When it comes to the transportation of goods and materials, two terms are frequently used to define the modes of transport in the logistics world: intermodal and multimodal. At DG International, we are freight forwarders who specialise in offering multimodal solutions, but it is our stern belief that anyone should be able to understand the difference between the two, which we outline is this handy blog.
In the most basic sense, multimodal transportation is the means to utilise multiple methods of transport to get goods from origin to final destination. This can be done via air, sea, road and rail freight in any combination which can be operated by either a single or multiple carriers along the way.
However, its important to note, either way this will likely be under a single contract or a Bill of Lading. Even if additional carriers are involved in the journey, one carrier assumes exclusive responsibility and ensures door-to-door delivery.
You can instruct your freight forwarder to set up a single contract for your company to use as an experienced agent. Freight agents like this are highly experienced with all the customs processes and would handle all of the negotiation while you only have one contract to oversee. The agent would also be responsible for coordinating loading, unloading, and managing any delays.
A Bill of Lading is a type of legal document that is used when shipping goods to signal responsibility, accountability and liability.
When the goods are being shipped they are loaded and the Bill of Lading is given to the shipper, and upon delivery it is then given to the buyer/consignee.
This allows the shipper to release the goods and transfers ownership (thus the responsibility) of the goods to the buyer. The Bill of Lading also acts as a type of receipt to demonstrate the cargo has been fully loaded onto the vessel and then transported to the consignee.
Intermodal Transport is similar to multimodal transportation in that it still entails moving cargo (FEU and TEU containers) from origin to destination whilst utilising multiple modes of transport. However, where it differs from multimodal is that each mode of transport is operated under different carriers. This means that each leg of the journey requires independent contracts, unlike the single contract for multimodal transportation.
Ultimately, the intermodal strategy reduces cargo handling, which enhances security, reduces damage and loss, and speeds up some aspects of freight delivery.
There are multiple factors that could mean you need to consider using intermodal transportation.
Whether you decide to use intermodal or multimodal transportation you will require one or more Bill of Lading and a Transportation Management System (TMS). This allows door-to-door tracking visibility for the shipper.
In Multimodal transportation you only require one Bill of Lading which your multimodal transport operator (MTO) is responsible for issuing to you. However within Intermodal transportation you will require a Bill of Lading for each carrier that you use during your shipment which can only be issued by the individual carrier.
There are several ways in which cargo can be damaged, stolen or lost during transit, across all modes of transport. This can depend on the type of packaging, the route taken to deliver, the effects of unexpected weather and certain piracy hotspots. Luckily you can purchase different types of cargo insurance to cover your goods from these issues. Most freight forwarders will offer cargo insurance as standard or there is the option to source this via a third party.
As stated above you can take out insurance to cover your shipments from damages, piracy, or being lost. It is not a necessity but it is highly recommended to get insurance to cover your goods, especially for the shipper.
We have also written a blog discussing the topic: what is marine cargo insurance.
To summarise both intermodal and multimodal transportation offer benefits, however when deciding which is best for you, you must evaluate the specific needs of your shipment such as length of the journey i.e.: how long will it take, or how much your cargo weighs etc.
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