31 Oct How digitization can help overcome inadequate capacity utilization?
2021 was a wonderful year for air cargo. This was the time when people started to think beyond the pandemic, and the export-import activity touched a new height. Demand was high, and so was the supply. All these factors put together gave a significant push to trade, and the same was reflected in numbers too. A year later, the situation has turned around – shortage of demand & supply, and lack of capacity utilization.
Inadequate capacity utilization is not new
Lack of capacity seems like a macro situation that is beyond everyone’s control. However, industry experts believe otherwise. Inadequate capacity utilization is not something, which arose due to the pandemic or demand supply mismatch situation. It arose due to disproportionate cargo flow, restricted cargo predictability, and structural overcapacity. Yes, even before the pandemic, we did hear all these terms.
Digitization – the optimal way out
For an industry that is considered fast-paced, air cargo does lack end-to-end visibility, and transparency and involves manual intervention. Therefore, the industry needs digitization to overcome critical challenges like inadequate capacity utilization.
Here are some benefits that digitization can offer to the air cargo industry.
Thwarting challenges on a process level
Cross border trade is complex, and it involves several macro and micro functions. There is not one, but hundreds of stakeholders involved. A glitch in any one of these processes would delay the movement of cargo in the whole supply chain. Therefore, digitization comes with a process level framework, which in turn assists in overcoming the glitches involved in each process. By doing so, the entire supply chain is active and running.
Paperless trade
Manual documentation is the foremost challenge that the industry faces and to move one shipment at least 30 documents are required with 100+ copies. However, with digitization all these documents can be made available online through e-dockets and approvals from relevant regulators too can be obtained online in a few clicks. This will not only reduce the number of paper copies consumed, but it will also make way for achieving sustainable development goals.
Predicting unprecedented situations
Experts believe that overcoming an unprecedented situation would have been easier if it was predicted well enough. Artificial Intelligence offers predictive capabilities to predict demand supply slump/surge so that the stakeholders can be prepared to overcome the situation.
Air freight software solutions – the way forward
Digitization is the way forward for the industry, and already several airports and regulatory bodies are stressing the need for the same. On that note, stakeholders are beginning to leverage the existing air freight software, cargo community systems, and cargo management systems that are existing in the market. These solutions are holistic in nature, and they connect all stakeholders involved in the trade. Moreover, these solutions are evolving with a corridor to connect two or more airports as well as other modes of transport.