As more shippers look to reduce freight costs and their carbon footprint, intermodal logistics continues to see rapid growth. The Intermodal Freight Transportation Market has predicted a Compound Annual Growth Rate (CAGR) of 8.27 percent from 2021 to 2026 for intermodal logistics. And with intermodal peak season on the way, shippers using this mode must have the right shipping strategies in place.

Intermodal can be a very effective mode when it matches up with the right customers, but with the rapid growth of customers choosing intermodal logistics, we often hear a similar question from our shipping customers: “What should I expect during intermodal peak season?” So, let’s learn more about what peak season for intermodal is, how it may affect you, and what you can do to stay ahead.

WHEN IS INTERMODAL PEAK SHIPPING SEASON?

Peak shipping season refers to the time of year when freight volumes see an influx. For most modes, this falls in line with the time of year when retailers begin pushing inventory for back-to-school and the holiday season. During this time, shippers try to keep up with demand and manage inventories while fulfilling a high volume of orders, and motor carriers are busier than usual trying to deliver freight on time.

Historically, the peak shipping season for intermodal logistics is around June to December. While June may seem a bit early, many shippers are rushing to get their goods through West Coast ports before June 30^th, and rail is a popular way for shippers to transport their West Coast imports. According to the Alameda Corridor Transportation Authority, since 2006, the number of goods imported and then loaded into intermodal equipment through Los Angeles and Long Beach ports has grown 25 percent.

With roughly two-thirds of intermodal containers coming off the West Coast from import traffic during peak season, this limits the supply of 53’ containers heading East.

Even though June is the typical start of peak season for intermodal, it can fluctuate. Some years it can be later or earlier. But since the start of the pandemic, intermodal logistics have been greatly affected by capacity, making peak season more year-round than in former years. This is because of the rapid increase in online shopping year-round for consumers, which the pandemic only heightened.

“The past two years since the beginning of covid-19 has greatly impacted intermodal capacity,” says Jennifer Fritz, Trinity intermodal expert. “Historically peak season for intermodal logistics usually starts June through December, but with capacity affected by the change in supply chains from covid-19, it’s been tight year-round, making peak season pressure felt year-round instead of a few months of the year.”

CHALLENGES OF INTERMODAL PEAK SEASON

Expected or unexpected, any time there is a major shift in supply chains, it can throw off your operation. So, how does peak season affect intermodal logistics? Well, it’s not much different than peak season shipping for any other mode.

You’ll see tightened capacity because of the increased freight volumes and demand. And anytime we see tightened capacity, we see increased prices as well. So, the more in demand something is with less supply, it equals higher rates.

You’re also bound to see some shipping delays and need to give longer lead times. Your usual service levels may also drop because of the overwhelming volumes of freight needing to be moved during peak season shipping. Especially lately with the continued covid-19 pandemic still affecting the market, West Coast ports, and ultimately, intermodal logistics.

Take Control of Your Intermodal Logistics During Peak Season

Make sure you’re not unprepared for intermodal peak season. Each peak season is variable, rarely unlike another, and planning is more critical than ever with it being more frequent and extreme. Here are some tips to help you take control of intermodal peak season.

Give Even More Lead Time

Book your intermodal shipments as far in advance as possible. Prices are volatile during intermodal peak season, and the rate to move a shipment through intermodal logistics can increase by hundreds of dollars over a single day. In addition, available equipment can often be an issue. This is not the season to wait until the last minute.

Stay Updated on the Industry

Ever since the start of the pandemic, it’s more important than ever to know what’s going on in intermodal logistics. As we’ve seen over the past few years, supply chain disruption can happen at any time, so make sure you check the news daily or have a good resource to give you all the information you need.

Try Shipping Later

Perhaps all your items don’t need to arrive during peak season. Great. If possible, schedule those shipments to ship after intermodal peak season, when there is more capacity and you’ll likely get a better shipping rate, or at least stagger them. So, if part of your shipment needs to arrive right away, have that delivered faster. And for any freight that doesn’t need to deliver quickly, schedule that shipment for a later date. 

Plan for Extra Time

As noted, with the influx of freight needing to be moved, there are bound to be delays. Many intermodal carriers have fully planned days and if they get delayed, it affects the rest of their movements. So, make sure you allow plenty of time for your products to get to their destination. This will help keep a delay from happening and possibly get you a better freight rate.

Shop Around

Prices can fluctuate between providers and from day to day. If you have the time, try getting prices from a few different providers or being more flexible with your dates to see if you can find a better value. For example, the difference between a 15-day delivery time and a 20-day delivery time could be significant. Check out all avenues and find what works best for your budget and freight.

Have Modal Flexibility

Sometimes a mode will max out on capacity. If capacity is reached for intermodal logistics, ensure you have relationships with over-the-road carriers or a third-party logistics company as a backup. This ensures no matter what, you’ll be able to get your freight from point A to point B.

Leverage Partnerships

Partnering with an experienced 3PL can make navigating peak season for intermodal logistics, or any logistics mode, more accessible. Companies, like Trinity Logistics, often have longstanding relationships with carriers for all modes, plus logistics technology and well-trained teams ready to help you. A reputable 3PL will have seen it all during peak shipping seasons and be able to help you manage your logistics without batting an eyelash.

GET HELP WITH YOUR INTERMODAL LOGISTICS, NO MATTER THE SEASON

While we can’t look into a crystal ball and predict how long this never-ending peak season for intermodal logistics will last, we can tell you that many logistics providers and shippers are adapting. Intermodal peak season shipping can be stressful, but these tips can help you better navigate your intermodal logistics during the peak shipping season.

If you’re looking for help, Trinity Logistics is here to support you. We have a full Team of Intermodal Experts, experienced and ready to assist you with your intermodal logistics. Simply click the button below and let’s get connected.

This is a question that many customers ponder on a daily and weekly basis. If you are a shipper or manufacturer utilizing intermodal (rail shipments) as a means of moving your freight, no doubt you already have a list of items that you consider when selecting the best intermodal logistics provider. Humor me and please keep reading anyway, I may possibly add one or two items that you haven’t considered in the past.

What’s an IMC?
First, let’s discuss what an “IMC” (Intermodal Marketing Company) is today versus what they were in years past. Many years ago when intermodal movements were just beginning on the railroads, the rail carriers quickly realized that it was very difficult for them to “retail” their service directly to potential customers. The railroads were accustomed to dealing with a shipping public with locations on their property with rail tracks running direct into their facilities! These were customers that moved grain, paper, lumber, steel, and automobiles as a few examples of the commodities that worked well for the rails.  There was untapped opportunity for new shippers and manufacturers to move their freight by train, but they didn’t have to be located close to the railroad. In fact, many rail customers are several miles from the nearest railroad tracks.

IMCs (Intermodal Marketing Companies) started popping up around the country, providing marketing and sales for the railroads. Railroads readily accepted the IMCs’ help for marketing and selling their intermodal service! Originally the functions and responsibilities of an Intermodal Marketing Company were very limited. Over time those responsibilities have changed greatly to the point they not only provide sales, pricing, and marketing, but are also responsible in many cases for securing the container to move the load as well as the draymen to pick up the load at origin and destination. The Intermodal Marketing Company also provides one other key function today they didn’t provide in years past, and that is customer service.

The #1 Differentiator
Customer service is one function that truly differentiates one Intermodal Marketing Company from another.  Some intermodal marketing companies have nearly eliminated the customer service function, relying heavily on cheap pricing to secure freight for shipping intermodal. I strongly recommend you consider customer service as a required function whether you’re renewing intermodal contracts, doing spot quotes, or just starting to move your freight by train. Let me paint a picture for you. There are only a few “Class I” railroads left in the United States and Canada, in fact only two Class 1 railroads in the West, only two in the East, and one in the Midwest. This means all of your intermodal freight will move on one of these five railroads and you’ll likely experience either good service the rail carriers provide, or you’ll suffer from issues the railroads are having. These include wash outs, derailments, hurricanes, mudslides, etc.

The element that separates the best Intermodal Marketing Company from the “less than best” Intermodal Marketing Company is how well they communicate the issues with you, the customer, and how that may affect your movement on a train. Many IMCs simply provide an online tracing tool, leaving it up to the customer to find out if any delays are going impact their shipment. Other IMCs will have automated faxes or emails broadcast to the shippers with very generic information about the issues. The “best” IMCs will create the type of communication you value. They will offer the online tracking combined with a personal touch and contact when you prefer it, letting you know about the issues that might affect your pick-up or delivery, and also offering alternatives when solutions are needed. They keep your freight and your best interests at the forefront of every conversation and interaction.

Asset Based or Non-Asset Based
Another consideration when selecting an IMC is to weigh the importance of being an intermodal asset owner or a non-asset owner? While this is an item that certainly differentiates the IMC’s, this element should not be one of your main deciding factors on which IMC you select. There are several excellent IMCs that move a lot of volume on trains do not possess intermodal equipment. Being an asset based Intermodal Marketing Company will provide only a small amount of leverage on pricing. I have heard many asset based carriers make the sales pitch that their company is better than company “XYZ” because they own assets, thus they have the ability to guarantee equipment for all shipments. The downside is the asset based IMC is more concerned about “turn times” or “trips per month” on their assets than they are about providing good customer service to you. The IMC without assets in most cases has access to just as many intermodal containers (in some cases even more), but if solely focused on your needs and serving the best interest of your shipment rather than their equipment.  This is certainly an item that differentiates IMCs, but I feel it should be weighted very lightly when choosing the “best” intermodal marketing company for your needs.

All Aboard the Green Train
Issues are affecting our environment, the fact is not surprising anyone reading this blog. Chances are your company has even launched a “go green” initiative, whether it’s recycling office paper or joining the EPA’s Smartway Partnership. Moving your freight by train will result in a tremendous reduction in the carbon emissions into our atmosphere. When you are looking for the best intermodal provider, this is an item you should certainly consider. Are they a member of Smartway, do they have active programs in place to help the environment today and tomorrow?

Where Do You Rank?
Another element that certainly tells the story about an IMC is their current client base. Who do they currently do business with? Several IMCs tout that 80-85% of their volume and revenue comes from 10% of their customers. What this tells me is how much they like doing business with very large companies. Other IMCs prefer to do business with small to medium sized customers so their distribution of volume and revenues are spread over a much larger customer database. Typically the IMC catering to smaller clients has a natural knack for making the smallest customer feel just as important as their largest customer. Which type would you prefer to deal with? Who would you think values your business more?

Continuous Improvement
The final deciding factor on how to select your best intermodal marketing company involves the dreaded word “change”. There are many IMCs that are happy with the way things are now, while others are continually looking for ways to embrace change, either in processes or technologies. They’re doing this in order to improve how they are doing things for the betterment of the customers (for you)! I will certainly concede that change for the sake of change isn’t good, but change for improving service to the customer is something that differentiates a complacent intermodal provider from one striving to be the best.

It is my sincere hope that the list of items above will stimulate some thoughts for you the next time you need to move an intermodal shipment. No doubt you have noticed that I didn’t include much in my blog about price. Trust me, leave it on the bottom of your decision criteria and you will be able to select the best intermodal provider for your business needs without concentrating on price.

For more information on our intermodal division, connect with an expert today.