While shipments are always scheduled, delays are inevitable making the estimated time of arrival or an ETA is an educated guess, in most cases, as to when the package will arrive at its destination, through whatever means of transportation is used.
Knowing your freight’s estimated time of arrival is crucial for the logistics and supply chain management industries. In addition to keeping the supply chain moving smoothly, it allows for better communication and expectation management for end customers. Shippers rely on ETAs to ensure that deliveries are on time and aren’t stuck in a port threatening to rack up detention and demurrage charges. Manufacturers require ETAs to avoid stock-outs, which brings production lines to a screeching halt.
What is the Difference Between an ETA and an ETD?
An ETA simply refers to the arrival of the chosen means of transportation (ship in the port, train at the depot, etc.), whether for loading up a shipment for transport or unloading a delivery.
ETD, on the other hand, is commonly used for one of two meanings.
- Estimated time of delivery – The shipment is being delivered to a consignee at that time.
- Estimated time of departure – the mode of transportation is leaving the point of origin at that time.
Variables to Consider when Calculating ETAs
Determining the estimated time of arrival can be challenging as there are several variables to consider. Road transportation is among the most complex compared to rail or air, as there are significantly more uncertainties involved. Mechanical failure, accidents, traffic, and construction all play a role when determining the ETA of road-bound freight.
Ocean freight has its own set of complications when calculating ETAs. Here, most delays happen at the port terminal, rather than during transit, although currents and winds can certainly affect travel times. More often than not, however, it’s the processing freight, be it through customs, lack of berths, technical difficulties at the port, or unsafe weather conditions that genuinely affect the ETA of ocean freight.
What can a Shipper do with an ETA?
Knowing when a shipment is supposed to arrive, combined with visibility into the supply chain and potential delays, means the ability to give customers advance notice of a possible delay. Proactive measures can be taken accordingly, which reduces the overall negative impact on the customer, which raises the levels of customer satisfaction and continued business.
For example, In terms of the number of changes to delivery dates (ETA), the Trans-Pacific trade lanes showed the largest increase from 1.67 changes per shipment in January 2020 to 3.93 by January this year. While European cargo ETA changes per shipment averaged 1.41 in January 2020 they increased to 3.13 a year later.
Both trades have seen a doubling of the number of shipments that have had changes made to their delivery dates. This means that the risk of disruptions and poor service has also doubled. That also means that the opportunities to provide better service and utilizing ETA information have also increased.
The key to those opportunities is that ETAs need to be continuously updated based on real-time location data. Real-time ETAs can take your supply chain to the next level, allowing you to shift from reactive to proactive, and finally to predictive.
- Reactive: Based on standard visibility, information on goods’ location is manually entered or transmitted via EDI at regular intervals. Due to the processing time of EDIs, this information is already past its prime by the time it is human readable.
- Proactive: Based on real-time location, information captured via API or another software system provides live location information on freight at that current moment. The data is reliable and provides opportunities for performance analysis after the delivery has been completed.
- Predictive: Based on real-time location plus supply chain visibility is the pinnacle of supply chain capabilities. Real-time location information is cross-checked with previously collected data such as heavy port traffic or a weather forecast. The shipper can alert their customers hours or possibly days in advance of a potential delay.
This, in itself, is an incredible opportunity for enhancing supply chain performance, but ETAs are capable of even more.
ETAs add Value to the Organization
With accurate ETAs, organizations can reduce their administration costs by automating specific processes that allow their teams to focus on exceptions. This means that shippers can better utilize key personnel for value-added tasks instead of mundane and tedious functions such as calling carriers for follow-ups on freight locations, sending delivery notifications, and scheduling docks.
Delays cause ripples throughout the entire supply chain. The most obviously affected party is the end-customer who is waiting for finished goods. However, a delay can slow down production, warehouse teams, and distribution centers. Accurate ETAs reduce the potential for disruption overall and allow these teams to make adjustments as needed to keep things in motion.
Real-time ETAs also allow for greater cooperation with their carriers and better visibility into their operations. This transparency ensures that freight costs are fair and reasonable, especially when it comes to unexpected costs. Conversely, carriers can also benefit from advance notice if a shipment is delayed. It reduces their dwell time and allows them to change their operations to better utilize their fleet and available resources.
How Ocean Insights can Help
Having an accurate ETA can make all the difference when it comes to running a successful business. At Ocean Insights, we firmly believe that ETA data is essential and have focused on making this information as accurate and close to real time as possible. Our predictive system allows our customers to move from a reactive mode, to a proactive mode.
Get a real-time view of the possible delays facing your shipments
The predictive nature of our system is that we rely on historical routing data, current schedules, real-time status information about the vessel and external factors including:
- Port Strikes
- Major Weather
- Port Congestion
- Vessel Damage
- Major Weather Events
In some cases, it’s not always possible to predict a specific time of arrival, such as instances of port strikes or vessel damage. But we can with 100% certainty tell you when a container will be late, which is still incredibly valuable and useful information.
We also believe that having the ability to compare two data sets is the best way to hold your carrier responsible, so we always display our predicted ETA next to the carrier’s reported ETA to provide a reference point when deciding which carrier to use when booking your freight.
To learn more about our predictive ETA system and what it can do for your business, be sure to download our free brochure today.