Can technology solve biggest inefficiencies in global supply chains?

With the emergence of AI, IoT, predictive tools and advanced tech platforms, airlines, airports and retail giants can maximise profits, improve operations, and reshape supply chains.

Can technology solve biggest inefficiencies in global supply chains?
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“Due to the lack of proper technology, most airlines operate with 85% of the bottom of their aeroplanes empty,” said Jeff Pan, the former Teleport Chief Product Officer (CPO) and founder of Belli. His statement underscores a significant inefficiency in the air cargo industry—a sector that, while representing 35% of global trade by value, accounts for only 1% of global trade volume. The adoption of innovative technologies is poised to enable better utilisation of cargo space, boost revenue and optimise supply chain operations.


“Due to the lack of proper technology, most airlines operate with 85% of the bottom of their aeroplanes empty.”
Jeff Pan, Belli

Bridging the gap in air cargo utilisation
Pete Chareonwongsak, CEO of Teleport, AirAsia's logistics arm, highlighted a similar issue. “Only 28% of the total air cargo space, including the belly of passenger flights, is used,” he stated. This underutilisation represents a massive opportunity for airlines to enhance their operating margins. The former CPO of Teleport emphasised that filling the underused cargo space could potentially double an airline’s operating margin on a flight.

AirAsia is an excellent case study of how technology can transform this landscape. Pan mentioned that by adopting advanced air cargo solutions, the low-cost Malaysian airline increased its revenue from $20 million to $200 million in just five years. Despite this progress, air cargo remains a blind spot for many major airline vendors, with companies like Amadeus focusing almost exclusively on passenger technology while neglecting a $146 billion cargo market, highlighted the former CPO of the Southeast Asian airline.


“Real-time tracking has become essential for achieving visibility as well as operational and sustainability efficiency in the rapidly evolving logistics landscape.”
Klaus Dohrmann, DHL

Pan’s current venture, Belli, addresses this gap by automating manual processes in cargo terminals, helping airlines maximise their capacity and revenue. “Forward-thinking airlines are shifting their IT spend away from paying for ‘change requests’ with existing legacy software vendors, aiming to increase their speed of digitisation and maintain greater long-term control of their data,” Pan explained.

Breaking free from vendor lock-in
One of the most significant barriers to technological progress in the air cargo industry is vendor lock-in. Airlines often rely on legacy software providers for system customisations, which can be both costly and time-consuming. “What airlines have started to realise is that third-party vendors can build these customisations on top of their existing systems 10x faster and cheaper,” Pan noted. This approach ensures that data and customisations remain with the airline, enabling flexibility and future-proofing operations.


Pan compared the situation to owning a smartphone where only the manufacturer can install apps or updates, limiting personalisation and improvement. By adopting modern, third-party software solutions, airlines can overcome these limitations and tap into the full potential of their cargo operations.

As airlines explore alternatives to vendor lock-in, could adopting AI, IoT, and predictive analytics be the key to enhancing efficiency and transforming cargo operations?

AI, IoT and predictive analytics: Transforming the cargo industry
The logistics industry has undergone significant transformations driven by AI, predictive analytics, IoT, and advanced systems that enhance operational efficiency, improve accuracy, and build resilience. Key players like DHL, Etihad Cargo and Frankfurt Airport are leveraging these technologies to optimise demand forecasting, cargo management and supply chain visibility.

For instance, DHL is harnessing AI and predictive analytics to analyse historical data, seasonal trends, and customer behaviour to forecast demand accurately. This enables efficient allocation of resources, particularly during peak seasons. Klaus Dohrmann, Vice President of Innovation & Trend Research at DHL, emphasised, "DHL uses predictive analytics to anticipate disruptions and optimise delivery routes."


In addition to AI, DHL incorporates IoT sensors to provide real-time tracking of shipments. These smart sensors help monitor variables such as location, temperature, and humidity, ensuring sensitive goods, like pharmaceuticals, are safely transported. Automation in warehouses further improves operational efficiency, particularly during workforce shortages. “Real-time tracking has become essential for achieving visibility as well as operational and sustainability efficiency in the rapidly evolving logistics landscape,” mentioned Dohrmann.

On the other hand, the Middle-eastern cargo airline - Etihad Cargo - is utilising AI and computer vision to optimise load planning and reduce risks in cargo handling. Leonard Rodrigues, Director - Revenue Management & Network Planning at Etihad Cargo, explained, "By integrating a third dimension into our load planning, we create ULD-level plans that maximise cargo space and minimise the risk of overbooking or offloading shipments."

The use of AI-driven predictive tools has also proven essential for managing disruptions. For instance, when regulatory changes or environmental factors disrupt operations, Etihad Cargo uses predictive analytics and real-time data to mitigate risks and ensure smooth operations. "Although current tools support effective management of peak seasons and known variables, there is a clear need for more advanced predictive capabilities to address these dynamic challenges," Rodrigues said.


“Etihad Cargo’s Control Centre provided real-time visibility and coordination, enabling us to reroute shipments efficiently and maintain operational continuity [during severe floor in Dubai].”
Leonard Rodrigues, Etihad Cargo

Furthermore, Etihad Cargo has demonstrated how advanced systems can ensure high service levels during crises. During severe flooding in Dubai, “Etihad Cargo’s Control Centre provided real-time visibility and coordination, enabling us to reroute shipments efficiently and maintain operational continuity,” mentioned Rodrigues.

Airports, too, are leveraging technology to optimise cargo handling and improve operational efficiency. Frankfurt Airport (FRA), for example, has introduced a real-time ‘Cargo Dashboard’ developed by allivate GmbH. This tool provides a comprehensive overview of the entire cargo process chain, enabling companies to identify bottlenecks and allocate resources more effectively. Martina Schikorr, Managing Director at allivate GmbH, explained, “The Cargo Dashboard supplies at-a-glance information about the entire process chain to all participants. It allows bottlenecks to be identified and for resources to be more efficiently allocated.”

Similarly, Edmonton International Airport (YEG) has embraced advanced technologies to transform its cargo operations. Alex Lowe, Director, E-Commerce, Cargo & Aviation Real Estate at YEG, highlighted the airport’s commitment to leveraging technology, stating, “Staying apprised of the latest technology available in our industry and identifying like-minded partners is essential in achieving our objective of growing sustainably.” He added that digitisation and technology play a pivotal role in achieving transparency, efficiency, and resilience in cargo operations.


“Staying apprised of the latest technology available in our industry and identifying like-minded partners is essential in achieving our objective of growing sustainably.”
Alex Lowe, Edmonton International Airport (YEG)

In 2021, YEG became Canada’s first airport to integrate commercial drone delivery into daily operations. Expanding in 2024, the airport partnered with Drone Delivery Canada (DDC) and others to launch a drone capable of transporting time-sensitive products over 10 kilometres, marking a significant advancement in first- and final-mile delivery. “This drone programme demonstrates the tremendous advancements and innovations in YEG’s cargo operations and the power of partnerships in implementing new technology,” Lowe remarked.

In addition, YEG is building expansive facilities for automated e-commerce logistics and distribution, integrating sustainability measures like hydrogen and solar energy. Lowe emphasised the transformative impact of technology, noting, “The use of real-time data and analytics enables cargo operations to make informed decisions, improve cargo movement, provide visibility, and reduce delays.”

Frankfurt Airport has also piloted predictive analytics and AI in its turnaround management processes. By using computer vision and AI models, the airport predicts handling times, significantly shortening processing durations. A similar system at Ljubljana Airport in Slovenia , which is operated by Fraport, reduced processing times by six minutes within three months. These advancements showcase how technology is reshaping airport operations globally, from predictive analytics to drone deliveries.

As airlines and airports explore advanced solutions, tech platforms like cargo.one and Trackonomy are offering innovative tools to further enhance efficiency and visibility across the supply chain. How?

How can smart data transform the air cargo sector?
Talking about how cargo tech companies can solve inefficiencies with data analytics and artificial intelligence, Moritz Claussen, Co-CEO of cargo.one, shared, "What we offer today is a very comprehensive rate management to have all of these rates in one place, whether it’s their buy rates or their sell rates." By digitising and structuring data, cargo.one has created a robust database that enables more advanced technological applications.


Claussen also emphasised the importance of efficient workflow rather than attempting to completely change long-standing processes in the air cargo industry. "We need to support existing workflows with technology," he stated. This approach has proven successful in driving operational efficiency without major disruptions to traditional systems.

On the other hand, another innovative company - Trackonomy - is leveraging IoT and smart technology to address visibility challenges in logistics. In a recent interview with The STAT Trade Times, Mac McGary, Executive VP of Global Sales at Trackonomy, highlighted the importance of integrating technology from the ground up, saying, "You’ve got to integrate from the semiconductor chip all the way through to support, and that means we have built our own products, our own manufacturing plant, and our own engineering."

Trackonomy’s "smart tape" technology could be a game-changer for the air cargo industry. "We engineered a product for a really inexpensive multi-radio, small, smart tape that they could use... all the way from a Pfizer location, through the UPS network, to a hospital," said McGary, explaining that this innovation was crucial for tracking medical shipments, including the distribution of vaccines during the pandemic.

Trackonomy’s smart tape not only tracks location but also monitors environmental conditions such as temperature, ensuring cargo is kept within optimal conditions. "We think of it not just as another tracker but as smart agent technology," McGary said. This technology can track whether an item is too hot, too cold, or in the wrong location, reducing the risk of theft or mishandling. The company aims to extend this smart technology across high-value cargo and cold-chain shipments, such as pharmaceuticals, and expand it into low-value, high-volume shipments.

McGary also discussed how Trackonomy’s IoT-enabled platform is designed to improve real-time decision-making, stating, "We want to create actions in the moment... not just reporting after the fact, but sending alerts to someone close by to correct the action."


Paving the path towards digital transformation and innovation
During an interview on the sidelines of TIACA Air Cargo Forum in Miami, Cedric Millet, Chief Strategy & Digital Officer of ECS Group and President of CargoTech, underscored the importance of digital transformation within the air cargo industry. "What makes me happy is that all players have started their digitalisation journey, though I’m impatient with the pace. We have a window of two years to really benefit from this wave of digitalisation," he said.

Millet believes that the right solutions are in place to support airlines at every stage of their digital journey, from advanced revenue optimisation to basic automation for less mature players. He emphasised, "We are covering the entire spectrum of digital solutions, whether it's for the most mature or those just beginning their digital transformation."

Almost every leading air cargo player, from Atlas Air’s Michael Steen to Judah Levine from Freightos, spoke about the rise of e-commerce cargo and capacity constraints. But, there’s another issue with cross-border e-commerce shipments. "When you have 100 tons of e-commerce parcels, clearing customs efficiently is critical," Millet noted. "You need a digital solution that can expedite that process."

As cross-border e-commerce grows, addressing customs clearance challenges through digital solutions is becoming essential for maintaining efficiency in retail supply chains.

Technology’s impact on retail supply chains
The retail world is also experiencing an unparalleled transformation. As e-commerce grows and consumer expectations evolve, retailers like Walmart are using cutting-edge technology to streamline operations, enhance efficiency, and meet the ever-growing demand for speed and accuracy.

Talking about the impact of technology on retail supply chains, Ashish Pathak, PA Product Director - Supply Chain at BCG (Boston Consulting Globe), highlighted the seismic shift that technology has introduced in forecasting demand. “Twelve years ago, we used simple moving averages for forecasting. Today, we have models with 20, 25, or even 30 variables, reducing forecasting errors from 30-40% to less than 10-15%.”


“Twelve years ago, we used simple moving averages for forecasting. Today, we have models with 20, 25, or even 30 variables, reducing forecasting errors from 30-40% to less than 10-15%.”
Ashish Pathak, BCG

Potentially, such precision is enabling retail giants like Walmart to maintain leaner inventories, reduce operational costs and increase product availability, ensuring they meet customer demand with unparalleled accuracy. Walmart's technological overhaul focuses on automation, with advanced robotic systems in distribution centers improving speed, accuracy, and inventory management. These systems enhance warehouse efficiency, minimise errors, and support high-skilled roles like automation equipment operators, reshaping jobs in the tech-driven supply chain.

Though technology has dramatically improved forecasting, Pathak emphasised the importance of addressing human barriers within organisations. This is a lesson the air cargo sector can take from Walmart's technological advancements. By adopting similar approaches to forecasting and warehouse management, air cargo players can leverage automation and data-driven insights to optimize operations, enhance efficiency, and overcome internal challenges that may hinder progress.

Despite AI's sophistication, organisational culture and collaboration remain crucial. Success in retail supply chains depends on aligning advanced tools with cross-departmental cooperation, ensuring agile disruption management.

But, who can predict the future?
The unpredictable nature of global supply chains—fueled by everything from political unrest to natural disasters—has made it increasingly important for businesses to be prepared for disruptions. Walmart uses AI and predictive analytics to simulate potential disruptions, whether it’s a surge in consumer demand or a geopolitical crisis.

With these tools, the company can adapt its supply chain strategy in real-time.

Pathak underscores the role of technology in helping businesses navigate this uncertainty, noting, “Technology is an accelerator. It won’t stop geopolitical disruptions, but it enables businesses to plan for multiple scenarios and make better decisions.”


The power of technology is undeniable, but Pathak insists that conscious leadership is critical in ensuring its success. “Technology is a catalyst for better decisions. But conscious business leaders must prioritise sustainability and resilience, ensuring their supply chains are not just cost-effective but also environmentally and socially responsible.”

Challenges and the road ahead
While the benefits of technology in supply chain optimisation are evident, challenges remain. Legacy systems, resistance to change, and the high initial investment required for digital transformation can slow progress. Moreover, the unpredictable nature of global trade—impacted by factors like geopolitical tensions and regulatory changes—requires robust and adaptable solutions.

As Jeff Pan aptly pointed out, the air cargo industry is on the brink of a technological revolution. By addressing inefficiencies, breaking free from vendor lock-in, and adopting cutting-edge tools, airlines, airports, logistics providers and e-commerce players can unlock new opportunities, enhance customer service, and strengthen their position in the global market. The road ahead promises innovation, collaboration and growth for all stakeholders in the supply chain ecosystem.

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