21st April 2020 – (Hong Kong) There have been many improvements in the air freight and cargo industry in recent years. Still, with demand expected to grow much higher in the future, there are massive expectations that businesses will need to live up to in order to thrive and compete in the industry.
For the air cargo industry, it’s definitely good news that more countries are ramping up their requirements more than ever before and it provides terrific prospects for improved income and the future of the air cargo industry in general.
Nonetheless, for air cargo companies to be able to take full advantage of the prospects that will present themselves, they will need to be able to endure often rough and trying times. The future of the Air cargo industry may be bright, but that doesn’t mean that there won’t be obstacles to overcome. For several businesses in the sector, being ready and able to respond to an evolving global environment and building strategic alliances will be crucial to its long term success.
Let’s take a look at what the future of the cargo industry looks like:
A Look At The Future Of Cargo And eCommerce
E-commerce has long been a significant industry, as more and more consumers opt to buy their shopping online. Amazon, one of the world’s largest mail-order firms, has seen demand grow and shipping costs associated with that have increased the company’s shipment costs. Amazon was spending roughly $14.3 million on shipping goods to consumers in the US during 2018. Boeing is backing up shipping prices, citing figures of $1.83 trillion in shipping costs during its 2017 financial year. By 2021, Boeing estimates that this figure will have risen to $4 trillion with 17.5 percent of the global market share.
More and more online retailers are using air freight solutions because of the ability it provides companies to deliver goods to their consumers who are located around the world, more rapidly. It should take no longer than 72 hours to fly from the business in one country to the customer’s door in another when air freight is used, and this speed of response is something that is a significant concern for many. It is expected that this part of the market will continue to grow, with a projection for the next three years from 2020 of a 20 per cent rise in goods being transported by air cargo.
Despite the massive expansion expected, when the market finally plateaus, businesses must be ready. Those businesses that currently rely on an abundance of sales need to build a more detailed plan for the longer-term future.
Adapting The Cargo Industry For The New Digital World
As described above, the industry as a whole wasn’t quite quick enough to accept digitalization as a new way of commerce, but that’s something that will need to change. Especially if companies want to stay in business. With more competition entering the market ready to give the customer a better experience than the last company, it is a case of either keeping up with growing trends or failing completely.
The digital world allows businesses to provide a more straightforward process for consumers, with fast delivery and correct handling, eliminating manual errors. It is also eco-friendly, as well as being more productive, something that is a growing concern for a lot of customers around the world.
As an example, if automation is used, booking time for an item will plunge from an hour to under one minute. Legacy systems can’t keep up with such dramatic efficiencies, and businesses looking to remain in business have no choice: either embrace automation or plan to be edged out.
Adopting All In Rates
All-in prices are a major factor in the air cargo industry’s drive for openness and simplified pricing. But this is not where creativity will end. Airlines and shippers need to take advantage of available data to have precise, long-term pricing; embracing technology would allow customers to get all-in prices in seconds from parcel shipping websites.
Working With Varying Markets Around The World
E-commerce and air freight are now well developed in the west, but this is not the case everywhere. There are a variety of countries in emerging economies such as India and Asia that have only recently got their foot in the air cargo industry’s door and are now increasing their air cargo shipping loads.
Though there is still a steady flow of business in other countries such as China, the increase in cargo has been massive. For instance, China’s new cargo service to New York has been scheduled three times a week, marking an enormous upswing in cargo output to the states.
The increasing amounts of air cargo reveal that while there might be international conflicts and trade spats, governments around the world are willing to work together when it comes to efficiencies and crossing borders to get the products they need.
The Future Of The Air Cargo Industry From 2020
The future of air freight is quickly approaching. It has been of great help and assistance during the COVID-19 outbreak the world over as medical supplies, food and consumer goods have continued to flow. If businesses don’t already use air cargo or plan to use the new technology, several companies will end up kicking and screaming on their way down the ladder of success.
Innovation is vital to remaining viable and competitive in the world of business. All companies should be looking at ways to get goods out to their customers and as quickly and as efficiently as possible if they want to survive in the future.