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Warehousing & Fulfillment

What is Time in Transit?: How to Calculate UPS Time in Transit Costs

Warehousing & Fulfillment
September 29, 2021
11 min read
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This straightforward guide contains everything you need to know about UPS shipping zones and time in transit to make more strategic decisions about your supply chain.

What is Time in Transit (TNT)?

Time in transit is the time it takes for a shipment to be transported and delivered once it has been picked up from the point of departure. Basically, it is the amount of time spent shipping and delivering products from a merchant’s warehouse to the consumer.

Time in transit can vary according to the shipping route or to the mode of transportation used. For example, transit times for next-day air shipments and ground transportation can vary enormously. Most shipping carriers measure time in transit by hours and days. These measurements are often available for consumers when buying products from merchants that offer last mile carrier tracking for online purchases.

Time in transit considerations should also include the time it takes to get products from the port to the warehouse. In 2021, international port delays have increasingly impacted companies trying to get their products from the ports to their distribution centers, extending time in transit of imported products by up to two months. While there are many factors that may affect freight transit time, including the time it takes to get your products into the warehouse in your time in transit calculations keeps your supply chain operations running optimally.

How Does Reducing Time in Transit  Affect Your Business

Calculating UPS time in transit can be incredibly beneficial for small to mid-sized businesses. Some SMB’s may be surprised to learn how high their transit times are and should find efficiencies in their supply chain to lower them for two very important benefits to their business:

  1. Lowering time in transit for final mile delivery helps merchants get shipments to end customers faster, which creates greater customer satisfaction and a higher chance of repeat customers.
  2. Lowering time in transit also creates a more efficient process for shipping products to end customers, which also helps to lower shipping costs. The longer an item is on a delivery truck, the more final mile delivery is going to cost.

Environmental Considerations of Time in Transit

Another important factor when considering time in transit is the environmental sustainability of your business model. Lowering time in transit not only reduces merchants’ shipping costs and improves their bottom line, but also reduces the costly environmental impact caused by inefficient delivery. The less time it takes for merchants to ship their products to consumers, the lower the carbon footprint of deliveries. Because the transportation sector is the largest contributor to greenhouse gas emissions in the United States, lowering time in transit for final mile delivery means less time on the truck and fewer carbon emissions. Air shipments also emit nearly 6 times more carbon than ground shipments.

With this statistic in mind, it’s important that merchants attempt to reduce their reliance on air shipments as much as possible by optimizing shipping zones for more efficient ground delivery. Consumers also value sustainable shipping options. Our 2021 consumer survey revealed that 88% of consumers say that sustainability is important to their online shopping decisions, and 41% said that eco-friendly shipping options was one of their top concerns.

The Importance of Time in Transit and Consumer Expectation

Technological advancements in the fulfillment and logistics industry offer eCommerce merchants valuable opportunities to reach their customers faster and more efficiently while also meeting the increased demand for products that match up with consumers’ environmental values. According to a consumer survey by Shopify, while 49% of consumers are willing to pay extra for a sustainable shipping method, they are also more likely to opt for a same-day or next-day shipping option when available. Even though consumers want to make the eco-friendly choice, they are often programmed to make the convenient choice if offered to them.

The cognitive dissonance caused by modern day shopping habits and the increased demand for 1- to 2- day home delivery options requires that merchants find a way to marry convenience and sustainability through their business model. By using a logistics solution that strategically stocks products closer to customers, merchants not only lower the time in transit of ground shipments, but also reduce the environmental impact of next-day air shipments.

To help merchants take their sustainability initiatives even further, Ware2Go’s logistics experts have created a fully-funded carbon offset program to help neutralize the carbon output from shipping and delivery. After determining the amount of monthly carbon emissions of all shipments across Ware2Go’s network, our team purchases the equivalent amount of carbon credits to be put towards reforestation and forest preservation projects, which draw down a comparable amount of CO2 back from the atmosphere.

Through Ware2Go’s partnership with Pachama, our merchants become part of the mission to restore vital ecosystems, prevent deforestation, and create sustainable forests. As a result, merchants partnering with Ware2Go receive the best of both worlds – lower time in transit costs, increased satisfaction of customers through their product’s convenience of delivery, and a greater peace of mind knowing that their shipping is more sustainable.

Learn How to Calculate Time in Transit through Shipping Zones

What are shipping Zones?

To calculate the time in transit of a shipment, it is important to know what shipping zones are and how they play a key role in how quickly an order can reach its destination. A shipping zone is a geographic region to which carriers deliver goods and is categorized by a grouping of zip codes. 

Shipping zones are often measured and assigned by the distance between a shipment’s point of origin and its final destination. In the United States, domestic shipping zones span between Zone 1 (between 0-15 mile distance) and Zone 8 (a distance of 1,801 miles or more).

How to Calculate Shipping Zones & Time in Transit

Most shipping carriers, such as UPS, determine shipping zones by measuring the distance that a shipment travels and by determining where the package is shipped from. If two packages are shipped to the same location but are sent from two different warehouses, there is a possibility that they could have different shipping zones. 

UPS calculates shipping zones based on the distance a package travels, using the first three digits of the shipping item’s origin and destination zip codes. This is because the first three digits of each zip code indicate a shipment’s approximate location, allowing postal services to more accurately determine the item’s origin, delivery location, and the correct time in transit. For instance, a shipment traveling from Atlanta, GA to Columbus, GA (within the same state) would have zip code prefixes of 303- and 319- and, therefore, would be calculated as Zone 1.  

With that said, the further the distance, the more expensive the shipping and the higher the zone number number will be until it reaches Zone 8. Therefore, it’s important that merchants and businesses work towards designing a logistics model that lowers the distance and time it takes to deliver a package. Not only does this lower the cost of shipping, but it also helps to drive business and keep customers, as higher shipping costs can often discourage customers from placing orders in the first place and lower shipping costs reduces the rate of shopping cart abandonment

How to Reduce Shipping Transit Times

  • Design a Warehouse Network that Gets You Closer to Customers. The proximity of your inventory to your end customer is one of the most important factors in determining the cost and speed of shipping. Since affordable and fast delivery is important to consumers, optimizing your warehouse networks based on  your product’s end destination will help you reach your customers in the most cost-efficient manner. SMBs can identify optimal warehouse placements to ship domestically, allowing them to distribute inventory to multiple locations and optimize their proximity to customers to quickly and affordably ship to them. By storing inventory closer to customers, merchants can eliminate higher shipping zones, reduce shipping costs, and improve speed of delivery.

  • Integrate the Right Technology to Optimize Your FulfillmentOptimizing your fulfillment operations also means implementing the right software to seamlessly integrate with different online marketplaces and ecommerce platforms. By applying the right eCommerce technology, merchants are able to manage and automate order fulfillment across multiple channels and warehouses within their network. Ware2Go’s Warehouse management platform, NetworkVu, allows merchants to optimize the speed of their fulfillment operation through having visibility of inbound deliveries, inventory levels, and outbound shipping performance. NetworkVu also uses machine learning algorithms to get smarter as merchants use our technology. By learning more about merchant’s unique shipping patterns over time, NetworkVu offers progressively better recommendations to ensure that all fulfillment processes in the warehouse are moving as efficiently as possible, helping our merchants reduce costs and increase customer satisfaction. 

  • Partner with Third Party Logistics Providers (3PLs) or a Fourth Party Logistics Provider (4PL) to Access Economies of Scale. While small to medium sized businesses may understand the importance of reducing time in transit, it is often too costly to justify implementing insourced warehouses. The solution is to partner with a tech-enabled logistics network, like Ware2Go, which enables SMB’s to optimize their supply chain planning and find prime warehouse locations that allow for fast delivery to customers. Investing in a 4PL provider and outsourcing fulfillment service allows merchants to easily reduce shipping costs, access the latest technology and transportation, and take advantage of economies of scale. As a result, small businesses can start offering 1- to 2-day delivery, decreased transit time for shipments, and reduced shipping and environmental costs.

Next Steps For Optimizing Your Product’s Time In Transit 

Reducing time in transit has become a vital strategy for eCommerce fulfillment. In 2021, 4PL services, like Ware2Go, help small to medium businesses of different sizes and industries calculate and minimize their time in transit costs so that merchants can afford to offer customers positive delivery experiences, such as guaranteed 1- to 2-day shipping.

Contact Ware2Go’s supply chain experts for a free consultation to get the best advice for optimizing transit costs. By partnering with the 4PL service like Ware2Go, you could save a significant amount on shipping expenses while still offering free nationwide 1- to 2-day shipping.

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