When you talk about your supply chain, or the distribution link in it, “transportation” will very likely pop up in the conversation. After all, can a supply chain even exist if materials and goods don’t move from one place to another?
As key as transportation is to supply chains and distribution, “multimodal transportation” is less likely to enter into the conversation. Yet it is one of the best ways for shipping companies to improve transportation efficiency and reduce costs. Business Wire calls multimodal freight transportation “the backbone of international trade”.
As global trade and local delivery continue to explode, intermodal transportation, which includes a combination of two or more modes of transportation (eg., road, rail, air-sea), is touted as the best way to take advantage of international sourcing, the localization of production and warehousing services, and the massive increase in freight volumes.
Why Intermodal Transportation?
According to statistics included in the Business Wire report, mode optimization has the potential to drive the following benefits for shippers of all sizes.
- 30% improvement in transportation efficiency
- 10% reduction in cargo damage
- 20% reduction in transportation costs
- 50% reduction in highway congestion
- 33% savings in energy costs
- 33% lower carbon emissions
As impressive as those numbers are, it is what they can facilitate, and some of the other benefits of multimodal transportation, that really makes it key to doing business in the new normal.
- Intermodal Levels the Playing Field – Lower costs and global reach lets even the smallest players get to market and compete with multinationals
- It’s Transportation-Disruption Averse – When shippers are more in tune with choosing different transportation modes to optimize costs and efficiency, they are also more connected and ready to find ways to continue to ship even when their usual routes are disrupted.
- Future-Ready – Whether it’s technological advances or new business models, multimodal is positioned to take advantage of technology and fit new models that demand greater speed, efficiency and more sustainable transportation.
For more ways to improve your transportation bottom line, check out our article “How to Reduce Your Transportation Logistics Costs”.