In freight, as in life, different is good. Just as differences between people are worth celebrating, so too are differences in how companies approach shipping transportation. And while sameness in life can be boring, clinging to sameness in logistics can actually come at a cost as competitors embrace new approaches - leaving you behind the curve.
Let's take a look at a few ways to differentiate your freight operation that will not only make you stand out, but also lead to positive impacts like cost savings, improved flexibility, a lower environmental impact, and more.
Use a different freight mode
Between 70 and 95% of freight is moved via truck in the U.S., so using truckload is the pinnacle of sameness. The good news is, there is another way. Intermodal transportation - with a domestic market share hovering around six percent - has plenty of opportunity to move more cargo. Its door-to-door solution can cover most origin-destination pairs, combining the flexibility of short-haul truck with the sheer capacity and efficiency of long-haul rail.
To diversify is simple. It's all about working with an IMC which works directly with railroads and drayage providers to offer a seamless experience for the shipper. The typical qualities of a good intermodal lane are a long-haul of 600 or more miles with a dray of 50 to 100 miles, but even that criteria is flexible. With freight rail carriers covering the continent combined with dray carriers stationed all over, shippers can count on reliable service with transit times only slightly behind a typical truckload journey.
Benefits of intermodal
Intermodal transportation offers many benefits over truckload options. First off, intermodal is simply less expensive than over-the-road almost all the time. Average savings is 10-15% - with higher figures in some situations. While that alone is reason to incorporate intermodal, those valuing sustainability can see another clear benefit.
Rail transport is significantly more fuel-efficient, roughly four times in fact, and every load switched to rail takes a truck off the road - reducing both emissions and congestion. A single intermodal train can carry the equivalent of 280 trucks, which not only helps the environment and traffic issues, it also shows an additional benefit - plenty of reliable capacity.
Use different shipping containers
When shipping via truckload (or less than truckload), the most common method is with a 53-foot trailer. For intermodal, there is the similar 53-foot domestic container. But another shipping container option can be a win-win for shippers and providers alike - the ISO ocean container. Once a company has embraced intermodal as part of its shipping strategy, exploring ocean container repositioning is a worthwhile option.
In essence, repositioning involves using ocean containers (generally of the 40 or 45 foot variety) that are left empty upon inland delivery, and filling them with freight as they travel back toward the port or another location to be used for export. This makes for added container capacity while reducing the number of empties moving across the country. The best fit for ocean container intermodal tends to be for heavier products that would weigh out before filling a traditional 53-foot space. These slightly smaller containers are packed more tightly with product, so it reduces the need for blocking and bracing. Otherwise, the process is just like traditional intermodal.
Benefits of ocean container repositioning
Moving freight via ocean container repositioning not only gets shippers the benefits they already gain from intermodal, it takes them a step further. Ocean carriers offer incentives to fill their empty containers as they reposition them to areas of deficit, so that further savings is passed along to the shipper. The service is still as simple as any other as well, as IMCs provide a single point of contact and bill as they coordinate the entire process.
Environmental positives are two-fold as well, with ocean containers following the intermodal route for greater sustainability in addition to the fact that filling these containers prevents them moving empty - and takes away the need to move an extra container in its place. The win-win in this process goes for shippers benefiting from additional cost savings while the carrier still recovers the cost of container movement by avoiding shipping air.
Use different technology
The integration of advanced technology is revolutionizing freight and logistics - and it pays to be a part of it. Tools such as Transportation Management Systems (TMS), real-time tracking, and predictive analytics enable companies to optimize routes, manage inventory more effectively, and enhance visibility throughout the supply chain. And of course, you can't discuss new technology without mentioning artificial intelligence (AI), which is evolving at a tremendous rate.
Anecdotally, many in the shipping space are still behind the curve - using email, spreadsheets and even paper processes. When it comes to maintenance and repair for instance, Paul Burgoyne, CEO of REACH (a software/app that handles processes digitally) recently told the Intermodal Logistics Podcast that the vast majority are still missing out on digital tools and instead handling processes manually.
Benefits of new logistics technology
By adopting these technologies, businesses can achieve significant cost savings and improve service levels. For example, real-time tracking allows for better coordination and communication, reducing the risk of delays and improving customer satisfaction. Predictive analytics can help anticipate demand and optimize inventory levels, ensuring that products are available when and where they are needed.
Using a TMS - something that's easy for businesses of any size thanks to cloud-based options - not only centralizes shipping operations but allows for integrations of most of the other technologies noted above (as well as load boards, market data and back office tools) in one place. Carriers, logistics providers and shippers all benefit from its use. For maintenance and repair, apps like REACH seamlessly connect carriers and drivers with technicians, create cases and allow progress tracking every step of the way.
Use different transportation providers
Because of their sheer size, most shippers work with the largest logistics providers. In the intermodal space, companies like J.B. Hunt, Schneider and Hub Group have an outsized presence. And while the bigger companies do have their own strengths and resources, that can be a double-edged sword as they are often bound by those same resources. For instance, about two-thirds of containers are owned by the five largest IMCs .
These large providers operate drayage and general truckload carriers as well. Again, that all sounds good as a one-stop shop. However, working in their ecosystem can either symbolically or literally bind shippers to these assets and have them missing out on another third of intermodal container capacity, ocean container options and extensive truckload and drayage options.
That then trickles into pricing - as working exclusively with a large provider puts the shipper at its mercy for rates that may be lower elsewhere and fees that others may not institute. And while that size also means more employees and more proprietary systems, it's easier for individual shippers to get lost in the shuffle with so many clients.
Benefits of working with a smaller provider
Partnering with smaller providers can improve customer service and communication, with companies like InTek offering a dedicated operations professional running point for each client - offering updates, feedback and making changes on the fly to ensure optimization. Smaller providers can also offer cost savings.
Without the overhead associated with larger companies, smaller providers can offer competitive rates and more transparent pricing - even if larger providers can win on bulk pricing at times. Additionally, non-asset providers are not bound by their own equipment - instead, they're able to access a vast array of intermodal and trucking capacity to put together the best combination for each shipment. They also offer agility, allowing them to respond quickly to changes in demand, ensuring that your logistics operations remain smooth and efficient.
As an IMC and a truckload broker, InTek has direct relationships with railroads and trucking carriers (dray and truckload), offering a diverse suite of options to move freight. Speaking of variety, to reap the benefits of both asset and non-asset providers, shippers can consider working with both.
Use a different shipping operation
Many companies prefer the idea of keeping just about all operations in-house. But doing so for shipping and logistics can put some - especially smaller businesses - at a disadvantage. Outsourcing - a sometimes dirty word that shouldn't always be - freight management, also known as "going managed," means turning a company's logistics department over to a third party logistics provider (3PL).
The 3PL then handles all the day-to-day shipping operations, booking loads, coordinating pickups and deliveries, tracking shipments, and more. In fact, managed transportation providers can take care of capacity and bid procurement, rate quotes, freight modes, load and route planning, executing shipments and settling up with invoices, payments and audits. Shippers decide how much or little to outsource in these scenarios, a balance that can be adjusted on an ongoing basis.
Benefits of outsourcing freight management
Outsourcing freight management to a 3PL can provide companies with the expertise and resources needed to navigate the complexities of logistics, freeing up internal resources to focus on core business activities. This is especially helpful for companies with limited staff, as it allows them to confidently turn over shipping operations without having to keep one eye on logistics and another on what they do day-to-day.
Providers offer specialized knowledge and technology like TMS just by working with them, enabling businesses to streamline operations and reduce costs. By leveraging the capabilities of a 3PL, companies can benefit from improved scalability and flexibility, allowing them to adapt quickly to market changes. Outsourcing also provides access to a broader range of services, from warehousing to last-mile delivery, ensuring a comprehensive and efficient logistics solution.
Embrace different freight approaches
Embracing different freight approaches can put a business at a competitive advantage over others in its space. From looking at other freight modes like intermodal to outsourcing operations, shippers will find that moving out of lockstep with similarly situated companies will become a strength - differentiating them in a positive way both operationally and reputationally.
Ready to embrace those differences? Reach out to us by requesting a quote, and we'll discuss how we can help you achieve your shipping and business goals. For more information about InTek Intermodal, or the logistics and supply chain space in general, check out our Freight Guides.
