How to Leverage Consolidated Freight Shipping: A ShipBob Guide

Let’s say you’re a mid-sized company managing shipments from a dozen different suppliers. Managing each shipment individually can lead to overwhelming shipping costs, a complex supply chain, and a confusing overlap of delivery schedules.

But how can you streamline this chaos while improving profitability? 

The answer is with consolidated freight. By combining shipments into a single, larger load, you simplify logistics, cut down on handling, and save big on shipping. In this article, we’ll break down how consolidated freight works, why you should consider using it, and how ShipBob’s solutions make it easy to implement.

What is consolidated freight shipping?

Consolidated freight shipping involves merging multiple shipments into a single larger load. Instead of shipping products individually, consolidated freight collects shipments from different sources, organizes them into one larger, more manageable load, and transports them together. 

For businesses that handle frequent shipments, order consolidation is a powerful way to cut down on repetitive shipping expenses, reduce handling time, and optimize warehouse workflows. This strategy also minimizes the number of trips needed, which reduces environmental impact and helps companies align with sustainability goals.

How consolidated freight shipping works

The consolidated freight process involves a few key steps to ensure smooth delivery. At a high level, individual shipments are sent to a consolidation center, combined, and sent off to their final destination as one larger shipment.

Here is a little more detail on how each step works:

1. Collection of individual shipments: Shipments are picked up from various origins—suppliers, warehouses, or locations—and scheduled for transport to a central hub. This stage is often coordinated by a third-party logistics provider (3PL) to handle routing and pickup logistics.
2. Delivery to a consolidation hub: The collected shipments are sent to a centralized hub where they are sorted and prepared for consolidation. This hub organizes items to maximize space and minimize costs.
3. Combining shipments: At the hub, the shipments are grouped into a single load, which can include orders from different companies. This consolidated load fills trucks or containers more efficiently, reducing the number of trips and costs.
4. Transport to the destination: The fully loaded truck or container is dispatched to the designated destination.
5. Deconsolidation and final delivery: Upon arrival, the consolidated shipment is deconsolidated at the destination hub, with individual shipments separated for delivery to final destinations or distribution points.

Key benefits of consolidated freight shipping

The practice of consolidating freight comes with a lot of perks, especially for businesses juggling multiple shipping locations or trying to keep costs in check. Here’s how consolidated freight shipping can make a difference, whether you’re running an ecommerce business or a brick-and-mortar store.

Cost savings

Consolidated freight is a huge cost-saver. By grouping smaller shipments into one load, you can take advantage of full truckload (FTL) pricing. This is great for larger companies that are working with multiple suppliers, are able to fill a truckload themselves, and want to avoid the high costs of multiple less-than-truckload (LTL) shipments.

However, small and medium-sized businesses (SMBs) can also take advantage of these savings by collaborating with other companies to share a truckload. This way, they get the benefit of FTL pricing without needing enough volume to fill an entire truck themselves.

Reduced risk of damage

For LTL shipments, chances are items will come off the truck multiple times as they’re transferred between different hubs or sorted along the route. With each transfer, the risk of damage or loss increases.

With consolidated freight, shipments are handled less frequently since they’re combined into one larger load. This means items stay on the truck for the majority of the journey, lowering the chance of damage.

Improved logistics efficiency

Consolidated freight makes logistics simpler by merging multiple shipments into one. This reduces the hassle of tracking and scheduling individual shipments. Plus, with tools like ShipBob’s warehouse management system (WMS), businesses can streamline warehouse operations and keep things running smoothly from start to finish.

Environmental benefits

Consolidated freight shipping is also a more eco-friendly option, supporting green logistics initiatives. Fewer trips mean less fuel consumption and fewer emissions, making it a great choice for businesses with sustainability goals looking to lower their carbon footprint.

Types of freight consolidation

There are a few different ways to consolidate freight. We briefly touched on LTL and FTL above; however, there are other methods that may offer even more flexibility depending on the type of goods, shipping distances, and specific cost-saving goals.

Let’s discuss the ins and outs of each freight consolidation type.

LTL (less than truckload) consolidation

LTL consolidation combines smaller shipments from multiple shippers into one truckload, making it a great solution for businesses that do not have enough goods to fill an entire truck. LTL freight is ideal for companies that need reliable, cost-effective solutions for moderate-sized shipments.

FTL (full truckload) consolidation

Full truckload (FTL) consolidation combines multiple shipments to fill an entire truck, making it ideal for businesses with large quantities of goods. This approach allows for faster delivery times and minimizes handling since the truck travels straight from origin to destination without any stops in between.

Container consolidation

For international shipping, container consolidation groups multiple less-than-container loads  (LCL) into a single container for sea or air transport. It’s commonly used for shipping heavy items or products with specific regulations. Businesses that use container consolidation reduce cross-border shipping costs, especially in markets where customs processes are strict and fees are high. Additionally, this type of consolidation reduces the handling of freight, resulting in less damage or potential theft.

Hub and spoke consolidation

In the hub and spoke model, shipments from various origins are sent to a central hub where they’re consolidated and sent to their final destinations. This model is particularly efficient for companies with multiple warehouses or retail locations and helps save on long-distance ecommerce shipping by optimizing routes through a central hub.

Multi-vendor consolidation

With multi-vendor consolidation, companies can combine shipments from different suppliers into a single load. This method streamlines logistics and reduces inbound shipping costs for businesses managing inventory from multiple sources, which is especially useful in retail. Multi-vendor consolidation enables businesses to receive goods faster and organize stock with minimal expense.

Challenges and considerations of consolidated freight shipping

While consolidated freight shipping is beneficial, it comes with certain considerations.

Managing multiple shipments

Coordinating multiple shipments can get complicated fast, especially with different suppliers, shipment types, and destinations in the mix. Each shipment has its own timeline, tracking needs, and paperwork, so staying on top of it all takes some serious planning.

Not to mention, after receiving all shipments at a central hub, you’ll need to combine them into one large load, keep an eye on its progress, and then separate everything again once it arrives at its final destination.

Finding reliable carriers

Finding reliable carriers can be challenging, but it’s crucial for consolidated shipping to work well. Without a dependable carrier, you risk delayed shipments, lost items, or damaged goods, which can throw a wrench in your entire logistics plan. 

ShipBob’s solutions for consolidated freight shipping

As a trusted logistics partner, ShipBob offers solutions that make consolidated freight easy, affordable, and scalable. By partnering with a reliable 3PL like ShipBob, businesses can gain access to the resources and networks needed for effective freight consolidation and flexible solutions for ecommerce fulfillment.

Lightning-fast freight delivery with ShipBob’s 2-Day Express shipping

Cut freight consolidation costs with our Inventory Placement Program

Our Inventory Placement Program (IPP) helps distribute inventory across ShipBob’s network of fulfillment centers, cutting down on both transit times and shipping expenses. By strategically positioning products, ShipBob enables businesses to lower costs, improve delivery speed, and streamline their operations.

Streamline your consolidated freight with ShipBob’s WMS

ShipBob’s WMS takes the hassle out of handling and consolidating freight. By optimizing warehouse operations, ShipBob’s WMS keeps everything running smoothly—tracking inventory, managing orders, and coordinating shipments to ensure freight is handled efficiently. With fewer manual steps and automated processes, the WMS reduces errors and makes consolidation faster.

Distribute your freight with a global fulfillment network

How ShipBob has helped brands like yours

Leveraging consolidated freight is just one way ShipBob supports brands in streamlining logistics and reducing costs. By combining efficient freight solutions with tools like our WMS and inventory placement program, ShipBob helps businesses scale, meet customer demand, and reach new markets.

Semaine Health

Semaine Health, saw big improvements using ShipBob’s IPP. By distributing inventory across four ShipBob fulfillment centers in the U.S., Semaine Health cut shipping times by a third—from 5.2 days to about 3.6 days—and reduced fulfillment costs by over $2 per order compared to their previous 3PL.

Pit Viper

Pit Viper expanded globally and improved cost-efficiency by leveraging ShipBob’s international network. With fulfillment centers in the U.S., Australia, and Canada, Pit Viper uses ShipBob’s centralized system to streamline international orders, getting products to customers in days instead of weeks.

Beachwaver

Beachwaver enhanced its fulfillment capabilities by partnering with ShipBob for a flexible, hybrid solution. To reach customers overseas, Beachwaver outsourced its international fulfillment to ShipBob. Then, to keep up with domestic demand, they implemented ShipBob’s WMS within their own facility and expanded by tapping into ShipBob’s U.S. fulfillment network.

Get started with ShipBob

Ready to leverage ShipBob’s best-in-class supply chain and fulfillment solution? Connect with our team of fulfillment experts to get started.

Consolidated freight FAQs

Here are answers to commonly asked questions about consolidated freight.