LCL retailing is a common activity in import and export, helping small business units import goods without spending too much. So what is LCL? What are the specific characteristics and processes of retail delivery? Let's find out with SIMBA GROUP through the article below!
What is LCL - Retail consolidation?
- Firstly, let's learn the concept of LCL. LCL stands for Less-than-container load, also known as odd/consol/complex. These are shipments that are not large enough to fill a full container of goods.
- Formerly LCL stands for "less than (railway) car load" and is commonly used in rail transport. The term LCL means that many different cargo owners with small quantities of goods combine together to transport the same train car to be more economical and efficient.
- You can simply understand that when it comes to LCL or LCL retail, it means that different small shipments are collected at one point, which is the CFS warehouse, and then put together in one. container and then shipped.
- Therefore, in import and export activities, goods owners who do not have enough goods to fill 1 container can choose the LCL consolidation solution to save their shipping costs.
What are the characteristics of LCL retail shipping?
For LCL, bulk cargo consolidation services, there will be specific main features as follows:
- The goods owner will have to bear the cost of transporting the odd goods to the locations where the odd goods are packed into the container. Usually this location will be a CFS (Container Freight Station) warehouse.
- The owner of the goods will have to provide the necessary documents of the goods and receive the bill of lading “House Bill of Lading” issued by the forwarding company.
- LCL is a type of transportation service that combines two shipping methods, FCL (Full Container Load) and LCL (Less-than-container load), so the delivery process can be understood in two ways:
- Ship in full container, deliver in retail (FCL/LCL)
- Ship in retail, deliver in full container (LCL/FCL)
What is the difference between LCL (LCL) and Full Container (FCL)?
In import and export activities, LCL and full container will have different characteristics as follows:
For LCL
- LCL stands for Less than container load .
- Is a service to transport retail goods when the consignor If you have 1 small package to save costs, packing 1 container together will save the most for the owner.
- A business person who collects goods from many shippers is called a consolidator.
- Diversity of different items
- Unlike FCL, the LCL shipper is responsible for loading the goods into the container as well as unloading the goods from the container.
- The consignee receives the bill of lading “House Bill of Lading” (House B/L) issued by the consolidator company.
- Retail goods are brought to the CFS (Container Freight Station) retail warehouse to gather for packing.
- LCL shipping is a combined shipping service between two shipping methods FCL (Full Container Load) and LCL Less-than-container load, which can be: 1) full container shipping, retail delivery (FCL/LCL). ); 2) retail shipping, full container delivery (LCL/FCL).
For full container cargo (FCL)
- FCL stands for Full container load
- Is a full container shipping service.
- Goods in the container belong to one shipper.
- The goods are usually homogeneous (same) enough to pack 1 container, this is the most economical option.
- The shipper is responsible for packing the goods and the consignee is responsible for unloading the goods from the container.
- Shippers can receive the Master Bill of Lading (Master B/L) from the Shipping Line or the “House Bill of Lading” (House B/L) bill of lading from the forwarding company.
- Do not put into CFS warehouse
- Transport method: send full container, deliver full container (FCL/FCL).
How does the consolidation process take place?
The process of LCL retail consolidation or delivery will take place according to specific steps as follows:
LCL retail import process
Step 1. Sign a foreign trade contract
The exporter (Exporter) and the importer (Importer) will sign a foreign trade contract after negotiating and agreeing on the terms of the contract such as types of goods, goods specifications, and unit prices of goods. , payment terms, applicable Incoterms, loading date...
Step 2. Apply for an import license (if any)
The importer will apply for an import permit if the goods are in the group of goods. Imported goods are subject to conditions and must be licensed by state management agencies. If imported goods do not require a permit, this step can be skipped.
Step 3. Pay for the goods to the exporter
The importer will make a deposit or pay for the goods according to the previously signed foreign trade contract after obtaining the necessary import permits (if any).
Step 4. Confirm delivery and check the set of documents
- Based on the Incoterms and the delivery date contained in the signed contract, the exporter will deliver the goods to the importer. After completing the delivery, the exporter will complete another set of export documents of the goods in accordance with the foreign trade contract to send to the importer.
- This set of documents will need to be properly checked to ensure that the importer receives the goods smoothly.
Step 5: Do customs procedures for imported goods
- After the goods are transferred to the port, the importer will bring all kinds of documents to carry out customs procedures and clear customs for LCL retail shipments.
- At this step, if the goods owner cannot do the customs clearance for the shipment by himself, he can use additional customs declaration services from the forwarding company.
Step 6: Transport the goods to the warehouse
- After receiving the customs declaration stamped and signed for supervision, the importer can carry out the export slip with barcode to receive the goods at the CFS warehouse.
- When fully receiving goods at the CFS warehouse to transport to their own warehouse, then the two parties will complete the LCL retail delivery process.
LCL retail export process
Step 1. Sign foreign trade contract
Similar to the process of importing LCL retail goods, the process of exporting goods also starts from the step of signing a foreign trade contract. The two exporters and importers will agree on the terms, quantity, packaging, etc., and then come to sign a foreign trade contract.
Step 2. Receive payment for goods from the importer
The exporter receives a deposit or payment for the goods in accordance with the specified foreign trade contract.
Step 3. Delivery and export documents
- Based on the Incoterms and the delivery date specified in the signed contract, the exporter will arrange and deliver the goods to the importer.
- If the Incoterms condition included in the foreign trade contract is CFR/ CNF/ C+F/ C&F or CIF, the exporter will be responsible for transporting this shipment. To arrange for shipment of LCL shipments for export, the exporter must perform the following 6 steps:
- Choose the right forwarding company that provides LCL (Consolidator / Master Consolidator) consolidation services.
- Make a reservation (booking) with the retail consolidation company LCL
- Car rental, domestic transfer (trucking)
- Packing goods according to signed foreign trade contract
- Carrying out export customs procedures for the shipment
- Transport the shipment to the CFS warehouse for delivery to the LCL retail consolidation company.
Step 4. Send the export documents to the importer
After completing the delivery, the exporter will complete the set of export documents as specified in the foreign trade contract and send it to the importer.
How to calculate LCL retail freight
What is CBM? How to calculate CBM
- CBM stands for CuBic Meter, also known as cubic meter (m3). CMB is the most common unit for measuring the volume of goods.
- To be able to calculate the volume (volume) of goods in units of CBM (m3), you will have to apply the formula to calculate CBM as: Length (m) x Width (m) x Height (m)
- To calculate the volume of CBM for goods more quickly, you can use the CBM calculator at: https://www.cbmcalculator.com/
What is Metric Ton? What is Freight Ton and Revenue Ton?
Freight Ton (abbreviated as FT) and Revenue Ton (abbreviated as RT): is the LCL freight rate calculated by comparing the freight by volume (CBM) and freight by weight (MT). . Whichever method gives the higher freight rate will be applied to the shipment.
How to calculate LCL retail freight rates
To calculate the LCL retail freight rate, you need to follow the specific steps as follows:
- Step 1: Measure the dimensions of the Long, Width, and High sides of the package in meters (m). Example: If your parcel dimensions are Length: 3.2m x Width: 1.2m x Height: 2.2m, the volume of that package will be: 3.2 x 1.2 x 2.2 = 8,448 CBM.
- Step 2: You weigh the package to determine its own weight and calculate it in tons (MT). Example: You weigh your package and know its weight is 1.2 tons (1,200 kg).
- Step 3: Based on the LCL freight rate quoted by the retail consolidation company, you will calculate the freight rate in 2 units of volume and weight. Example: If the freight rate quoted by the shipping company is 12 USD/ton of cargo, the freight rate for the package in the above example would be:
- Rates by volume (CBM) are: 8,448 CBM x 12 USD = 101,376 USD or:
- The freight rate by weight (MT) is: 1.2 tons x 12 USD = 14.4 USD
- Step 4: You compare the rates between the two ways above and choose the higher one. That higher rate will be applied to your package.
Quotation sheet for CONT and sea shipping of SIMBA Group
For customers wishing to combine CONT and sea shipping, you can refer to the prices below:
Note: The prices below are for reference only and may change depending on the actual situation and time. If you want to know more about the price, you can contact us directly through the hotline.
Price list for bulky goods
Mass
(Unit: /M3) |
Hanoi |
Ho Chi Minh |
|
< 5CBM |
1.920.000 ₫ |
1.650.000 ₫ |
|
5 - 10CBM |
1.750.000 ₫ |
1.500.000 ₫ |
|
10 - 15CBM |
1.600.000 ₫ |
1.360.000 ₫ |
|
15 - 20CBM |
1.450.000 ₫ |
1.250.000 ₫ |
|
20 - 25CBM |
1.310.000 ₫ |
1.200.000 ₫ |
|
> 25CBM |
1.200.000 ₫ |
1.050.000 ₫ |
Price list for heavy goods
Mass
(Unit: /Kg) |
Hanoi |
Ho Chi Minh |
|
0.5T |
10.000 ₫ |
8.500 ₫ |
|
0.5 - 1T |
9.000 ₫ |
7.500 ₫ |
|
1 - 2T |
8.000 ₫ |
7.000 ₫ |
|
1.5 - 3T |
7.500 ₫ |
6.300 ₫ |
|
3 - 5T |
6.800 ₫ |
5.700 ₫ |
|
> 5T |
6.000 ₫ |
5.200 ₫ |
SIMBA - Prestigious and reliable provider of LCL collection and transportation of raw materials
Fast, on time, save time
SIMBA we know that our customers' time is extremely valuable and appreciated. Therefore, we always ensure the exact time and on schedule to be able to deliver to you.
Therefore, coming to SIMBA, customers will save a lot of their own time because of accurate and fast delivery and delivery procedures.
Professional and qualified staff
Most of SIMBA's staff are highly qualified people, experienced in handling customer transactions quickly but still giving you the most satisfaction.
Cost savings
SIMBA is sure that we are one of the lowest-cost retail consolidation service providers. This coupled with quality service will save customers even more.
Prestige top priority
Professional - Careful - Dedicated. These are the three golden slogans of SIMBA GROUP staff. When using our services, you will be assured of maximum safety for your goods, avoiding damage and loss of goods.
Above is the information about LCL retail collection that SIMBA GROUP wants to send to you. Hopefully, this article will help you in the process of doing business as well as importing goods.
If you are intending to import goods in small quantities and save costs. Contact SIMBA GROUP immediately for a free and direct consultation on retail and container shipping services.
- Address: Hanoi Office: 21st Floor, Tower A, Song Da Building, Pham Hung, Nam Tu Liem, Hanoi
- HCM Office: 4th Floor - DTC Building, 99 Cong Hoa, Ward 4, Tan Binh District, HCMC
- Hotline: 0379 311 688
- Email: media.simbalogistics@gmail.com
