Co-loading is sharing space on a trailer or container and splitting the cost. Co-loading is often used for LTL loads or vehicles. For instance, one car trailer might haul ten cars, and those ten customers split the cost. Dedicated transport tends to cost more.
Other advantages include reduced time for Less than Truckload shipments and reduced receiving costs and inventory. Co-loading differs from LTL shipments in that it helps omit the hub and spoke network and ensures direct shipping to the clients or vendors. Co-loading also has minimal risks compared to LTL.
Various shipments are suitable for co-loading. Mainly, this affects shipments that require the same mode of handling. For instance, they should use the same type of trucks, and all should be palletized. A mix of smaller truckloads and LTL shipments is preferable in co-loading. Geographically, shipments with the nearest origin and destination points are a perfect choice.
There are two variations of co-loading: passive and active.
The former occurs under suitable opportunities, while the latter is planned by modifying the shipment sizes and timing. Active co-loading is more complicated to coordinate due to interferences with the inventory decisions but offers the most significant savings. To get into co-loading, a company can (DIY) do it yourself or employ a third-party logistics provider (3PL).