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CEVA LOGISTICS ADDS SUSTAINABLE AIR TRANSPORT TO LOGISTICS SOLUTIONS

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Air Cargo, Archives, Global Logistics, Global Trade Daily

CEVA LOGISTICS ADDS SUSTAINABLE AIR TRANSPORT TO LOGISTICS SOLUTIONS

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Sustainability continues to underscore operations and initiatives in logistics. Last year, the industry saw even more attention on reducing carbon emissions, specifically for airfreight transportation–from commercial airliners to leading logistics companies. As seen with the maritime industry with IMO 2020, reducing the overall carbon footprint is the primary goal, but the logistics industry is taking a piecemeal approach to cover all bases. Notable companies linking arms to fight the issue of carbon emissions in the airfreight logistics sector include DHL, Yusen Logistics, Bollore Logistics and, of course, CEVA Logistics. In April 2021, CEVA Logistics announced its position on the issue through the joining of United Airlines’ Eco-Skies Alliance as an official partner (along with the other aforementioned companies). 

Known for being the world’s leading supply chain management organization headquartered in Marseille, France, CEVA is no stranger to stepping up in the name of sustainability. As part of parent company CMA CGM Group’s mission, CEVA is committed to acting for people, the planet and responsible trade–and that’s exactly what the logistics company is accomplishing through initiatives such as switching to sustainable aviation fuel (SAF), for example. Not only does this move support the Group’s mission, but it also supports collaboration along the supply chain. 

“One long-term benefit and advantage of SAF is that it is a concrete opportunity for shippers, freight forwarders and carriers to work together to improve the air freight industry,” explains Peter Penseel, chief operating officer of Air Freight at CEVA Logistics. “This type of collaboration can extend beyond SAF and environmental topics to ones like safety. As an example, we were recently the first company to receive IATA’s new CEIV Lithium Certification for the safe air transport of lithium batteries, so we’re encouraging other industry participants, whether freight forwarders, ground handlers, or carriers, to support this important safety topic as well.”

The leaders behind the CEVA mission capitalize on what can be done now to reduce problems for the future. This proactive approach differentiates the business from competitors while creating a competitive advantage for customers. This serves as a primary driver behind the CMA CGM Group’s goal of becoming carbon neutral by 2050.

“The Group aims at becoming carbon-neutral by 2050 and is significantly investing in research and development to help the emergence of future energy sources and technologies to reduce the impact of transport and logistics on the planet,” Penseel adds. “Encouraging the use of SAF in air transport is a direct outflow of this corporate commitment. Whether or not SAF is the long-term answer in air freight logistics, CEVA is taking tangible action today, with an eye on the solutions of tomorrow.”

What some logistics organizations might misunderstand that CEVA does not is the critical blending of customer needs and environmental needs. And in the modern world, it seems all players in the logistics arena are feeling the pressure to support sustainability more now than ever.

“Reducing emissions in the supply chain requires alignment with customers,” said Penseel. “We work alongside them to offer and encourage the right products and services, including alternative fuel options. We must embark on this journey together with a common vision and roadmap. To that end, we are a part of the Sustainable Air Freight Alliance (SAFA), which advocates for responsible transportation. The organization is made up of shipping companies, airlines and freight forwarders that are committed to measuring and reducing their carbon dioxide emissions.”

These changes do not come without their own set of unique challenges, however. Penseel adds that the current infrastructure landscape poses specific roadblocks that could potentially impede progress in the pursuit of carbon neutrality, warning that careful planning and collaboration along each step of the shipping process is critical and shouldn’t be compromised. 

“As an air freight industry, we need to be conscious of the production and infrastructure capacities for SAF,” he says. “As we ramp up the use of this alternative fuel, we need to ensure that we can deliver on our commitments. If the industry offers more SAF options, we need to work closely with the entire upstream environment to ensure the needed supply and infrastructure will be there to meet the demand we as an industry are creating.

“Estimating carbon footprint and planning accordingly is the first step toward a more sustainable supply chain. For example, we offer an eco-calculator on our website and through our MyCEVA digital booking platform to estimate the logistics carbon footprint of a shipment via ocean, air, or ground.”

Looking to the future, CEVA has more carbon-neutral tricks up its sleeve. Penseel confirmed the organization is currently discussing additional SAF options and programs with numerous air carriers to confront and resolve near-term environmental concerns. 

2022 has officially greeted the industry with CEVA taking it by the horns with customer and environmental needs at the forefront of its dedicated solutions. The organization capped off 2021 with its latest acquisition of Ingram Micro’s Commerce & Lifestyle Services business, representing another feather in the CMA CGM Group’s hat in the ecommerce planning and omnichannel sectors, further positioning them as leaders in all things shipping and supporting the goal of becoming a name among the top five global third-party logistics players. 

“The acquisition of Ingram Micro CLS is strategic for the CMA CGM Group,” Rodolphe Saadé, chairman and CEO of the CMA CGM Group, said in a December release. “After completing its turnaround this year, our subsidiary CEVA Logistics will accelerate its development and join the world’s top four in contract logistics.”

Customers can continue to look forward to maximizing their opportunities in meeting their own customer needs while playing an active role in contributing to a cleaner, greener and more eco-friendly way of conducting business. 

“We look to help our customers make the best decisions when planning their logistics and freight transport operations to reduce environmental impact as they balance the business and timing needs of their supply chain processes and shipments,” Penseel concludes. 

To learn more about CEVA Logistics, please visit cevalogistics.com.

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Peter Penseel is chief operating officer at CEVA Logistics.

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Air Cargo, Archives, Global Logistics, Global Trade Daily

AIR PLAN MODE: REACT, ADAPT AND COLLABORATE TO MOVE FREIGHT BY PLANE

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When we think of the “future” in terms of the global supply chain, advanced technology and new forms of disruption are usually among the things international shippers are most concerned about. With 2021 at its end, the “future” is right around the corner. Meaning, what supply chain players do now (and what has been done thus far) will inevitably impact 2022 and beyond, and the more one understands this market’s evolving patterns, the more successful they will be in managing what is to come. 

Throughout the past year, the air freight market has seen various shifts, particularly with global capacity constraints, remnants from pandemic-driven disruptions, and an overall increase in demand. To fully understand the future of air freight, we must look at the big picture. To do this, BDP International’s VP of Global Airfreight, Patrick Olyhoeck, shares what global shippers can do to navigate 2022. 

The first shift is perspective. 

“Industry players can be more proactive by learning to fully understand industry challenges from a customer’s perspective to help them collaboratively overcome challenges,” Olyhoeck says. “The industry is impacted by factors including COVID-19 recoveries… and fundamentally, proactivity can only come from understanding key market challenges, thinking forward and engaging across stakeholders to find future solutions.”

He shares the following shifts are among the most significant currently being felt across the market:

-Impacts on capacity due to lower passenger numbers

-Impacts from the re-balancing of trade relations

-Impacts from the knock-on effect of capacity needs from ocean to air 

-National level challenges including HGV drivers in the UK impacting final the distribution of air cargo

Despite these shifts, in addition to the ones not yet seen or felt by the market, it is quite clear that some challenges are here to stay–pandemic or no pandemic.

“The basics of the market did not change,” Olyhoeck says. “Compare it with a soccer game, two decades ago. The speed of today’s game is enormous with real athletes on the pitch but still, you need to score to win the game–this is equal to our industry. Although regulations and customer needs are changing, we still move air cargo from A to B. The nature of air cargo remains focused on speed and safety to justify the choice.”

In addition to the evergreen nature of regulations and customer needs, Olyhoeck stated that global capacity constraints are expected to be felt for at least another season, and the key to managing this can be found in verticalization strategies. Limiting transport methods not only hurts your business but can be felt by your customer base as well. Maintaining reliable, transparent customer relationships is more critical now than ever before to remain competitive.

“Verticalization is the way to move forward where expertise and experience meet,” Olyhoeck says. “Digitalization will play a significant role. It is necessary to control your capacity to meet your customer expectations throughout the supply chain and therefore not limited to the airport-to-airport move only. From a company view, we need to stay resilient, embrace technology and keep pace with innovations in close relations with our customers.”

Streamlining information with the help of technology is a considerable factor that separates the good from the great. We live in a world where having the latest technology no longer cuts it. A shipper’s competitive advantage is not found in the kind of technology used for customer needs but more of what data is provided through technology to better understand, predict and manage customer needs. 

“We need not only to embrace technology but also accelerate the exchange of data as the impact is significant,” Olyhoeck adds. “Currently, too many stakeholders operate different systems with diverse needs. The use of digital pricing and booking platforms will help to increase efficiency and improve turnaround time, and it does get the attention from the shipper playing field to serve them with their best interest in mind.”

Collaboration is key and gathering the right data will further streamline processes to success. BDP manages its customer needs through the utilization of technology platforms that provide relevant, timely, and critical information. Combining the best of both technical capabilities and data, customers can rely on this approach to share the information needed to overcome market shifts. 

“BDP technology forms a fundamental part of how we manage complex, high care, dynamic supply-chains through both normal and abnormal market conditions,” Olyhoeck says. “We invest in platforms to provide insight into data integration and aggregation, platforms which support communication and exception management, and platforms that automate and simplify processes to help manage complexity and streamline our communications with customers. Our customers and partners are kept informed every step of the way in critical journeys.”

Even more significant is the need for more attention to budgeting and forecasting in the air cargo sector. According to Statista, 2021 will end with an expected 63.1 million tons of freight carried globally.

“Unfortunately, forecasting is underexposed,” Olyhoeck shares. “As in various industries, the budget and forecast for shipping pure air cargo is zero, but shippers still end up shipping millions of kilograms by air each year.” 

So, is there such a thing as a formula shippers can rely on for the future of the industry? Simply put, yes. But without key components of communication, technology and data, customer relationships and operations are projected for complications. 

“Energized teams supported by the latest technologies plugged in and managing global networks is not new to the industry,” Olyhoeck notes. “The chaos brought on from the pandemic, within the ocean markets impacting air, shows that having teams that can react, adapt, collaborate and solve using insight and intellect many times outstrips the technical component of competition.”

Simply put, modern market relationships and collaborations cannot be compromised. As Bob Hooey once said, “If you are not taking care of your customers, your competitor will.”

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Patrick Olyhoeck has more than 20 years of experience in the logistics sector. Having joined BDP in 2009, he filled local and regional positions before recently being promoted to vice president, Global Airfreight. In this role, he is responsible for one of the strategic key contacts for the international airline industry and the evolvement of offering premium global supply chain transportation service to a wide range of valued customers through the designed Global Consolidation Model. He can be reached at patrick.olyhoeck@bdpint.com.

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3pls, Archives, Global Logistics, Global Trade Daily

FORWARD-THINKING FORWARDERS: HOW TO MANAGE CUSTOMERS’ CHANGING NEEDS ALONG A CHANGING SUPPLY CHAIN

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For the modern-day 3PL provider, managing expectations while successfully retaining customers goes well beyond cost savings and providing the fastest alternative to moving products. It did not take the pandemic to realize the consumer market continues to shift significantly, creating spikes at every angle from transport costs, sourcing, space, resource flexibility… and the list goes on.

The meaning of “competitive” is now determined by a 3PL provider’s agility and predictability in tandem with optimizing the flow of goods throughout the supply chain. The big kicker in the current market is that as costs continue to go up, the available labor pool becomes smaller. So, then, how can 3PL providers keep up with the competition while retaining their customer base and adding value? It starts with how you manage customer relationships. Many times, the biggest competition is not the opposing team;  it is keeping up with the hit-and-miss market. 

Andy Frommenwiler, vice president of Air Freight USA at Dachser, has compiled a list of the top three shifts his company’s customers are considering or implementing:

1. Alternative solutions to source their product. To that end, local sourcing has become more competitive and paired with unpredictable rising costs of transportation.

2. Customers are moving toward longer-term forecasting to allow for disruption and the lack of supply chain fluidity.

3. Taking advantage of space availability for customers with smaller orders.

“Market disruptions will continue, and it is imperative to properly plan now because it is clear there will be ongoing capacity challenges and other forms of disruption throughout the year,” Frommenwiler cautions.

In addition to piecing together the puzzle of transporting goods without breaking the bank and tarnishing the reputation, 3PL providers are laser-focused on retaining their customer bases. While the market is scrambling, customer retention is a critical element to remaining resilient and maintaining a competitive edge. The key here is not so much about what you can offer customers, but more so how you can extend stability and transparency. 

“In today’s environment, it is crucial to maintain an initiative-taking approach and open dialogue with your customer,” advises Frommenwiler. “Informing customers of the current market situation, such as unstable pricing and space shortages, makes the customer aware of today’s challenges, which not only allows them to properly prepare but also highlights the importance of a strong, knowledgeable logistics partner.”

Always remember that the disruptions you are experiencing as a 3PL provider are almost always parallel to the challenges your customers are struggling to navigate. The value is how the 3PL provider not only provides support in solving these challenges, but also how much visibility is gained through the partnership. 

“Very high demand with low supply, port congestion, trucker shortages, mounting detention and demurrage charges are just some examples of the challenges companies are faced with today,” Frommenwiler notes. “As the planning experts, it is our responsibility to not only identify the challenges, but also to provide alternative solutions such as LCL expedited service, standard LCL or air freight options. 

“It is also critical that we insist on customer forecasts to facilitate better planning, booking, space allocation and superior utilization. It is important to gain trust and ensure the customer understands that, as their appointed forwarders, we are their partners and are not capitalizing on the situation by taking advantage and over-charging for our services.”

Another significant challenge in the current market is the labor shortage. Look at any industry, and you will find the need for workers. The same is true for players in the logistics arena–from 3PLs to customers, all are hurting from the labor shortage. 

“The current labor shortage situation is particularly challenging and difficult to manage,” Frommenwiler concedes. “Ground handling companies, which are managing several airlines, are simply overwhelmed with the amount of cargo and limited warehouse space. Consequently, it takes days to break down cargo. These delays contribute to further disruptions throughout the supply chain.”

The role of a logistics provider is to understand these disruptions while providing solutions that benefit the customer. Demand will continue to increase, that is not changing. When you take on the challenges of the customer as a logistics provider, you create the opportunity to understand what your competitors are faced with. The more solutions you provide to your customer base, the more trust, reliability and increases to your bottom line you create. When you invest in your customer, you invest in your company. 

“It is important for companies to start making proper investments now to position themselves for a successful future,” Frommenwiler says.

Dachser USA takes these investments to the next level when considering the needs of its customer base. In July 2020, the global logistics leader announced its new dedicated weekly Frankfurt-Chicago-Frankfurt flight service, connecting U.S. customers to the European market through a comprehensive land transport network from Frankfurt with rotations each weekend. The pandemic inevitably took its toll on the flow of the supply chain and in true Dachser style, the provider stepped up to the challenge, paving the way for advancements in innovation and expansion. 

“This new dedicated weekly transatlantic flight service offers a solution to the current air freight capacity challenges that our customers are facing,” Frommenwiler says. “They called upon us to provide a timely, efficient transportation option to move their cargo between the U.S. and Europe in a way that allows them to properly plan and meet their deadlines.” 

Market disruptions do not have to be the end of your brand–in fact, they can be the very thing that sets your services portfolio apart from the competition. At the end of the day, customers will select the logistics provider that can get the job done, maximize the bottom line and add value to the partnership. If your customer suffers, your company suffers. Offering the latest technology means nothing without measurable results, scalability and increased visibility. When thinking about how your company can best meet the needs of customers in a volatile market, start with the basics: clear communication. 

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Andy Frommenwiler is vice president, Air Freight USA, at Dachser.