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May 15

How to Optimize Rail Logistics for Your Supply Chain

Rail logistics is essential to many industries, including specialty oil suppliers like us and the customers we serve.

Our industry, and by extension, the industries we serve, depend on rail freight transportation for its cost-effectiveness and other benefits.

Rail has its limitations as well. But with an experienced and technology-enhanced approach to rail logistics, you can maximize the efficiency of rail in your supply chain.

Why Rail Logistics?

Here in North America, seven Class I railroads are in operation:

  • BNSF
  • Canadian National Railway
  • Canadian Pacific
  • CSX
  • Kansas City Southern
  • Norfolk Southern
  • Union Pacific

These are the major carriers of rail freight, and each has its own system for tracking the trains that keep the economies of the U.S. and Canada humming.

In addition, the U.S. network of railways is extended by 22 regional and 584 (local) short-line railroads, which stretch nearly 140,000 route miles.

Industries like ours need to navigate not one but all of these lines to get our products where they need to go. Rail logistics, the science of finding the most efficient route, is a simple enough concept.

But the actual practice of rail logistics makes the difference between rail freight transport as a net benefit to your business or a net liability.

Rail Pros and Cons

The business benefits of rail include:

  • Cost-effectiveness. Rail freight is generally less expensive than other modes of transportation, such as air or road freight, offering a typically lower cost per ton-mile vs. road or air freight.
  • Large capacity. Rail freight can transport a large number of goods over long distances. Trains carry thousands of tons of cargo, making rail an efficient option for transporting goods in bulk.

However, it has limits compared with other forms of transport:

  • Flexibility. Trains are limited to a fixed network of tracks and stations, which can make it difficult to transport goods to certain locations.
  • Limited speed. Rail freight is generally slower than other modes of transportation, such as air or road freight, and trains are limited to a fixed speed.
  • Weather dependence. Rail freight can be impacted by adverse weather conditions, such as snow, ice, or heavy rain, that other forms of freight can work through.

These limitations can be challenging for logistics professionals to overcome. Thankfully, modern technology can enhance our ability to optimize rail and maximize the benefits.

How to Optimize Rail Freight Transport

We leverage cutting-edge technology in rail logistics to keep rail freight transport as efficient and cost-effective as possible. It helps us optimize the supply chain in three key ways.

1. Access

Each Class I railroad has its own system for tracking the location of trains, anticipated departure and arrival times, etc. Our rail freight management partner seamlessly brings all this data together for us.

2. Responsiveness

With eyes on our rail tank cars at all times, we can easily see where lines are congested. This allows us to accurately communicate with our supply chain partners and make real-time adjustments to pickup times and locations.

3. Prevention

Historical data helps us predict issues that can arise at certain times, or on certain days or times of year. Forecasts allow us to anticipate issues and take necessary action, such as pre-loading, early delivery, and holding additional inventory at strategic locations.

But technology alone doesn’t ensure that your raw materials will arrive on time and on budget consistently. In rail logistics, experience—understanding the principles behind the technology and how to use it—is crucial.

Optimize Your Specialty Oil Supply Chain: Signal Fluid Solutions Rail Logistics

In addition to our truck trailer fleets, Signal Fluid Solutions routinely transports our premium specialty oil products by rail to keep your costs as competitive as possible.

It’s part of the strategic plan that has made us a recognized leader in specialty oil supply security:

  • Railcar fleets for cost-effective bulk shipments by rail tank car
  • Truck trailer fleets to supplement rail and deliver on time and on budget
  • Deliveries by drum, ISO tank, or Flexitank as required by our customers
  • Deep inventories at strategic locations throughout North America and Europe

Reach out to ask about our logistics services and the wide range of premium products we provide. We look forward to working with you to optimize your specialty oil supply chain!

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