FCL vs LCL Shipping: Differences Between & How to Choose

If you're considering shipping any amount of cargo by sea, you'll soon find yourself wondering which makes the most sense between LCL (less than container load) and FCL (full container load) shipping. 

But there are many things to consider and understand before making a decision. If you're trying to decide which container shipping option to use, check out this guide for all the information you need to know.

We'll explain all about FCL and LCL shipping, their differences between & how to choose, and provide you with a convenient solution.

Here is the list of contents:

· FCL vs LCL: Definition

· Difference Between FCL and LCL

· LCL Shipments Cost More Than FCL Shipping

· Issues That Should Be Paid Attention to in Ocean LCL Shipping

· Customs Clearance for LCL Shipments is More Complicated and Takes Longer Than for FCL shipping

· LCL Customs Declaration FAQ Summary

FCL vs LCL: Definition

Less Than Container Load (LCL) refers to the consignment of the owner of the goods less than a full container, the agent (or carrier) will sort the goods, the goods to the same destination, assembled into the same container. As a box with different owners of the goods put together, so called consolidation.

 

LCL can be divided into direct LCL or transshipment LCL, direct LCL refers to the LCL container of goods in the same port loading and unloading, before the goods arrive at the destination port without unpacking, that is, the goods for the same discharge port. Short transportation period, convenient and fast. Transit LCL refers to the same container of goods are shipped separately to different ports, because the need to unload and unpack the container in the transit port, such as cargo transfer flights, so the timeframe will be relatively slow, in the time of LCL to pay attention to this point.

FCL is called full container load, FCL is just the opposite of LCL, only one consignor of the whole container goods to the destination port, so the whole transportation process is relatively easier than LCL. Full container cargo, the consignor is responsible for packing, counting, stowing and sealing the cargo. The unpacking of the whole container cargo after transportation to the destination port is usually handled by the consignee.

Difference Between FCL and LCL

FCL vs LCL: The Difference of Form

There are three forms of LCL:

1、One consignor corresponds to multiple consignees

2、Multiple consignors correspond to one consignee

3、Multiple consignees correspond to multiple consignees

 

FCL: one consignor corresponds to one consignee

As long as the appearance of the container and the receipt of similar and sealed intact, the carrier has completed the responsibility of carriage, so the whole container transport bill of lading, usually have to add "shipper packing points and seal" clause.

FCL vs LCL: The Difference of Process

LCL cargo: the carrier receives such goods, according to the nature and destination of the classification, the same destination, the same nature of the goods into the same container for transport.

 

Full container cargo: the consignor is responsible for packing, counting, filling out the shipping order, and the goods sealed by customs. Unpacking of full containers of goods generally handled by the consignee, can also be entrusted to the carrier in the freight station unpacking, but the carrier is not responsible for the loss of goods in the box, cargo, unless the cargo side to prove that the carrier is responsible for the damage, the carrier is responsible for compensation.

FCL vs LCL: The Difference Between Shipment and Customs Declaration

Shipment:

Because the container shipping transport is also a professional part of the foreign trade process. Most foreign trade companies will not be involved in this step, but directly entrusted to the special freight forwarding company for. Because the situation of freight forwarding companies are not the same, some only do direct spelling, some will do transshipment. So we must ask clearly when communicating with the freight forwarding company.

 

General foreign trade shipping process, if it is the form of LCL, the goods directly transported to a designated warehouse, the freight forwarder to give us a unified arrangement to load a container can be. And the whole container is an additional step to lift the container, we need to lift the container to our factory loading, if the freight forwarding company does not provide us with customs clearance and towing services, we have to find their own good help in advance to do customs clearance and towing agent.

 

Customs Declaration:

Because the container is more than one cargo, as long as there is a mistake in the documents, customs will not release. It will affect the transportation time of other cargoes in the same container. Therefore, the customs clearance time for LCL is longer and more complicated than that for the whole container. In addition, customs clearance takes some time, usually one working day can be released. But in order to prevent accidents, it is best to load the goods into the container three or four days in advance, that is, loaded containers.

 

LCL cargo usually can not accept the designation of a specific shipping company, the shipping company only accepts the booking of the whole box of goods, but not directly accept the booking of LCL cargo, only through the freight forwarder (individual strong shipping company through its logistics company) will be the LCL cargo after the whole booking to the shipping company.

FCL vs LCL: The Difference of Transportation Cost

The transportation cost of LCL and full container also has a big difference, here the quotation of a freight forwarding company is used to illustrate.

FCL Shipments:

SHENZHEN-TEMA

· O/F: USD1175/Container

· THC: RMB1000/Container

· ISPS: USD12/Container

· SEAL: RMB50/Container

· DOC: RMB500/BL

· EIR: RMB50/Container

- Trailer fee: reimbursement on a reimbursement basis

- Insurance: One thousandth of the value of the goods (minimum consumption RMB100)

- Shipping time: 41DAYS

LCL Shipments:

SHENZHEN-ISTANBUL

· O/F: USD10/CBM

· CUS: RMB320/BL

· DOC: RMB300/BL

· CFS: RMB40/CBM

· ENS: USD25/BL

- Pickup: Reimbursement

- Insurance: One thousandth of the value of the goods (minimum consumption RMB100)

- Shipping time: 28DAYS

From this quotation, there is also a difference in the composition of the cost of full container and LCL. 

The whole container cost composition: sea freight, port charges, warehousing fees, internal loading fees, some goods and direct loading fees, reinforcement and other costs.

LCL generally includes three costs, ocean freight, LOCAL CHARGE, warehouse costs.

LOCAL cost is the destination port consignee to pay the agent, each port cost is different, each agent charge is different, so to confirm with the freight forwarding company in advance.

Because of the reduction of shipping company's procedures, some shipping associations will have freight discounts for full container shipments. As for LCL cargo, usually shipping associations charge certain container terminal service fee.

There are some shipping company's transport table, for the use of container volume of LCL cargo has a minimum, the load may not be lower than this limit, such as the number of loads below this minimum, the shipper must also pay for this minimum load (not used also need to pay), and usually charged at the highest freight rate for the goods in the container.

LCL Shipments Cost More Than FCL Shipping

In general, the cost of shipping a full container of goods by sea includes freight, transport surcharges and port charges. The freight and transport surcharges should be the same for LCLs and FCLs, the only difference being the cost of consolidating the goods at the port of shipment and unpacking them at the port of destination.

In theory, these two costs should not be very high, but, because the level of labour costs vary greatly between countries and regions around the world, and exporters know little or nothing about those specific differences, originally the LCL goods than the whole container of miscellaneous transport costs, on the basis of the overall consistency plus a certain proportion of the LCL, unpacking fees and storage costs is very reasonable, but carriers in order to earn higher profits However, in order to earn higher profits, carriers often use the means of "fuzzology" and do not specify in their quotations what items are charged, but only generally how much is charged for each freight ton for each type of commodity transported to the port of destination, and the port charges are even more casual, and say how much is how much, the carrier has no obligation to explain, and the shipper has no room for bargaining. The carrier has no obligation to explain and the shipper has no room for bargaining, and the amount charged depends on the specific circumstances.

In addition, it should also be seen that import and export commodity trade, the greater the number and total value of each transaction, the lower the transaction costs, and conversely, the smaller the number and total value, the higher the transaction costs.

Compared to full containers, the quantity and total value of LCL goods are generally smaller, therefore, from this point of view to account for, the transaction cost of LCL goods is definitely higher than that of full containers. This is because the cost and postage of the transaction samples, communication costs such as fax and telephone, notification fees for letters of credit, customs declaration fees for import and export goods, and certificate of origin fees are charged by the number of copies rather than the size of the business. When these business costs are eventually apportioned to the cost of the transaction, the share of the cost per unit is smaller for larger transactions and larger for smaller transactions, and we should have a good idea of this.

Issues That Should Be Paid Attention to in Ocean LCL Shipping

1. LCL cargo generally cannot accept the designation of a specific shipping company. The shipping company only accepts bookings for FCL cargo, but does not directly accept bookings for LCL cargo. Only through freight forwarders (individual strong shipping companies pass their logistics companies) The LCL cargo can only be booked with the shipping company after consolidating the LCL cargo. Almost all the LCL cargo is transported through the “centralized consignment and centralized distribution” of the freight forwarding company. The LCL distribution port in East China is basically Shanghai. port. Due to the limitation of the supply of goods, the general freight forwarders can only book space with a few shipping companies, which can rarely meet the needs of the designated shipping companies. Therefore, when transacting LCL cargo, try not to accept the designated shipping companies, so as to avoid consignment processing. cannot meet the requirements.

2. When negotiating a deal with the customer, special attention should be paid to the relevant transport terms, so as to avoid the other party's letter of credit issued after the consignment is found to be unable to meet the terms of transport. Daily operation we often encounter L/C provisions of LCL cargo transport does not accept the freight forwarder's bill of lading, because the shipping company does not directly accept the booking of LCL cargo, the shipping company's ocean bill of lading is issued to the freight forwarder, and then issued by the freight forwarder HOUSEB/L to the consignor, if L/C provisions do not accept the freight forwarder B / L, then the actual transport for no choice of space, it will cause L / C does not match. Another example, we found a consignment note when handling transport: Goods must be shipped in container on LCL basis and Bill of Lading to evidence the same and to show that all LCL. handling charges, From the above paragraph of the original L/C, it can be seen that the consignee has passed on all the costs that should have been borne by him to the consignor, which was caused by the fact that the consignor and the customer did not negotiate in detail on the terms of carriage during the trade negotiations.

3. The billing tonnage for LCL cargoes should be as accurate as possible. Before delivery of LCL goods, the factory should be required to measure the weight and size of the goods to be as accurate as possible, delivery to the warehouse designated by the freight forwarder for storage, the warehouse will generally re-measurement, and will be re-measured size and weight as the charge. If the factory changes the packaging, you should ask the factory to notify in time, do not wait for the goods to be delivered to the freight forwarder's warehouse, through the freight forwarder to feedback information back, often time is already very tight, and then change the customs declaration documents, it is easy to delay customs clearance, or produce expedited customs clearance fees and punching fees, etc.

4. Some ports due to the lack of LCL cargo sources, high cost reasons, specializing in LCL freight forwarding companies to take the minimum charge for the cargo volume of less, such as the minimum starting at 2 freight tons, that is, less than 2 freight tons, all according to 2 freight tons billing charges. Therefore, the cargo volume is smaller, the port is more remote cargo in the transaction to take into account some of these factors, so as to avoid future passivity.

5. For some routes and ports are more remote, and the customer proposed to deliver to the inland point of the LCL cargo, the best deal before signing the first consultation, to confirm that there are shipping companies and freight forwarding companies can undertake to handle these remote ports, inland point of delivery and related costs before signing.

Customs Clearance for LCL Shipments is More Complicated and Takes Longer Than for FCL shipping

For one thing, the whole container of goods is in line with the minimum unit of customs inspection, sealing and release in the exporting and importing countries, and a batch of goods, as long as the exporters and importers submit reasonable and legal documents and are complete, the exporting and importing customs will soon be cleared and released after completing the relevant procedures and collecting the relevant taxes and fees. This is not as easy and quick as for LCL cargo. As long as there is a mistake in the documentation of the goods in the container, the export customs will not release the goods. This is because the export customs must seal the container before allowing the container to leave the country. Therefore, the same container, any one of the goods do not clear customs, is bound to affect the timely export and transport of other goods.

Secondly, the LCL cargo is far less than the whole container of cargo sources and flexibility, it needs the transport company extra solicitation and reasonable with some port of shipment, destination port, delivery period, the variety of goods, volume, weight and other aspects of the conditions are very suitable with the same container into the export of goods. These requirements are very difficult to do and take a long time. If the shipper consignment of the transport company is not strong in business, then the time of cargo transportation will be delayed even longer.

Third, in general, the whole container of goods can be shipped directly in the mainland ports, while the LCL goods are only suitable for delivery in developed coastal ports because of the relatively small number of mainland sources and the relatively large number of coastal sources. This will undoubtedly add a lot of extra trouble to the exporter. According to the relevant provisions of our government, export goods must be inspected by the Commodity Inspection Bureau in the place where they are produced and where they are exported for customs clearance. If the goods in the production location of the province (autonomous regions, municipalities directly under the Central Government) within the jurisdiction of the local customs declaration exports, a batch of goods only need to handle a commercial inspection can be. Otherwise, such as foreign customs declaration, a batch of statutory inspection of export commodities, must go through two inspections before the Customs will be released.

LCL Customs Declaration FAQ Summary

The same foreign customers in different suppliers in China to buy goods and then put together a cabinet together to foreign customers, sometimes two or three together, sometimes seven or eight together, such a situation is generally a container customs clearance, to talk about the common problems in the container customs clearance.

1. Customs declaration - agents and buy single customs declaration

Because the customer is in 3,4 different factories to purchase, some foreign customers in order to cheap, looking for some factories without import and export rights to purchase, although the price is cheap, but no customs declaration documents, need to buy a single customs declaration. So this time there will be suppliers inside some agents to declare, some need to buy a single customs declaration, especially the need for commodity inspection of goods to buy a single customs declaration. So this time it is recommended that goods with documents and goods with documents are put together in one container, and goods with buy orders for customs clearance and buy orders for customs clearance are put together. Try not to appear AB single, part of the agent customs clearance, part of the buy single, that is, a cabinet inside both the agent customs clearance of goods, and the need to do commodity inspection and can not do commodity inspection and must buy single customs clearance of goods, because most ports do not support AB single, the Pearl River Delta few such as Huangpu, Yantian, Shekou support AB single.

2. Destination country

Some of the suppliers inside the container to agent customs clearance is to refund the tax, some are not to refund the general trade of small write-offs, some are to commodity inspection of the customs clearance list, this time must pay attention to the different suppliers of customs information must be consistent with the country of destination.

There are often two situations, 1, the information to be refunded to do more detailed, write the real country of destination, not refundable small write-offs of the country of destination randomly played. 2, to Russia and some other inland points, the port of discharge is Poland, the railway transit to Russia, this time some people inside the customs declaration information destination country some is written Poland, some is written Russia. This leads to inconsistencies in the country of destination. This time, all write the country of destination Russia, Poland is only the port of discharge, not the final port of destination.

3. Value of goods

In the case of consolidation, the value of goods is not the same, for example, there are three companies, A USD4W, B USD4W and C USD3W, and the value of goods does not exceed 10W, so each of them does not need export invoices. Sometimes VAT invoices may not be sent by post and re-mailing delays customs clearance.

The value of the goods is not the same in the case of consolidation, e.g. a total of 3 factories A USD 14W, B USD 4W C, USD 3W

The total value of goods exceeds USD 10W, as A exceeds 10W, A has to provide export invoices, while others only need to provide VAT invoices.

4. Quantity of LCL

Generally speaking, the number of consolidation of a container will not exceed 8, individual places are 4, if a supplier in more than a dozen factories have purchase, just a dozen factories have customs information, this time we have to dozen customs information together with the consolidation of customs, generally speaking the customs support up to 8.

5. The difference between tax refund and non-refund

Three suppliers, two to be refunded, one not to be refunded, the total value of goods more than 10W, before may only need two refunded factories to provide VAT invoices and export invoices, now on the basis of the original also need not refunded factories to provide special export invoices.

6. The problem of sealing the door

As there are more goods to prevent confusion when declaring the checklist, it is best to remember what goods are loaded at the door of the container.

7. Combine several cabinets

Sometimes the supplier has more goods and may have to load 2 cabinets.

A, this time we should pay attention to the same family of goods loaded in a container, not A container loaded with a few squares, B loaded with a few squares. If the load is not enough to separate the two containers, customs clearance information to make a copy.

B, commodity inspection to correspond, for example, ABC three, A family has 70 cubic meters, B family 18 square, C family 8 cubic meters. Large cabinet cabinet has A family 50 cubic meters, B family 18 cubic meters, small cabinet loaded A family 20 cubic meters, C family 8 cubic meters. When doing the commodity inspection, A has to do two copies of the commodity inspection.

C, even the container to declare or separate. When declaring a container together, one was inspected and one was not, because it was a container together, both containers could not be on board. Separate reporting, the inspection continues to check and wait for the next water, the release can be on board.