A report recently issued by Transport Intelligence (Ti), the UK-based so called think-tank, claims that supply chain management is undergoing a radical transformation which will lead to a
strong shift in dominating the service sector.
If this continues as the prognosis shows, then air freight supply chains will also have to change just as fast.
E-Commerce and its Supply Chains are growing fast
The report goes on to state that the fast increase in demand and supply to the general public will force further radical restructuring in the way e-commerce will be marketed in the future as well as a new supply chain structure.
The Ti report shows that in 2016 alone, that the global e-commerce supply chain grew by over 18 percent compared to the year before. The experts reckon with an average annual growth between 2016 and 20120 of around 16 percent.
The authors admit that it is very hard to give exact predictions on the actual growth pattern. Fact is however, that it is growing fast and it offers tremendous opportunities for the air cargo industry.
Integrators are way up front - and the legacy carriers?
We come back to the recent discussions (CargoForwarder Global recent reports) on exactly this subject and the necessity for the aviation sector to ensure part of the cake drops onto their plate.
Some, specifically the Express and Integrator companies seem to be taking this development in their stride.
One example shown in the Ti report is DHL Express whose e-commerce volumes now account for 21 percent of their total cargo volume. Three years ago, in 2013, this was just 10 percent. Much of this increase is said to be within DHL’s international volume.
A double increase within three years.
There is the domestic e-commerce market, which has shown to be a major boom within the United States and China, creating enormous volumes and forcing Amazon and Alibaba to create and control their own dedicated e-commerce airline fleets.
The international e-commerce market is taking the same direction and the question again arises as to how the traditional airlines can and will cope with this and ensure that a large portion of
shipments ordered travel on their main decks or belly holds.
It is estimated that “cross-border” e-commerce traffic accounts for around 15 percent of the present total e-commerce volume and that the cross-border growth rate is going to rise to 25 percent.
Lucrative and enticing figures, which will surely become reality as the e-commerce train continues to gather speed.
Who, on the air freight side will turn out to be the winner?
John Mc Donagh