Trans-loading is the process of transferring a shipment from one mode of transportation to another. It is most commonly employed when one transport mode is not able to complete the whole trip required for successful delivery to the customer. The shipment is required to be offloaded from one transport mode like a truck to a plane or a train to a ship.
Similar to transshipment, trans-loading requires handling of the goods, so it has a higher risk of damage and loss. In Singapore, we have free trade zones where such operations are usually done to avoid the payment of taxes and duties. In order to minimize handling, we try to use containers for transport as well as storage if required. For shipments that are not able to load into containers, we would arrange connecting transport as close as possible to avoid additional costs due to storage. Storage facilities are available in event delays are inevitable.
Is Trans-loading different from transshipment?
Trans-loading is often confused with transshipment. Trans-loading concerns the mechanics of transport, while transshipment is addressing how the shipment originates and is destined. Generally, a shipment loaded in a container can be taken in one shipment to an intermediate point and then to its ultimate destination without ever leaving the container. If this is specified as two shipments, then the goods are transshipped, but no trans-loading has taken place. Trans-loading involves the offloading of the shipment from one container and loading of the same shipment into another container for onward transit to the ultimate destination.
Why trans-loading is used?
Consolidation for Buyer or Seller
When there are numerous orders from various suppliers, it makes a significant amount of cost saving when these small orders are combined into one big order. Similarly, if the seller is selling the same goods to a few buyers in the same region, it makes more sense to send a shipment as one load and distribute to the various buyers when shipment reached. With trans-loading being taken care of by a logistics provider, the buyer or seller can concentrate their time for other operations. However, it is important to note that trans-loading involves some risks such as damage and theft or additional delays to perform consolidation or deconsolidation, which may not be suitable for some supply chains.
Weight Compliance or Saving
At times, a shipment maybe overloaded in a container in terms of weight. Trans-loading is exercised to correct this weight compliance for the onward transit to the ultimate destination. It could also be that a shipment is not loaded properly and utilized 3 containers instead of the properly packed 2 containers. As such, trans-loading is to correct the packing and eventually bring about cost savings. The former to avoid penalties due to the weight as well as avoid the need for special lifting equipment. The latter to compact the shipment to avoid extra costs due to the under utilized container space.
The initial container or loading unit used for the shipment might not be approved for the next required journey. Most of the containers currently in circulation are leased containers and have specified locations that they can be used for. Trans-loading is thus performed to ensure that the leased container is handed back to the carrier without additional charge. Trans-loading also enables a more efficient use of container assets and can facilitate international trade by freeing transport capacity. This way, there would not be a high concentration of containers in any location.
Supply Chain Management
With trans-loading facility as a buffer within a supply chain, sellers are able to combine various orders for the same buyer. With the short break in the transit, the seller is able to last minute decisions about routing freight to the final destination or even change the transport mode to get more cost savings.