Intermodal and Multimodal Transportation: What’s the Best Option For Your Business?

two engineers agreeing on Multimodal Transportation agreement in ship yard

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This post was last updated on May 17th, 2022

When it comes to delivering your goods to the other side of Canada or even to the other side of the world, shipping through several transportation modes comes naturally as the answer to overcome natural barriers, be cheaper or even faster.

However, did you know that there are several ways to proceed?

Let’s explore the differences between multimodal and intermodal shipping to see which is best for your needs!

What is Known as Multimodal Transportation?

The premises of multimodal transport

According to research work on “Multimodal Transport Law and Operations” produced by the Association of Southeast Asian Nations, an early version of the multimodal concept was first introduced in the United Kingdom in the mid 19th century.

The Birmingham & Derby Railway company started to transfer rail containers to horse carriages as an alternative to the single-mode transport systems dominant at the time.

What is multimodal transportation?

Multimodal transportation, as its Latin etymology could let us think, is the use of several (“multi”) modes of transport (“modal”) to ship cargo from point A to a final destination.

A multimodal shipment is often managed by a multimodal transport operator (MTO), which are transportation companies that have access to different shipping modes of transportation.

Today, multimodal transportation is used extensively worldwide for both international and domestic freight movement because it offers significant cost savings compared with other methods of transporting goods over long distances or across borders to a different country.

What is the specificity of multimodal services?

In multimodal transportation services, there is only a single contract that covers the entire journey of the cargo from origin to destination.

This means the multimodal operator you will contract will handle the freight from A to Z as a single carrier.

What are examples of multimodal transport?

Multimodal shipping can include sea, rail, road, or air freight and ensure a port-to-door service.

What are the pros of multimodal shipping?

As the contract is handled by one carrier only, this service can sometimes lower transportation costs.

How so? Think about the fact that you can negotiate a combined transport bill for the total shipping cost and don’t have to pay the different logistics coordination rates of several carriers.

Other advantages of multimodal shipping are ensuring better control over tracking, quality, and security. They are also accountable for the entire carriage. Indeed, you are not dealing with different providers here, so everything is more straightforward to handle and monitor.

Talking logistics now, the fact the contracted carrier handles everything on the supply chain, they have a clear organization and view of the pick-up and transfer of the goods from one mode of transportation to another. This can also show a faster delivery time.

Multimodal transport coordination is just very streamlined and effective.

What about intermodal transportation?

What is intermodal transportation?

Well, if multimodal shipping offers a wide range of logistics services with several modes of transportation, know that the concept behind intermodal transportation must be closely linked to it!

Intermodal shipping is the transportation of goods between intermodal terminals using more than one mode of transport thanks to a single container, but this time, under several contracts.

What transportation mode are used in intermodal freight transport?

Here too, the intermodal transport modes are diverse and combine the benefits of all the multiple modes of transportation.

An intermodal shipment allows businesses to move their cargo through truck, rail, air, or sea freight, with the help of multiple carriers.

What are the pros of intermodal shipping?

With intermodal transportation shipping, other advantages emerge from contracting several transport carriers.

Businesses often like intermodal services because they have more control over their shipments. They can choose which mode of transport to use on each step of the journey, and ensure their cargo ships in the most effective way.

Also, relying on multiple contracts allows you not to put all your eggs in one basket and be dependent on a single carrier. Here, you keep control over each leg of the shipment: If a carrier becomes problematic, you can quickly bounce back to find another solution.

This also means that you could eventually re-negotiate terms separately all your freight costs with each provider and maybe, get cheaper shipping bills. However, dealing with several carriers could also imply duplicate charges or services.

In addition, intermodal transport shipments are more secure and help businesses simplify inventory management by having a single container for all goods instead of multiple containers with different freight carriers.

How to optimize your intermodal shipping strategy?

If you are not sure what you are looking into, don’t lose any more time nor money, and get in touch with experts.

At RailGateway, we are full load intermodal rail shipping specialists based in Canada, and we can advise you and help you get the best rates for rail shipping. Indeed, whereas handling separate transport carrier can be confusing and require more logistics coordination, we make any rail intermodal movement easy by gathering it all under a unique solution.

We have also been working with CN and CP for a long time and are now able to offer low pooled volume prices, which reduces inventory costs and total shipping costs of our clients’ logistics.

Do you wanna have a look at how much you could win working with us? Get a free rail freight quote now!

Combined Transport Shipping Strategy: What to choose Between Intermodal and Multimodal Transport?

In the end, what differs intermodal from multimodal transportation?

Intermodal transportation can actually be seen as a subset of multimodal shipping.

Multimodal shipping goes beyond the use of several modes of transportation. It offers an added value in coordination and organization as they can offer all shipping modes under a single contract whereas intermodal shipping offers its clients the possibility to combine different carriers and contracts in order to receive a supply chain services tailored to their needs.

What to choose for your shipping strategy?

Multimodal services are more comprehensive and cover all aspects from origin to destination.

In other words, multimodal transport is the best way to go if you are looking for a one-stop shop and low organization on your part when it comes to shipping your goods, but it might come at a higher price and less safety and control of your shipments.

Intermodal transportation is a more tactical approach.

You can monitor all aspects of the cargo flow and negotiate your own terms with several carriers, which can end up to be very beneficial.

However, it’s a bit more time-consuming, can require some good logistics knowledge and organisation skills if your team organize the full intermodal journey themselves.

In the end, between multimodal and intermodal transportation, that’s your choice to make! There is no right or wrong answer.

It depends on your organization’s needs and the resources you have to handle the logistics to go over several contracts or not.

Another solution we haven’t talked about is hiring an agent or shipping experts who will work on several shipping freight contracts for you.

If you’re ready to make the jump and conquer the other side of Canada with your products without worrying about anything, make sure to request a quote on our website for our full load intermodal rail shipping services. From Montreal to Vancouver, we’ve got you covered!

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