared to full container. So it saves money especially for small traders.
Disadvantage of LCL: Consolidation may be required at several points (like at source, at port of loading, at destination port and near destination container depot). This increases time to ship as compared to Full container. In shipment where total volume of all the LCL boxes is smaller than 1 Cubic metre or 1000 Kgs, it is not recommended to use LCL as consolidator charges for 1000kgs/1CBM in this case.
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