20.09.2012 11:23

The challenge of remaining distinguished

During one of Finnair Cargo's recent sales meetings, as I talked about the importance of increasing cargo yield, one of my colleagues asked the following question: during a time of oversupply, how do we differentiate our product? Any company might face the fear that their services or products will one day become indistinguishable. In other words, people in our industry may begin to fear that we are just selling capacity.

Air freight is the most expensive mode of transportation. On a daily basis, we try to optimise cargo space for many different kinds of shipments: pharmaceuticals, electronics, spare parts for industries, chemicals, clothing, etc. The percentage of all goods transported by air is close to 30 per cent. These are sensitive and urgent shipments; should they not make it on time to their destinations, the entire supply chain could be disrupted and inventory issues could surface.

In addition to speed and price, a crucial advantage that an air cargo provider can offer is top service. Today's customer demands for a continuous flow of information, and is always seeking for better, faster, cheaper and more secure and reliable services. Today’s information era gives our customers all the necessary tools to make personalised purchase decisions.

As a result of globalisation and development in information technology, the needs of the supply chain are constantly changing. For supply chain professionals, predicting customer decisions and strategising accordingly is now a more complex process. At the same time, companies can no longer allow inventories to sit in warehouses or on cargo ships; fluctuating currencies and changes in demand could hamper the interest of collaborating partners and, in a worst-case scenario, result in obsolescence costs.

Due to these new challenges, the time that it takes for a product to get from its source to retail stores will play a crucial role in the management of inventory and sales. Customers also demand for stricter manufacturer-to-store time frames. It is estimated that close to six per cent of air cargo is transported in “express” mode. As logistics change, this percentage may grow in the near future.

Finnair Cargo’s new FIRST service is designed to meet the needs of cargo customers requiring faster delivery times. These deliveries take high priority status and are accompanied with the guarantee that they will be transported on specific scheduled flights. The route network covered by this service is growing; it was first available for cargo travelling to and from Helsinki, and in August it expanded to flights originating from China (Shanghai,  Hong Kong, Beijing and Chongqing) and bound for Finnair’s European destinations. FIRST became available for transit freight on flights departing from India starting from September 9, 2012.