The bottomline impact of digitalisation for air cargo stakeholders
Airports play a very important role in the logistics value chain. These are the hubs of commercial activities and as one of the studies have revealed in the past the air cargo spends more time at the airport for processing and clearing than actually flying which is the core value that the end customer expects
Cargo processing and clearing are time intensive features of logistics and these features have gotten increasingly evident through greater focus on digital infrastructure. Kale Logistics Solutions, known for their suite of comprehensive IT enterprise systems, is committed to address these logistics issues through their cargo community platforms. In this interview, Amar More, CEO, Kale Logistics Solutions briefly discusses the working of Air Cargo Community Systems, which offer a single electronic window capable of supporting operational flows, percolating data to various stakeholders and facilitating the paperless exchange of trade-related information between stakeholders.
Airports across the world are looking to transform themselves into cargo hubs. How can Air Cargo Community Systems help?
Airports play a very important role in the logistics value chain. These are the hubs of commercial activities and as one of the studies have revealed in the past the air cargo spends more time at the airport for processing and clearing than actually flying which is the core value that the end customer expects.
Most airports across the world have been traditionally operating a “land-lord” or a “concession” model regarding the air cargo and have thus far kept an arm's length from the core operations or growth of cargo unlike some other airports who have been deeply involved in promotion as well as operations of air cargo. However, times are changing now. With increasing competition, pressure from regulators around security, pressure for creating Trade Facilitation infrastructure to comply with the WTO's Trade Facilitation agreements, the need to increase economic activity and create more jobs; the airport's involvement in the core cargo business is increasing now.
In order to address the above and ensure customer satisfaction so that the stakeholders are motivated to bring cargo to their airports, the airports have to create next generation digital infrastructure for cargo. We call it creating the “Airport Single Window” for airport's stakeholders that will help in trade facilitation. This is also like building an Air Cargo Community around the airport. The true next generation Airport Cargo Community systems do exactly that for the airports.
The general expectation is having an ACS will solve all current problems. How true is this statement? Does it make internal automation systems irrelevant?
Since supply chain by definition extends beyond the enterprise, having just good IT systems for automation of cargo handling activities is not sufficient. There are serious inefficiency and transparency issues in the supply chain although a lot of stakeholders have their own automation systems in place. Let me give you an example. An MNC forwarder has a world class system, a multinational handling company has a world class system as well.
However, in the absence of an airport community system, the handler doesn't know how many trucks to expect when and this often leads to congestion and higher dwell times at the airport. This is just one simple case. We have identified around 100 such use cases of a community system which will give you the scale of the problems that can be solved by such single windows. Internal systems are relevant but not sufficient in making the air cargo industry more efficient. The need for effectively connecting to the stakeholders can't be understated.
Has digitalisation helped stakeholders cut their operating expenses and improve bottom-line?
This is very simple to understand. With air cargo community systems, through advance data exchange stakeholders have been able to reduce waiting times at the airports, there's no need to run from pillar to post for shipment processing, there's reduction in duplicate data entry, reduced paper work, reduced mal-practices, better transparency across the supply chain all causing reduced operating expenses and this reduction goes directly to improve the bottom-line. I am personally extremely excited about the proliferation of such community platforms and I believe the industry will change forever with the next generation airport cargo community systems.