Air cargo can be an important and highly efficient component of today’s optimized supply chain. For many products, markets and industries, air cargo is the critical link that allows organizations to respond to customer demands in a timely manner. Multiple air shipment options, as well as advancements in reporting and aircraft efficiency, make air cargo essential for many supply chains.
Indeed, air cargo can help organizations optimize their supply chain in three important ways. It allows the speed needed to deliver time and temperature sensitive products, provides reliable access to remote and developing locations, and can offer the best combination of service and price.
Quick Response to Market Demands
Air cargo is simply the only service that delivers the speed needed to respond to constantly changing customer demands.
Market response. With air cargo, shorter lead times for inventory replenishment are realized and a company can quickly respond to holiday or seasonal demands, as well as reduce inventory carrying costs. All of that adds up to a supply chain that offers efficiency coupled with flexibility—providing customers the agility necessary to contract and expand with market needs.
Time and temperature sensitive products. Air cargo also provides the perfect way to extend shelf life for both time sensitive and temperature sensitive products. It gives another way to increase inventory life and decrease potential losses.
These quick response times also come in handy when dealing with unforeseen events, like factory delays or urgent customer demands. Addressed early, these situations can provide an opportunity to position companies as the problem-solver instead of the problem. Working with a provider who can seamlessly shift from one service to another, depending on needs, offers an advantage over the competition.
Value of Technology in Air Cargo Services
It is very important to find a provider that offers seamless access to multiple services along with true visibility from a single platform.
With the use of Electronic Data Interchange (EDI), a top-notch provider can offer current updates about shipments, 24/7.
Benefits of Air Cargo in Emerging Markets
In emerging markets, air cargo can often be the only reliable method to connect customers with goods. As part of a seamlessly connected global supply chain, air cargo can facilitate growth into new markets.
It’s also important to realize that in today’s global marketplace, it’s not just about being fast, it’s about being first. Having the flexibility within the supply chain to be first to market offers many advantages. Whether a company is looking for a service that’s fast, first or simply flexible, air cargo can fill a critical role in making sure that a supply chain is meeting business objectives and serving customers’ needs.
Time And Money: The Metrics of Air Cargo
When evaluating the costs of air cargo, the freight cost is only one component of the equation. Inventory carrying costs and the sales opportunities associated with being first to market are important considerations for shippers.
The increased use of more fuel-efficient cargo fleets has changed the cost equation as the opportunity to capture market share can offset freight costs.
Keeping Overall Spend in Mind
For many industries, like automotive, aerospace, electronics and medical devices, air cargo is an essential component of an optimized supply chain.
Finding a provider who offers access to the benefits of mode-neutral routing can widen shipping options. Mode-neutral routing allows a provider to put a company’s needs first by selecting the service that best suits the specific shipping requirements and expectations. This allows for tightening the supply chain— focusing on overall spend rather than specific costs.
Saving a few dollars here and there on air cargo does not make sense if delaying time to market increases inventory costs or unnecessarily lengthens the cash-to-cash cycle.
Simply choosing services based on price alone can negatively impact the supply chain. In any economic climate, shippers should remember to calculate the cost, door to door, keeping in mind the right blend of spend to the best benefit to their overall business concerns.
That’s why taking advantage of a mode-neutral relationship with a multimodal shipping provider is a smart business move in today’s ever-changing global market.
Matt Castle is vice president, Global Forwarding Products and Services, at C.H. Robinson, which is one of the world’s largest third-party logistics providers. The 3PL provides a broad portfolio of logistics services, fresh produce sourcing and managed services through its global network. In addition, the company, its foundation and its employees contribute annually to a variety of organizations. For more information, visit www.chrobinson.com.
MULTIPLE FACETS OF AIR CARGO
* Know the options within this transportation service: next flight out, consolidation, and deferred services. There is no one-size-fits-all air cargo solution. An experienced provider will help determine which type is best for supply chain efficiency.
* Ancillary services such as customs clearance and distribution/delivery sourcing may not be top of mind when considering freight options, but they move in concert with the speed of freight and are key to ensuring on-time delivery. An experienced provider keeps these in mind when advising the best options for a business—helping translate an optimized supply chain into lower overall transportation spend.
YOU ARE ON FIRST
A provider should put a company’s priorities first by choosing the specific air service that best suits the company’s needs:
Next flight out. Urgent, fast and most costly
Consolidation. Moves on a schedule as a consolidated shipment with other freight, pro-viding both time and cost efficiencies.
Deferred. Moves as a lower priority with longer transit time for the most cost savings.
FOUR REASONS TO RETHINK AIR CARGO IN A SUPPLY CHAIN
Seek a provider that offers:
- Quick response to market demands
- Global visibility on a single platform
- Better access to emerging markets
- Increased value from a supply chain optimized with the right air service for any specific business needs
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