Full Container Load (FCL) refers to a single container or multiple containers are booked by a shipper to transport their cargo exclusively under a bill of lading.(1)
Less than Container Load (LCL) refers to cargoes owned by different shippers, grouped in a single container by the forwarding agent, allowing transportation of smaller volumes of cargo without paying for a full container; this is more cost effective for smaller shipments which cannot utilize a full container.(2)
In real world not all containerized goods are transported either by LCL/LCL or FCL/FCL basis, but in mixed options as well such as LCL/FCL or FCL/LCL.
On this page, I am going to explain LCL/FCL shipments.
LCL/FCL is an international shipping term, that is used when multiple shippers dispatch goods under LCL terms for a single consignee.
A freight forwarder consolidates at least two different shippers’ cargo into a full container load at the export leg, but the cargo will not be deconsolidated at the import leg.
One importer clears all goods from the customs.
LCL/FCL Shipment Example:
An importer in Germany buys different foodstuff from Egypt. The importer works with couple of exporters in Egypt.
The German importer orders following goods from three Egyptian exporters as follow:
- Order 1: 6 Euro pallets of olives from exporter 1.
- Order 2: 8 Euro pallets of cheese from exporter 2.
- Order 3: 10 Euro pallets of canned peppers from exporter 3.
The goods are sold on FOB Alexandria Port, Egypt and shipment will be completed with a 40ft High Cube container.
40ft High Cube Container holds 24 Euro pallets.
Importer’s freight forwarder gets in touch with all exporters 2 weeks before shipment date and books the container.
As exporters locate relatively in close areas, it is decided that the goods will be loaded to the container at the exporters’ factories.
1 week before shipment date, the importer’s forwarder arranges inland transportation and brings the empty container from the port and sends to the exporters consecutively.
Inland transportation costs in Egypt up to Alexandria Port and Alexandria Port charges are paid by exporters proportionately according the FOB delivery term.
Although importer receives three sets of documents including three sets of bills of lading, the goods will not be deconsolidated and all goods inside the container will be collected by the same importer in Germany.
References:
- 1-2) LCL or FCL – Which Is Best For My Business?, Tuscor Lloyds,
