Whether you’re shipping a bundle of parcel packages in one large shipment, or you’re looking for a cost-effective way to move large products over a long distance, understanding the language used by shipping professionals is a must-have skill when negotiating contracts. While much of the shipping industry is not standardized, the terms “freight” and “shipping” are fairly straightforward and consistent across the board.
What is the Difference Between Freight and Shipping?
At their simplest, freight and shipping refer to two parts of the goods transport process.
- Freight or “cargo” refers to large shipments of goods transported by water, land, or air. There are several classifications of freight shipments including Less than Truckload (LTL) and Full Truckload (FTL).
- Shipping generally refers to the transport of goods by water, land, or air. This can be either commercial or non-commercial shipments and can include freight shipments and parcel shipments. This simply refers to the process of moving product from Point A to Point B using a transport or shipping company.
Freight vs. Shipping Your Product
When you want to understand the difference between freight and shipping, what you’re really asking is whether you ought to use freight shipping or parcel shipping for your products. Here are a few benefits and challenges to each method:
Freight Shipping
Using this method, the shipper has the option to bundle together multiple shipments for a long haul, and break the shipment down at a warehousing facility for multiple consignees. This is both a cost and environmentally-efficient method of shipping. Freight is classified and priced by many factors including weight, size, transport method, and route.
Freight shipping often offers significant cost savings to both the shipper and consignee. If a shipper is transporting goods within local proximity of a major metropolitan area, rail may be an efficient and affordable transport method. If the shipper wants to store the product until a big sale, a third-party logistics provider can assist in finding the right warehouse and freight shipping carrier to make that happen in an affordable manner.
Parcel Shipping
Using this method, the shipper is usually either a small retailer or a private citizen. Parcel shipping is not often used for long-haul commercial shipping because it is both inefficient and expensive. Parcel shipping is usually classified and priced by several factors including, parcel value, weight, size, transport method, and guaranteed delivery date.
Parcel shipping is a convenient option because you can send the product directly from Point A to Point B without the warehousing in between. But that convenience comes at a steep cost. It is significantly more expensive to use parcel shipping (even with a bulk rate) than freight shipping for commercial purposes.
Navigating Freight vs. Shipping
If you’re not sure whether freight shipping or bulk parcel shipping is the right option for your business, let the expert logistics professionals at Amware price it out for you. We’ll show you how the two compare and even give you figures from several different carriers so you can see the real cost-savings of freight shipping. Want to learn more? Contact us now, or download a free 30-day trial of our industry-leading LTL software, Amrate.
