As companies expand their operations globally, they must carefully analyze transportation costs and their effects on inventory investment. To avoid merely focusing on freight costs, a comprehensive decision-making methodology is necessary, considering all related expenses. This article presents a modal choice framework that evaluates annual costs and long-term inventory needs to determine the optimal transport mode, including mixed strategies like ocean and air freight. A case study illustrates how a Fortune 100 company found that ocean freight was cost-effective for some products, while air freight was better for others.

Source: https://www.scmr.com/article/integrating-inventory-into-air-vs-ocean-international-transportation-modal-choice-strategies