Why Shipping Delays Occur & How to Improve ETAs
“Visibility is critical to the supply chain. Knowing your shipment is delayed is a necessity, but knowing why your shipment was delayed further empowers customers to take action, save costs, and minimize the business impact of delays,” according to Ami Daniel, CEO and Co-Founder of Windward.
The good news is that shipping delays seem to be decreasing dramatically in 2023. According to a recent survey, only 21% of customers reported experiencing delays, a significant reduction compared to 53% in 2021. But these numbers can quickly rise again. Shippers must recognize these delays as early as possible and update clients to manage consumer expectations.
Container Shipping Delays in 2023 and Beyond
The shipping industry seems to have mostly recovered from slowdowns caused by the COVID-19 pandemic and the Russian invasion of Ukraine. But, as things return to normal, shippers can still expect delays due to traditional causes, such as transshipment, labor delays, and late departures.
According to a recent study, approximately 90% of global trade is conducted by sea. With over 5,000 ships transporting more than 34 million containers (TEU), the odds of delays are high..
Looking ahead to the second half of 2023 and then 2024, shipping container delays are expected to increase due to growing demand. The container fleet is expected to grow up to 8.1% by the end of 2024. This increased activity will result in port congestion, and when combined with regulations to slow down sailing speeds, shipping delays can be expected.
What Causes Shipping Delays?
Shipping delays are a common part of the shipping process. Significant delays can cause friction between stakeholders, negatively affect customer relations, and result in financial damage. Understanding the reasons for delays helps businesses stay one step ahead and inform customers, to avoid unpleasantness.
- Late departures: Windward’s insights show that 8% of delays are caused by the vessel’s inability to leave the port of loading (POL) at the time it was scheduled. It should be noted that the late departure, in this case, does not include those happening at a transshipment port, as that would be considered a transshipment delay. Late departures may result from various factors, such as equipment malfunctions, documentation issues, or unexpected port congestion. To minimize the impact of late departures, businesses should proactively monitor shipping schedules and coordinate with carriers to address any potential issues.
- Transshipment delays: delays caused during the transfer of containers between vessels can affect 1 in every 10 vessels (according to Windward’s AI-powered insights), significantly impacting shipping times. These delays can occur due to various complications, such as logistical issues, mechanical failures, or insufficient port resources. Businesses can minimize transshipment delays by working closely with their carriers and staying informed about potential issues.
- Rollovers: rollovers account for 19% of all delays. This means that the container failed to be loaded onto the vessel that was scheduled to transport it out of the transshipment port (TSP) or POL. Possible events leading to such a delay include:
- Carriers overbooking space on the vessel scheduled to transport a container, leading to the inability to load it onto that vessel due to lack of space or excess weight
- Unplanned rerouting of the allocated vessel
- Technical issues that make the planned vessel unfit for sailing.
- Delivery of the container to the POL after the cut-off date
- Global emergencies: events such as pandemics, wars, and natural disasters can significantly disrupt shipping processes, making it difficult to predict or control the resulting supply chain delays. These emergencies can lead to billions of dollars in losses for businesses and restrict access to vital ports or transportation routes. The unpredictable nature of these events makes it crucial for businesses to develop contingency plans and adapt their supply chain strategies accordingly.
- Weather anomalies: severe weather conditions and natural disasters can directly impact transportation processes, causing delays in shipments at air, sea, and ground levels. Unpredictable events, such as hurricanes, earthquakes, and floods, can lead to long-lasting delays and significant damage to infrastructure. Organizations should monitor weather forecasts and adjust their shipping schedules and routes to minimize potential disruptions.
- Labor issues: strikes, workforce shortages, and other labor-related problems can have a significant impact on shipping times, particularly in industries that rely heavily on manual labor. The shipping industry depends on individuals to pick and pack orders, load and unload packages, sort them, and transport them to their destinations. Addressing labor concerns and ensuring fair working conditions can help mitigate the risk of shipping delays caused by labor issues.
Accurate ETAs & Understanding the Reason for Shipping Delays
Whatever the cause of shipping container delays, it’s essential to keep everyone updated on the shipment’s status. One of the main difficulties in predicting shipment ETAs is the need to consider more than just the ship carrying the container.
Clear visibility of the global container vessel fleet is crucial because the vessels involved in a shipment aren’t the only ones on the ocean. Just like estimating wait time in a restaurant line requires knowing how many people are waiting, a solution aiming to predict a vessel’s accurate ETA needs comprehensive visibility of all other vessels and their ETAs to determine when the vessel will secure its berth slot.
A powerful AI solution, such as Windward Ocean Freight Visibility, offers the most accurate ETA predictions with its Maritime AI™ Predicted ETAs, calculated by fusing a multitude of relevant datasets and running them through machine learning models. Windward Ocean Freight Visibility users can answer the unavoidable follow-up question to any delay update – “Why?” These exclusive insights are available via an easy-to-integrate API, our web application, and our daily status update emails.
As mentioned in our previous blog post, “Supply chain professionals can finally leverage these unique insights and utilize this actionable visibility to make better-informed decisions based on facts, such as assessing the performances of carriers, terminals, and ports, and providing accurate updates for stakeholders in real-time.”