Changing policy paradigms are pushing Indian logistics companies to rely heavily on multi-modal transportation for better business prospects. Though there are last mile connectivity issues especially for the air freight segment because of lack of hinterland connectivity in port freight that affects operations, but companies are ready to take the plunge in order to reduce the logistics cost and streamline the entire value chain, writes Prashant Bhatmule, Head Outsourcing, JK Paper Ltd.
Prashant Bhatmule
I was travelling to a new location around 3-4 years back and didn’t know relevant routes. While using Google, I was surprised to learn that the usage of multimodal transport is possible to this extent, leading not only cost optimization but also time optimization to the maximum. Of course, it goes without saying, the multimode acceptance is possible only with synchronization of various modes being used and the same is possible with discipline in all sectors. Today it has become a part of life for personal travel through Google Maps.
The Indian logistics industry spends around 13% of the GDP on different types of costs incurred in logistics operation. Logistics as a function is being increasingly outsourced by manufacturers even though the logistics spend is quite high in India compared to other countries. We are having the second largest spend in the logistics sector next to China. China’s spend is much higher compared to us.
However, the Indian logistics sector in many ways still lacks the global standards of performance. This is evident from the fact that India ranked as low as 44th among 160 countries in the World Bank International Logistics Performance Index. Adequate road and rail infrastructure are still required to support the growth as these are the two major modes of transportation available in the country.
Policy level changes are also necessary to turnaround other modes like inland waterways and coastal shipping. Investing in and using multiple transportation modes not only brings efficiencies in the chain but also goes a long way to reduce pilferage as well as overall transportation costs.
The transportation industry has changed a great deal over the years. While the evolution of the transportation industry has been difficult for many of those who work in the field to adjust to, it has been beneficial for businesses who have been able to greatly reduce their shipping and transport costs. Implementing new technological innovations is an expensive business. Reducing the costs of shipping and transport is clearly of great benefit to any business. Transportation costs represent an expense which cannot be eliminated entirely, but which can be dramatically reduced, not only by technology but also by using more efficient methods. One of the more efficient methods of transporting goods is to use Multimodal transportation, which involves combining different methods of transportation to reduce costs and to maximise the efficiency of operations.
Benefits
Businesses which have a large amount of material to transport on a regular basis can make considerable savings by choosing a multimodal transport procedure. Multimodal transport policies tend to be far more cost-effective. They also allow for cargo to be transported to and from areas that would otherwise present something of a logistical challenge. Not only this but by making more efficient transportation routes viable for all, multimodal transport can be considered much greener than other alternatives.
Trucking has traditionally been the most common means of transportation across the world. There are few professions or vocations which are as quintessentially Indian as trucking. However, conditions over the last decade or so have not been kind to truckers. Policies should have been introduced which restrict the number of hours that a trucker can be expected to work. This is on top of the challenges of having far fewer applicants for vacant driver positions and increases in fuel prices, both of which have proven to be existential threats to many existing companies.
The lower costs that result from using multimodal transport remains its biggest selling point. It is the ability to move large quantities of goods for relatively less money that makes the concept of multimodal transport so appealing and worth pursuing. Not only can multimodal transportation help to reduce the immediate shipping costs by defaulting to the best value option, it can also help reduce costs by other means. For example, the different shipping methods on offer mean that businesses have more flexibility and control over the loading and unloading processes. These reduced handling costs can then be passed on to the consumer.
In today’s climate, a business cannot be too environmentally friendly. Switching to a multimodal transport policy can dramatically reduce your business’s carbon footprint and the impact that it is having on the environment.
To understand just how much of a difference multimodal transport can make to the rate of greenhouse gas emissions that a business is responsible for, consider the example of a truck versus a train. A truck emits something in the region of 19.8 pounds of carbon dioxide for every 100 ton-mile that they travel. A train, on the other hand, emits a mere 5.4 pounds over the same distance. As one of the fresh initiatives by the Indian Government, Rail transport has been started from Kolad to Suratkal, which was a three day journey, reducing time to one day by carrying trucks on rail wagons.
Implementation
Even if your current shipping and transport routes really are best served by a single transportation method or route, it is still worth investigating the potential of multimodal transport. In making such an analysis, the first thing that you need to do is to establish the exact shipping routes. Work out what is being shipped, where it is coming from and where it’s going. As a general, although by no means all-encompassing, rule, it is the longest and most varied journeys that stand to benefit the most from going multimodal. When you think about it, this makes sense. The longer and more varied the terrain, the more transportation options there will be. Therefore, greater opportunities available for savings.
Once you have a detailed map of your current shipping and transportation routes, it is time to check how the rates for the various modes of transport compare. And this is nowadays easily available on various Vehicle tracker modules. Once you look at the different methods and pricing options, you may well be surprised at just how much variability there is. For many businesses, until they seriously investigate the possibility of multimodal transportation, they remain blissfully unaware of just how dramatic a difference it can make in determining the overall costs of transporting cargo.
The premise of multimodal transport, using different methods of transportation for different parts of the journey, can, in fact, have massive repercussions, especially in terms of affordability. When the principle of multimodal transport is fully embraced and pursued to its optimal conclusion, it can dramatically improve the efficiency that businesses operate at, while also greatly reducing the cost of shipping for consumers.
Restricting businesses to a single method of transportation means that they don’t have the flexibility and space that they need to formulate a more efficient and effective policy. As the options available to businesses looking to transport cargo expand, multimodal transport becomes an increasingly attractive way of doing things.
Management and Challenges Ahead
Multi–modal Transport System is fragmented due to
> Multiple agencies
> Multiple jurisdictions
> Multiple modes, and
> Multiple disciplines being responsible for various aspects.
Hence integrated, well designed and co-ordinated Multi–Modal Transport System (MMTS) is required. Having said that, management of system integration is one of the challenging tasks for MMTS. System integration has three levels viz., institutional, operational, and physical.
i. Institutional integration is an organizational framework in which joint planning and peration of transit services are carried out.
ii.Operational integration involves the application of management techniques to optimize the allocation of transit resources and to coordinate services. The techniques of operational integration are elimination of wasteful duplication of transit service by competing systems, higher utilization of capacity, long haul modes on high density corridors, establishment of unified fare structure, subsidy in freight, verification of bookings of different cargo and coordination of public information system.
iii. Physical integration is the provision of jointly used facilities and equipment. Techniques of physical integration are inter-modal transfer, provision of weather protection structures at stops/stations/transfer points, provision of symbols and display techniques, provision of parking facilities and comfort and safety of pedestrian movements.
MMTS is a composite system and management of transfer time, waiting time, seamless travel, etc., are top priorities. The business satisfaction is possible only when proper integration of different modes is provided with minimum waiting time at stops/stations during peak hours. The various aspects of modal integration in terms of connectivity, uni.ed freight system, information integration, physical integration, network integration, etc., require proper planning and highly skilled management techniques.
Connectivity: The two ways mass transfer of cargo from road-based transit to rail-based transit are possible only if the connections between truck station and railway stations are available through feeder services.
Unified freight system: A single freight system can be a unique advantage for a cargo to reach from origin to destination. It reduces the travel time from origin to destination. The single freight system attracts customer to use buses, train, flights, etc., because of the comfort and also saving time in buying separate bookings for transport of goods.
Information integration: A common guide booklet with complete information regarding various services should be available to a business at every major transfer location. The information should be properly advertised through various information agencies, radio, TV, etc.
Physical integration: Adequate space needs to be provided at the ground for interchange facilities around stops and stations for smooth transfer of cargos from di¬erent travel modes via route to destination. Park-n-Ride facilities need to be provided at various stations to promote the transit rider for parking of personalized vehicles to further economize.
Network integration: Restructuring of routes to reduce wasteful duplication of services between truck routes and railways, or sea transport, etc., are essential at network level. The surplus can be utilized for feeder services to other stations.
Hi-tech surveillance and management of development along MMTS corridors having influence zone of 500 mt wide belt on both sides must be planned as intensive development zone and accordingly development control norms must be formulated. It is important to integrate these places of importance and connect through proper development of MMTS corridors for smooth and convenient movements. A well-developed multimodal transportation system uses maximum application of ITS.
Management of Intermediate Paratransit (IPT), Non-motorized Vehicles (NMVs) and their parking areas near MMT stations are a challenging task. The planning response to NMVs is closely associated with the delivery mechanism of urban basic services to the growing number of inhabitants by the urban local bodies. It follows that urban services and activity centres need to be distributed in conformity with the characteristics of these modes in both new settlements and in the redevelopment of the older part of the existing cities along MMTS corridors.
The security of massive capital intensive projects like MMTS need special provisions of safety and security both at the stations and routes. Transport Security sometimes called transit security, is a scienti.c method of understanding realistic adversaries and designing systems to prevent them from doing harm. The aim of designing the system is to prevent, protect, prepare and to implement a recovery mechanism. However, fiscal base of transport security should support the cost of security measures and consequences of security failures. Hence a separate “Transport Security Regulatory Authority” must be created to bear responsibility and costs for carrying out security measures.
Expertise is the key
Multi–modal Transport System (MMTS) explores the use of multiple modes of transport for safe, convenient and efficient movement of cargo. Generally, MMTS has been characterized essentially by increased capacity, efficient access and better location of both interchange and integration nodes. Additionally, presence of MMTS in metro region enhances accessibility, economic growth, public health, environmental protection, security & safety, social cohesion, etc. In this connection, it is desirable to establish a single authority for planning, development, implementation and enforcement of the policies.
Multimodal transportation system demands better synchronization among various modes of transport for better, advanced and efficient service. Further, it requires need based traffic circulation plans to integrate various modes and improvement of major road stretches and intersections to facilitate smooth movements. Hence, management of such mega projects requires expertise of both traffic engineering and transport planning.
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