Modes of Transportation in the Global Supply Chain

The Blume Global Team

The supply chain relies on the efficient management of assets and logistics to get raw materials, parts and finished products from one place to another. When you’re sending goods around the world, it’s vital to use your transportation resources in the right way. Pairing the optimized usage of containers, vehicles and other assets with effective logistics execution including financial audit & settlement greatly improves operational efficiency, security and speed.

We’ll explore the various modes of transportation in the global supply chain, how organizations can use them and why they matter.

Shipping Containers in the Supply Chain

Shipping containers and the containerization revolution have transformed how we transport goods around the world. They are a key part of “intermodal transportation” and containers are critical to the functioning of the modern supply chain.

A shipping container is a metal box structure that can be easily moved between trucks, railcars, ocean-going vessels and other transportation, quickly and easily. All shipping containers are manufactured to common standards that will fit to specific chassis, railcars and other transportation.

The standardization of shipping containers means they work to a common specification and framework. This makes it extremely easy to load, unload, manage and transport shipping containers across multiple types of transport. Containerization significantly improves efficiency and security, protects goods and ensures faster movement through the supply chain.

Trucks in the Supply Chain

Trucks are the main workhorses of the international supply chain. Alongside railways, they’re the main way to move goods across land in an efficient way. They are often fitted with chassis that can hold standardized shipping containers.

Trucks are, by far, the most common way to move goods in the supply chain. Every day, the U.S. transportation system moves an average of over 50 million tons of freight valued at more than $50 billion.

Trucks can get to places that other transportation methods cannot. Railways don’t travel to all destinations, and air freight is expensive and limited by weight and available airports. This makes trucks the default choice for moving large quantities of goods. Trucks move more goods domestically in the U.S. than railway, water, air freight and pipelines combined. When pulling a chassis, a truck can move shipping containers quickly and efficiently.

Chassis in the Supply Chain

The chassis is critical to moving shipping containers across land. Chassis are the hardware bases that connect to trucks and locomotives. They are designed to accommodate a standardized shipping container.

Chassis are another essential part of intermodal transport— the transfer of goods between various types of transport, for example trucks, railways and ocean-going vessels. They ensure that containers can be loaded and secured safely.

Chassis need to be available in the right place at the right time for the efficient loading, unloading and further transportation of goods. Without a chassis, it is impossible to move shipping containers.

Railcars and Engines in the Supply Chain

Engines pull railcars and intermodal railcar chassis which distribute products on land in the global supply chain. Although railway freight is often a distant second to sending goods by road, rail transport still accounts for a good proportion of freighted products.

Moving goods by rail is often much cheaper, more efficient and less environmentally damaging than sending goods by road. Almost $500 billion of freight is transported by rail in the U.S. every year, with many trips of 1,000–1,500 miles or more.

Freight railroads are a vital supplement to trucking for moving goods through the supply chain. Railroads moved almost 14.5 million intermodal shipping containers in 2018. Intermodal transport accounts for a significant part of U.S. freight rail revenue.

Aircraft in the Supply Chain

Specialized commercial cargo aircraft are used to ship freight quickly and efficiently between and within countries.

Commercial cargo aircraft are typically loaded with Unit Load Devices for moving air freight between airports. Due to the higher cost of air freight, it is often used only for the most critical shipping needs, and most supply chains will use it as a supplementary service after trucks and railroads.

Aircraft excel in two main areas for transporting goods, speed and reliability. Aircraft are generally the fastest way to get freight from one place to another, vital when time is an issue. Air freight is also more reliable that other forms of transport, as aircraft are less affected by delays than trucks.

Unit Load Devices in the Supply Chain

Unit Load Devices (ULDs) are specialized storage and transportation units, mainly used to move goods via air freight. In most cases, ULDs are specifically designed for commercial, supply chain applications.

ULDs consolidate goods together into standardized pallets or other storage units. These units can be moved via forklift and other machinery, making it fast and easy to load and unload aircraft.

Commercial freight aircraft come in a variety of sizes and capacities. ULDs introduce standardization for transporting goods, enhancing safety, speed and efficiency. The right ULD needs to be available at the right time to maximize throughput and shorten end-to-end air freight delays.

Ocean-Going Vessels in the Supply Chain

Large container ships and other ocean-going cargo vessels are the primary way to move goods internationally. Ocean-going vessels include container ships, oil tankers, general cargo ships and bulk carriers.

Ocean-going vessels move goods between international ports in the global supply chain. These ships are designed for rapid loading and unloading and are well-served by transport infrastructure for the rapid onward distribution of goods.

The international shipping industry is responsible for around 90 percent of world trade. Container ships and other cargo vessels transport vast amounts of raw materials, parts and finished products between international suppliers, manufacturers and final destinations.

The Importance of Asset Management, Logistics Execution, Financial Settlement in addition to Visibility to the Supply Chain

Strong asset management and logistics execution is vital to fast, efficient and cost-effective supply chain operations. You need the right asset, in the right place, at the right time and in the right condition. The more reliable your supply chain asset management software, the more you will reduce waste, eliminate delays and maximize profit margins. A comprehensive logistics solution also includes freight audit and pay which provides a consistent, fair and frictionless invoicing and paryment process.

Blume Assets lets your supply chain team manage key assets across the entire supply chain lifecycle. You get accurate and dynamic asset tracking, financial management and maintenance and repair.

Maximize asset efficiency, placement and utilization through advanced technologies, including machine learning, artificial intelligence and Internet of Things. Blume Assets also creates an asset management marketplace for any transportation asset class and geography, and facilitates collaboration between multiple asset owners and classes.

Blume Logistics enables multi-modal global logistics execution & transportation booking including shipment rating, routing and automated carrier selection. Blume brings a network of carriers along with technology applications to enable the end to end optimization of your global movements.

Blume Visibility enables air, ocean, rail and motor carrier connectivity (API, EDI, IoT, TMS) for comprehensive tracking of assets, shipments and inventory at rest and in-motion. It monitors events and provides predictive ETA, impact analysis and automated problem resolution to easily connect, monitor and respond on one platform.

Blume Finance provides transparency and granular visibility for freight audit and pay with a smart contract repository, rating management and validation, machine learning-driven invoicing, cost accrual auditing and blockchain-enabled payment and settlement. Blume Finance’s unique “buy side” and “sell side” capabilities provide value to those that sell transportation services, buy transportation services and do both.

Contact Us