DEFINITION of 'Transloading'

Transferring goods from one mode of transportation to another in order to have the goods reach their final destination. Transloading is used when it is not physically possible or is not economically efficient to transport goods to a final destination using only one method of transit. Companies that ship their goods internationally are likely to use multiple methods of transport, especially if both the shipping point and the destination are located inland.

BREAKING DOWN 'Transloading'

International trade and globalization has led many manufacturers and retailers to ship their products all around the world, a feat that takes goods thousands of miles across highways, rivers, and oceans.

The efficiency of transloading increased dramatically with the rise of containerization and the intermodal container. The use of standard-sized shipping containers allows companies to load a container with its goods onto a semi-trailer at the factory, offload the packed container at the shipyard via a crane, and have the container placed directly on the ship. Containerization has become so important that ships are now purpose-built, with giant container ships plying the world’s shipping lanes.

The modes of transportation a company chooses depends on a variety of factors, including how quickly a good must arrive at its final destination, whether the good is perishable, the volume of goods being shipped, and the location of the final destination itself. Shipping coal from the United States to China, for example, may involve trucks and trains transporting the coal to shipyards, while transporting sushi-grade tuna may involve driving a truck to an airport so that it arrives at its destination quickly.

In general, trains and ships are the most economically efficient transport methods for most goods. Large trucks can be used to transport goods from ports or rail depots, while smaller trucks can be used for delivery to final destinations that are not located at the depots.

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