THE VALUE OF TRANSIT TIME IN INDUSTRIAL FREIGHT TRANSPORTATION IN NIGERIA

This study was an attempt to estimate the value of transit time in industrial freight transportation in Nigeria. It relates the values of transit time directly to two groups of industrial freight using economic arguments. For this purpose, the value of transit time was calculated as the ratio of freight charges and the transport service measure represented as transit time, standard deviation of transit time and reliability of delivery times. The approach enabled the interpretation of the values associated with industrial freight transit time as representing an interest rate inclusive of storage cost while the other values based on standard deviations of transit time represent the shipping firm's valuations of transport service over the entire duration of shipments. The results suggest that the value of transit time and the standard deviation of transit time varies substantially between the two groups of industrial freight, with the revealed values being, in general, higher for consumer goods than for capital goods. The findings have some usefulness in transport planning, when the revealed values are interpreted as transit time savings due to an improvement in freight transportation services.