By Ato Fitsum Abadi, Managing Director, Ethiopian Cargo
Before we go to what we mean by transparency and quality from the shipper’s perspective, let me explain why shippers prefer or choose airfreight over other modes of transport, despite airfreight being more expensive.
Primarily, shippers choose airfreight for its speed. When goods need to be moved quickly, airfreight is the best solution compared to sea freight or road transport.
An added advantage to the speed of airfreight is that it reduces the need for local warehousing and inventory as items travel faster to their destinations.
Another benefit to airfreight is that it provides highly reliable arrival and departure times when flown as booked. This is because airline schedules are followed consistently. Airfreight also provides the benefit of a detailed tracking system that shippers can use to follow the shipment’s entire route.
Then we have to have a secure mode of shipment. Airports provide security systems and infrastructure such as CCTV, which deters theft. They provide tight security controls which reduce loss and damage of items. In addition, customs clearance is also more efficient in airports than at land and sea ports.
Finally, airfreight can also provide savings in packaging, as items shipped by plane require less packaging than sea and land, saving both time and money.
Now, let’s have a look at what transparency and quality mean from a shipper’s point of view.
Shippers have a range of transparency requirements when it comes to choosing airfreight.
Transparency helps to clarify the complex value chain that involves a range of stakeholders, from forwarders to ground handling agents to customs and packaging services. Transparency allows for simplification of the shipping and clearance processes.
Shippers also require transparency of information on booking, pricing, capacity, and any other special conditions that are important for storing, shipping, clearance and delivery.
Due to the number of stakeholders involved in the shipping process, there needs to be clear communication and confirmation on maintaining schedule integrity. When deviations from the plan occur by force majeure, or any other valid reason, there needs to be a proactive, and when possible prompt and reactive communication to both shippers and consignees, as well as between associates.
There are a range of costs associated with airfreight, some of which are hidden and some that are added on a cost plus basis. These include fuel and insurance surcharges, destination taxes, consolidation/deconsolidation charges, documentation charges, clearance charges among others. These extra charges complicate the billing process but it can be simplified by consolidating all expenses into a single price and payment mode.
When choosing airfreight, shippers consider clear policy and process for dealing with issues or problems, such as irregularity handling (damage recovery) and procedures for claim settlements in case of loss, damage or theft.
Finally, up-to-date and reliable online tracking of shipments is one of the advantages of airfreight and adds to the transparency of the process.
When shippers choose airfreight services, the main determining factors that measure quality of service delivery are: schedule integrity (one hundred per cent reliability on flown as booked of shipments); up-to-date information on tracking systems, and smooth and hassle free delivery processes.
Since airfreight can provide detailed tracking of shipments from acceptance to delivery, shippers expect accurate, prompt and complete information on a shipment’s status as well as guarantees that the shipment is delivered intact, undamaged and complete.
International security standards and regulations, which guarantee a better quality of service, offset the higher price of air freight and are another factor in choosing airfreight.
Shippers also require the option of consolidation/deconsolidation and the opportunity of transhipment to avail themselves in the free trade zones. Also vital is specialisation in handling different shipments that are temperature sensitive and high value.
Flexibility to meet customer requirements and provide dependable and competent customer service are an important factor in choosing airfreight. Providing a well-integrated and simplified service chain in a one-window service would give shippers an edge in the marketplace and is a major factor for shippers choosing airfreight.
In order to simplify the process, integrated multimodal logistics services should be provided in a single document.
Finally, shippers require high quality IT platforms for them to communicate between associates, with service providers and access all information about shipments. This means that there should be an availability of paperless services such as e-freight and e-AWB to avoid complex bureaucratic procedures.