The right shipping choices are pivotal to your operational efficiency, cost-effectiveness, and overall success when venturing into Amazon selling.
Amazon Freight presents three primary inbound shipping modes: Small Parcel (SP), Less Than Truckload (LTL), and Full Truckload (FTL). But which one suits your business needs the best depends on several factors.
In turn, your choice of shipping method influences several facets of your business from the ground up. Keep reading to uncover the nuances of each shipping option so you can determine the right option for your business.
The digital age has reshaped the way people shop. With just a few clicks, consumers can have products from around the globe delivered to their doorsteps.
But behind the scenes of this shopping revolution is a complex network of logistics that makes it all possible. The ever-increasing prominence of online shopping has also brought the heightened demand for efficient shipping systems.
From boutique startups to established giants, the eCommerce industry spans many products, services, and consumer needs. In 2021, over 2.14 billion people worldwide purchased goods and services online.
Online platforms allow businesses to extend their reach far beyond local or national confines, with shipping evolving from local deliveries to complex international logistics. Additionally, different products have unique shipping requirements, which adds layers of complexity to the process.
Giants like Amazon have revolutionized consumer expectations. Thanks to rapid delivery promises like Amazon Prime’s one-day or two-day shipping, the benchmarks for online shopping convenience have become more stringent.
Consumers are now accustomed to instant gratification, be it streaming a movie or downloading an eBook instantly. That desire for immediacy extends to their shopping habits, with many willing to pay a premium for faster delivery — and that’s the start of their expectations. They also demand transparency. The ability to track their orders in real time, with accurate estimations on delivery dates, has become standard.
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Each shipping mode, be it SP, LTL, or FTL, serves a distinct purpose and caters to various volumes and types of shipments.
For sellers who operate in niche markets with limited inventory or smaller items, SP may be the perfect solution.
The primary allure is its impressive turnaround time. Think of SP as the express service of Amazon Freight: You’re guaranteed quick receiving, sorting, and delivery times, ensuring your products reach the Amazon fulfillment centers at lightning speed.
With SP, there’s minimal room for disruptions. Each parcel receives individual tracking, which reduces the likelihood of misplacement. It’s akin to sending several express mail packages, each with its own trajectory and timeline.
On the surface, LTL is a logical choice for businesses that operate on a slightly larger scale but not large enough to warrant an entire truck.
LTL is inherently riskier though. With multiple sellers’ goods packed into one truck, the logistical challenges multiply. One delay can set off a chain reaction, jeopardizing the timely delivery of all products in that truck.
Imagine a carrier in charge of delivering your products is suspended due to late deliveries. This is bad news for both the carrier and you: Your inventory is stranded, waiting for bureaucratic red tape to clear or alternative shipping arrangements. It’s not just a delay — it’s a potential business setback.
Tip: Working with a large scale FBA prep facility can provide the flexibility and volume benefits of LTL with the speed and security of FTL by combining multiple customers within the same facility onto a dedicated truck. MyFBAPrep is able to do this in instances where a single customer doesn’t make sense for a full truck, but combined together they compromise multiple truckloads each week.
FTL is for the heavy hitters — the businesses that operate on a grand scale. This option could be right if you regularly ship vast quantities of products.
FTL gives you unparalleled control over your shipment. The entire truck is dedicated to your inventory, ensuring the focus remains on delivering your items on time.
Initially, FTL might seem like a significant investment. But the cost per item shipped can be surprisingly economical for substantial shipments. It’s bulk shopping — the more you ship, the more you save.
LTL is often seen as the middle ground, balancing the scale between SP and FTL. But with that come compromises, and in the case of LTL, they can be challenging.
When carriers handle LTL shipments, they juggle deliveries for multiple sellers. This multitasking increases the margin for error. A delay in one delivery or a missed appointment can lead to cascading delays for all shipments on that truck.
Service providers often have to mitigate these disruptions by orchestrating either the return of goods or finding an alternative shipping method. Both scenarios are resource intensive and can also be detrimental to your business’s reputation and efficiency.
The risks associated with LTL don’t stop at potential delays or disruptions either; there are other moving pieces to deal with, such as:
The intricacies of LTL can be daunting, while FTL and SP emerge as the shining stars in this lineup. We’ve summarized why these two modes could be the best picks for your business.
eCommerce is dynamic, and with platforms like Amazon, the pace is dizzying. Your shipping choices can significantly influence your business trajectory.
While LTL blends SP’s nimbleness with FTL’s volume, it brings some noteworthy challenges. On the flip side, with their distinct advantages, FTL and SP offer a more streamlined and efficient shipping experience.
As you chart your entrepreneurial path in the Amazon marketplace, it’s essential to prioritize efficiency, speed, and reliability. After all, a timely delivered product can mean the difference between a satisfied customer and a lost sale.