Transit time, or the amount of time taken for goods to get from one destination to another is hugely significant in a company’s overall supply chain management process. In some instances, depending on the type of commodity being transported, the length of transit time can also impact the overall wellbeing of the cargo itself.
Measured in hours or days, transit time is the length of time cargo takes to get from point A to point B. The mode of transport varies depending on the goods and can include multiple delivery methods, including a ship, plane, train, and truck.
Transit time can be broken down into transit days, which include the time taken to move cargo from the supplier’s warehouse to the port of origin, any storage days used, sailing time, and the time taken to discharge the cargo at the destination port, ready for customs clearance. The number of days needed for the customs clearance of goods and their delivery to the customer’s premises are counted as clearance and delivery days (CDD).
Transit time is an important component of lead time, which is the total time taken to realise a purchase order placed with a supplier. While shorter lead times are desirable, it can be challenging to get these from suppliers. However, longer lead times can limit supply chain responses to changing demand, variability, and uncertainties.
Having predictable transit times also contribute to cost management within shipping operations by reducing unnecessary expenses like inventory holding costs and optimising logistics processes.
Reliable transit times are also crucial for maintaining an efficient supply chain, by enabling companies to plan and coordinate their inventory, production, and distribution processes more effectively.
Much like with airplanes, ships will try to respect the schedules and keep to predicted transit times as much as possible. However, there are important factors that impact transit time, including:
Shipping companies may also adjust transit times in instances of sustainability. In some cases, carriers have reduced the speed of the vessel to protect an endangered species. Although the ship will take longer to reach the destination, the benefits for the environment are significant.
While transit time is undeniably important, there are cases where flexibility and forecast take priority. For example, if a clerical error occurs that means a container isn’t loaded onto the vessel, customers often appreciate the flexibility of moving the container to the next port by truck if possible.
Forecasting and preparing for possible delays is also very good practice. When shipping companies like MSC expect delays, they can add extra calls or extra vessels to a service in order to accommodate more volume. While there are some cases when it is unsafe to ship, such as during monsoon season, having flexibility within the shipping schedule enables as many challenges to be overcome as quickly and successfully as possible.