What is ETA?
ETA, also known as Estimated Time of Arrival, refers to the approximate time in which a vessel is expected to arrive at the destination port. It is a crucial component of the logistics industry, as it allows shippers, carriers, and port operators to plan and coordinate their activities. It ensures the timely delivery of packages and uses the available resources efficiently. Calculating an accurate ETA is necessary to increase shipping organizations’ productivity, efficiency, and profits.
It is easier to calculate the estimated time of arrival using the right technical tools. ETA boosts the overall supply chain operations, identifies obstacles, optimizes schedules, and obtains data-driven insights for better supply chain planning. It keeps all stakeholders informed about the movements of goods and allows them to prepare for receiving the shipment. It is a vital metric to measure performance and time.
Factors Affecting ETA
ETA is commonly used in ocean carriers. It is crucial for planning and arranging service and equipment for the port. Some factors on which ETA depends are:
- Cargo operation time
- Vessel’s schedule
- Traffic congestion at the port
- Labor availability at the port
- Weather conditions
- Route distance between source and destination ports
- Time required for ship maintenance and bunkering
- Types of goods being transported
- Type of logistics service provider and travel time
- Piracy prone areas
How to Calculate ETA?
The estimated time of arrival is crucial for arranging service and goods, equipment for port operations, and cargo operations. It is calculated considering all the factors discussed above. It can be calculated as:
ETA = Estimated time of departure (ETD) + Estimated time in transit
Or, ETA = Total distance/ Vehicle speed
Let’s take an example to develop a deep understanding of ETA. Suppose parcel X needs to be shipped from Delhi to Lucknow on November 10 at 2 p.m. via road transportation. The speed of the truck is 50 km/h, and the total distance covered is 1000 km. Now the estimated time of arrival can be calculated as:
ETA = Total distance traveled/ Vehicle speed
i.e. 1000/50 = 20 hours.
Hence, the shipment will reach the warehouse after 20 hours. With the prior calculation of ETA, warehouse managers can arrange equipment for loading and unloading, paperwork, storage space, and quality inspection on time.
Benefits of ETA
ETA helps to maintain and improve customer satisfaction. If there is any delay in shipment, the clients must be notified so that they can take necessary actions that won’t affect the business. Some other benefits of ETA are:
- Optimizes Port Operations: Accurate ETA helps in port operations optimization. By knowing when a shipment will arrive, resources can be allocated efficiently, like cranes, labor, and storage space, to ensure smooth and timely handling of a vessel’s cargo.
- Streamlines Logistics Planning: By knowing the estimated time of arrival, shippers and carriers can easily plan their logistics operations, like loading and unloading cargo, customs clearance, and other shipment-related paperwork. It ensures packages are delivered on time and reduces costly delays.
- Improve Supply Chain Visibility: It helps stakeholders update real-time information about the vehicle’s location, speed, and direction of travel. This enables shippers to track the shipping goods and manage inventory levels more efficiently.
- Enhance Shipper-Customer Relation: It allows the shippers to inform the clients when their goods will be delivered. It is the key to customer satisfaction. It helps to build trust, and loyalty and enhance the overall customer experience.
Challenges in ETA Management
Below are some common challenges in managing ETA:
- Transshipments Delay: Transshipments refer to the containers that are transferred from one ship to another. Coordinating this transfer in a crowded port can be a complex logistics process. Hence, it causes delays in shipments.
- Late Departure: ETA depends on the estimated time of departure. If there is a delay in the ETD of the shipment, it will impact the ETA too. Also, if the vessel leaves the port of loading later than expected, it will cause shipment delays.
- Container Rollover: If ETA is not calculated properly, it leads to a situation where containers are ready to be placed but no free ship is available.
- No Vessel Allocation: Sometimes there may be situations where no vessel has been allocated to load containers at the transshipment port; this will surely delay delivery.
- Unfeasible Journey: Due to bad weather conditions, the journey becomes infeasible and creates a delay in the estimated time of arrival.
- Short Transshipment Buffer: Since transshipment windows are too small, there is always a risk of the shipment needing to be completed or rescheduled.
Moreover, lack of standardization and poor communication also influence the accuracy of ETA.
In summary, ETA is essential for both shippers and customers. It controls the entire shipment flow. It is the key to customer satisfaction. Calculating an accurate ETA is necessary to increase shipping organizations’ productivity, efficiency, and profits. The estimated time of arrival not only forecasts the tentative time of delivery but also how logistics companies can gain an advantage over other competitors and enhance sales.