Aug 22, 2017

Selecting the best mode of transportation for your shipment can be complicated. There are so many factors to consider, such as, what’s being shipped, how far it’s traveling, and how quickly it needs to reach its destination. If you’re trying to decide between intermodal and multimodal, you may be wondering what makes them different and how you know which to use. Below we take a closer look at both options, what they are, their differences, their advantages and what to consider when selecting one over the other. 

Let’s start with a couple of definitions:

Intermodal: Intermodal transportation is the movement of goods in an intermodal container or vehicle, using two or more modes or carriers, during its journey from shipper to consignee. To learn more about intermodal shipping, read our previous posts about what it is and its benefits. 

Multimodal: Multimodal transportation, also known as combined transportation, also involves the use of two or more modes or carriers, but with one contract through a single carrier who is legally liable for the entire process. This carrier doesn’t necessarily perform all service to complete the shipment’s journey. In fact, much of the transport is performed by sub-carriers which are called “actual carriers”. The legally responsible, contracted, carrier is called a multimodal transport operator or MTO. 

They sound very similar in these definitions except for the fact that Multimodal has a single carrier responsible for the entire process. So what else makes the two different and why would you select one over the other? 

The biggest difference between the two is the number of contracts involved in each. 

In multimodal, the shipper has a contract with one carrier that covers the entire journey of their shipment, regardless of the number of modes involved. The contracted carrier issues a Combined Transport Bill of Lading or a Multimodal Bill of Lading. The advantages include:

• The ability of the shipper to hold one carrier liable for the movement of their freight
• One contact for tracking a shipment
• One responsible entity for meeting delivery requirements

In intermodal, there are multiple contracts – one with a freight forwarder or ocean carrier, one or more with a trucking company, and one or more for rail transportation. Each carrier issues a separate Bill of Lading in intermodal shipping. The advantages include:

• The ability to select carriers for each leg of the shipment based on price or service
• Being able to stop the shipment at any point for any reason
• More flexibility in carrier selection when equipment or space issues arise. 

Why would you select one over the other? 

Here are several questions to consider when selecting between intermodal and multimodal:

• Do you want multiple independent contracts with multiple carriers?
• What is the total cost difference between both options?
• How will each option impact inventory turns and costs?
• How much time savings is involved in one option versus the other from transit time and administrative coordination?
• What is the environmental impact of each option?
• How much paperwork will end up being involved in each?

Still not sure which is a better choice for your shipments? Contact American Group by phone at 866-553-6608 or by email at Rates@ShipAG.com. We have years of experience and are able to guide you through this process for Shipping.Simplified®.

 

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