Pros and cons of using Multimodal Transportation

Understand Logistics & Freight

As the name already implies, multimodal transportation is when a freight forwarder uses more than one modal of transport to ship their customers’ goods from the origin to the final destination. This shipping method is usually chosen to make the movement of the cargo faster and more efficient, especially when it comes to operations of greater complexity.

The modes used on a multimodal transportation can vary from air, sea, rail and road freight, depending on the particularities of each demand. On today’s post, we will list the pros and cons of conducting this kind of operation to integrate your customers’ logistics needs. Check it out!

Pros and cons of multimodal transportation

Pros

• Centralizes all the movements under your control

Offering multimodal transportation means that your company is ready to be in charge of integrated logistics demands. Besides providing customers with a one-way solution (which can put you one step ahead of the competition), having control over your customers’ entire operations will also give you more authority as a forwarder. In other words, you’ll have the flexibility to manage and plan everything according to what you believe its best for the operation.

• Enables you to offer more competitive fares 

Another advantage of offering this kind of transportation method is the ability to offer competitive fares. Most of the times, a forwarder is able to negotiate better prices when they are in charge of the entire logistics operation rather than just one stage of it. This happens because you’ll have a broader perspective of the shipping process and how to optimize costs in each step of the way.

• Makes customer freight more agile 

Reducing the shipping time is probably the biggest reason why someone chooses to hire a multimodal transportation. If you offer this kind of service, you’ll be able to deliver your customers’ cargo with unparallel agility. The biggest reason for this is that the same staff will be in charge of monitoring the entire shipping process, therefore, communication along the journey will be much more smooth and time-effective.

Cons

• Need to specialize/build partnerships in all areas

Some forwarders have a specific service, such as air or sea freight, as their company’s area of expertise and the main reason why customers choose them over the competition. However, in order to offer multimodal transportation, it is important to master in organizing shipping solutions that comprise all freight methods. This might require higher investments in terms of staff, infrastructure, and equipment. Besides, you’ll also need to count on international partners that can supply you with all the logistics assistance you need overseas!

• More bureaucracy for the forwarder

Each transport modal has its own regulations and requires handling a different kind of documentation. Aiming to provide a complete logistics service that includes more than one modal means having the customs knowledge to deal with all the bureaucracy involved in multimodal transportation demands. Depending on the complexity of the operation, this can be quite a task!

Looking for a reliable partner to take care of your multimodal transportation in Brazil?

FOX Brasil is a leading freight forwarder with experience in handling the most complex logistics operations in all transportation modes. Whether it’s by air, sea or land, count on us for the most cost-effective services in the market!