Groupage Shipping refers to the technique of transporting a large quantity of cargo. It is when one bundles all the cargo to form a combined unit for ease of transportation. It involves the amalgamation of several smaller shipments as they are put in a single container.
Malcolm McLean invented the first-ever maritime shipping container. The task of shipping cargo to any location all over the world reformed the entire world trade. Thus, allowing the transport of goods by rail, road, or sea much more efficiently. This technological advancement has changed the way people shipped and become deeply advantageous for the shipping container industry.
You can ship goods in two different ways – FCL or LCL (Full Container Load or Less than a Container Load). One can notice that while transporting different cargo to the same destination, one has to adopt certain measures. In addition, when cargo is not enough to fill an entire load, you can easily group them with other shipments. This is known as Groupage Shipping aka LCL.
Uses of Groupage Shipping
Groupage shipping is useful in the transportation of combined smaller shipments. To complete the capacity of the container, one can amalgamate smaller packages. The cargo can be claimed by the importer once it has arrived and unloaded. It is often referred to as freight consolidation. As it is a very cheap and efficient way to transport goods, it boosts productivity in sending cargo.
In the situation of transporting cargo, groupage creates the goods of several clients in one single truck or container. Certain companies have to transport their cargo in a small number. They do this to maintain stocks of goods for the supply chains of their distributors. This is when groupage shipping comes into helping. It has proven to be a good option for companies that want to make a large number of shipping container sales. The size and weight of the cargo determine the price of groupage shipping. A dedicated system takes the measurements and determines the cost by the cubic meter.
Groupage shipping is becoming increasingly preferred to facilitate International trade in today’s time. So, to figure out which type of shipping is best as per your needs, you need to first learn what the quantity of your cargo is. And the final destination of your cargo as well.
So, in a nutshell, if you have goods that do not fill a full container, groupage could be the answer to all your problems.
What are the characteristics of Groupage Shipping?
One can use Groupage shipping in the given scenarios:
- The quantity of cargo is not sufficient to fill the capacity of a whole truck or container.
- Since groupage delivery takes a long time during the transportation due to a large number of deliveries in one single shipment. It is adequate to prefer groupage when dispatch deadline is not a key condition.
- During the transfer of the cargo to different countries.
- While pooling the cargo into one or several pallets
The main characteristics of groupage shipping are:
- Comparatively smaller freight weight
- Easy delivery of wide diversity of cargo of different shapes and packages
- A large number of carried senders and addresses
- Safe and flexible form of transportation
What are the advantages of Groupage Shipping?
There are certain benefits that one can avail of if they choose to transport their freight by this means. Some of them are:
1. Cost Savings
Grouping different shipments together makes it easier to share the shipping and storage costs. This way, companies that don’t have a lot of cargo on hand to transfer have the chance to pay only for the volume of goods that they require.
2. Better quality service
Groupage shipping opens a wide window of possibilities to the shippers by opening more routes. It increases flexibility in logistics operations as different companies send their cargo in a single freight container. It also helps in the reduction of waste of space by the optimum utilization of extra space available in the trucks and shipping containers as well as in the warehouses.
3. Reduced risk of damages
Cargo shipping is a risky business. Groupage shipping provides the opportunity for the loading and unloading of cargo repeatedly as it has to travel by one trip and thus has fewer destinations. As a result, the chance of the goods getting ruined or damaged diminishes at a huge rate.
4. Enhanced quality control
This type of transportation of cargo allows the receiving party to get their goods sooner. If there is some issue with the cargo, one usually has to wait till the container seller sends a replacement. And this mostly causes delays in shipment. In groupage, it gives a chance to perform quality control measures as the product reaches the warehouse, which reduces the loss of time and control due to unanticipated issues with the goods.
Drawbacks to Groupage Shipping
While everything has its fair share of benefits, it is evident that they come with certain downsides. Some disadvantages of groupage shipping are:
- There can be additional costs for the shippers if the cargo is not organized in a well-planned manner.
- It is more time-consuming as it involves multiple shipments and a complex process.
- There can be cases where securing a carrier for the cargo is difficult.
- There are not many container carriers who provide groupage shipping as it involves many parties.
For groupage shipping to be successful, it is necessary to coordinate your operations. The shipping company needs to have full control over its shipments and should have knowledge about the whereabouts of their cargo at all times. You need to make sure that you are able to purchase shipping containers from an online platform like BOXXPORT where you can easily buy used shipping containers, or even sell shipping containers. One must have full knowledge of how this type of transportation works to be able to ensure timely, hassle-free delivery.