FCL and LCL
FCL (Full Container Load): The container is used by a single shipper. The cargo is loaded at the shipper's premises, the door is sealed, and the container reaches the consignee without being opened. The rate is fixed per container; you pay the same even if the container travels half empty.
LCL (Less than Container Load): Cargo from several shippers is combined in the same container by a consolidator. At origin it is loaded into the container at a CFS (container freight station) warehouse, and at destination it is separated again at a warehouse. The rate is based on the cargo's volume or weight.
| FCL | LCL | |
|---|---|---|
| Pricing | Per container | Per m³ or per tonne (W/M) |
| Transit time | Shorter | Longer, because of consolidation and deconsolidation |
| Risk of damage | Lower (the container is not opened) | Higher (the cargo is handled several times) |
| Suitable for | Enough cargo to fill a container | Small and medium volumes |
CBM: calculating volume
In sea and road freight, volume is measured in cubic metres (m³, CBM).
CBM = length × width × height (in metres) × number of packages
Example: 10 pallets of 120 × 80 × 150 cm → 1.2 × 0.8 × 1.5 × 10 = 14.4 m³
Chargeable weight
So that they do not lose money on light cargo that takes up a lot of space, carriers convert volume into weight and charge on whichever is greater: the actual weight or the volumetric weight. This is called chargeable weight. The conversion factor depends on the mode of transport:
- Sea LCL (W/M): 1 m³ = 1,000 kg. If the cargo is 3 m³ and 1,200 kg, it is charged on 3 "revenue tonnes".
- Air: Volumetric weight = (length × width × height in cm) ÷ 6,000. This means 1 m³ ≈ 167 kg. Express courier companies mostly use a factor of 5,000.
- Road groupage: In common practice 1 m³ = 333 kg. Charging can also be based on loading metres (LDM).
Worked examples
| Example shipment | Actual weight | Volume | Sea LCL (W/M) | Air (÷ 6,000) | Road (333 kg/m³) |
|---|---|---|---|---|---|
| 4 cartons, 60 × 40 × 40 cm | 48 kg | 0.384 m³ | 0.38 W/M | 64 kg | 128 kg |
| 10 pallets, 120 × 80 × 150 cm | 3,200 kg | 14.4 m³ | 14.4 W/M | 2,400 → 3,200 kg | 4,795 kg |
| 2 machine crates, 200 × 120 × 100 cm | 5,000 kg | 4.8 m³ | 5.0 W/M | 800 → 5,000 kg | 1,598 → 5,000 kg |
Where there is an arrow, the actual weight is greater than the volumetric weight, so the charge is based on the actual weight. Chargeable weight = the greater of actual weight and volumetric weight. In sea LCL most consolidators apply a minimum charge of 1 W/M; in practice the first example would be charged on 1 W/M.
FCL or LCL? The break-even point
As volume grows, the LCL cost rises in a straight line, while FCL stays fixed per container. Beyond a certain point FCL becomes cheaper, even if the container travels half empty. In the chart below you can change the prices to match your own quotation and see the break-even point.
Assumptions
Example assumptions (not real prices): LCL 60 USD/W/M + 150 USD fixed charges per shipment; 20' FCL 1,400 USD; 40' FCL 2,000 USD. On these assumptions a 20' FCL is cheaper than LCL from about 20.8 m³. Practical capacity is taken as 28 m³ for a 20' container and 58 m³ for a 40'.
The default values are examples, not real market prices. Freight rates change very quickly with the route, the season and market conditions. When deciding, take into account not only the freight but also CFS and deconsolidation charges in LCL, transit time and the risk of damage.
Test yourself
- A carton of 80 × 60 × 50 cm weighing 25 kg is going by air. What is the chargeable weight? (Answer: 80 × 60 × 50 ÷ 6,000 = 40 kg. Since 40 kg > 25 kg, it is charged on 40 kg.)
- In LCL, how many W/M is a 4.5 m³, 3,800 kg shipment charged on? (Answer: 4.5. The volume is greater than the weight in tonnes.)
- What is the drawback of LCL for fragile cargo with a high risk of damage? (Answer: It is handled several times during consolidation and deconsolidation.)