Understanding The Costs Involved With Shipping And Transport

Transportation is an inherent part of every industry, company, and field. Be it sea container transport via water, machinery transport through land or urgent material transport via air all forms of the industry are booming. It is why Australian companies like the Reef Group have seen such exponential growth. The following article https://www.porttechnology.org/news/shipping_container_fleet_market_to_reach_14.4_billion provides the statistics to prove the expansion and development of the shipping industry. Just because transport is an essential part of any business, making the decision of which firm to use for the same doesn’t become easy.
Choosing the most efficient transportation method can mean a considerable reduction in logistical costs. There are a number of aspects involved when it comes to getting a product from point 1 to point 2. Some of the most vital factors that should be considered while choosing a mode of transportation are discussed here. The first issue is always cost. The budget is the key pillar of the decision. This is because most times the cost of transport and can change the price of the good or item. The weight, amount, type and mode of transportation can alter the value substantially.
• A rail transport is the cheapest option when the goods being transferred are bulky/ heavy and need to be transported inland over a significant distance.
• If the distance is short and can be crossed via land, then land transportation makes the most sense. Trucks are the most economical when the amount of goods being transported is small. This is because there is a lot saving in packaging and handling charges.
• Air transport is the most useful for items that are perishable or have a high value. This mode of transportation can also be used for lightweight goods. It is the most efficient method of shipping but also the costliest.
• The cheapest shipping method is through the water. Sea containers and ships are appropriate for transport of heavy machinery and goods. The drawback to sea shipping is the time it takes. When delivery is not time-sensitive, and the distance is long, water transport makes the most economical sense.
When deciding upon the final mode of transportation hidden costs should also be factored. These could come in the form of insurance premiums or tax charges on import or export of goods. Keep in mind that sometimes once can save on consignment shipping if a combination of rail, sea, air or road transport is used. Other times, the term of sale set by the buyer can fix the mode of transport. Such stipulations can do away with the entire decision process.
The destination the consignment needs to reach can also alter the final decision. If the only way to enter the location is by rail, then waterways or sea transportation become out of the question. Even if the end destination of the shipped goods has access to all modes of transport, they might not be fully equipped. For example, a port might not be capable of handling large containers because they lack the equipment to do so.