Tag: ecommerce logistics

The digital revolution has ushered in a new era of commerce, one where the boundaries of global trade are increasingly defined by the clicks of consumers rather than the traditional brick-and-mortar constraints. E-commerce has not only changed the way we shop but has also significantly impacted the logistics and air cargo industries. The International Air Transport Association (IATA) and insights from the World Cargo Symposium (WCS) provide a comprehensive look into how e-commerce shapes the future of air cargo, emphasizing the surge in cross-border transactions and the individual growth statistics within e-commerce.

E-commerce’s growth trajectory has been nothing short of phenomenal, influencing a wide array of sectors, with air cargo being one of the most significantly impacted. According to IATA, the demand for air cargo is experiencing an upward trend, largely fueled by the e-commerce boom. This is particularly evident in cross-border e-commerce, which has expanded the global marketplace, allowing consumers to purchase goods from any corner of the world. The convenience, speed, and broad product offerings available through e-commerce platforms are driving an ever-increasing volume of international shipments, necessitating efficient and reliable air cargo services to meet consumer expectations.

Publications covering the WCS further delve into the nuances of e-commerce’s impact on air cargo. They highlight that as consumers increasingly turn to online shopping for both domestic and international purchases, the logistics sector is undergoing a transformative shift. “According to IATA, one out of every five parcelled items currently transported has been purchased online, and the figure is set to grow to one in three by 2027.”  Traditional bulk freight is being complemented, and in some cases replaced, by the need to transport smaller packages to individual consumers. This shift requires air cargo carriers to adapt their operations, from how they manage cargo space to how they prioritize shipments, to accommodate the faster-paced e-commerce environment.

Cross-border e-commerce, in particular, presents unique challenges for the air cargo industry, according to Statista, it will be a $7.9 trillion market by the year 2030. It not only increases the volume of goods being shipped via air but also introduces complexities related to customs, international regulations, and the need for enhanced security measures. Despite these challenges, cross-border e-commerce offers significant opportunities for air cargo operators willing to innovate and adapt to the demands of the digital age. As detailed in WCS publications, companies that invest in technology to streamline customs clearance, improve package tracking, and optimize their logistics networks are well-positioned to capitalize on the growth of international e-commerce.

Statistics on individual e-commerce transactions underscore the scale of change. IATA data suggests that the percentage of goods purchased online and shipped via air is on a steady incline, with e-commerce expected to account for a larger share of air cargo volume in the coming years. This increase is not just in volume but also in the value of goods transported, reflecting the growing consumer trust in online shopping for high-value items.

The rise of e-commerce has indeed brought about a paradigm shift in the air cargo industry. To keep pace with this change, stakeholders across the spectrum—from airlines to freight forwarders to customs authorities—are reevaluating their strategies and operations. E-commerce will grow into a third of all air cargo volume by 2027 according to reporting from Air Cargo News. Innovations in logistics technology, such as automated warehousing, blockchain for secure and transparent transactions, and AI for predictive logistics, are becoming increasingly critical.

The symbiotic relationship between e-commerce and air cargo is shaping a new landscape for global trade. The insights from IATA and the discussions at the WCS highlight the challenges and opportunities this relationship presents. As e-commerce continues to grow, its impact on air cargo will only become more pronounced, driving further innovations and adaptations in the industry. The future of air cargo, intertwined with the fate of e-commerce, promises a journey of transformation, driven by the relentless pace of digital advancement.

In the fast-paced world of global trade and logistics, digitalization has emerged as a transformative force, revolutionizing the way air cargo operations are conducted across the globe. From streamlined processes to enhanced efficiency, the benefits of embracing digital technologies in the air cargo industry are numerous, promising a future of innovation and growth. However, amidst these promises lie several impediments that must be addressed to fully realize the potential of digitalization.

Digitalization in air cargo holds immense promise, with statistics painting a compelling picture of its benefits. According to the International Air Transport Association (IATA), air cargo volumes have steadily grown over the past decade, with a significant portion of this growth attributed to e-commerce. In fact, IATA predicts that air cargo will continue to play a crucial role in supporting global trade, particularly as consumer demand for fast and reliable delivery services increases.

One of the primary benefits of digitalization in air cargo is improved efficiency and operational transparency. By leveraging digital technologies such as blockchain, cloud computing, and Internet of Things (IoT) devices, stakeholders across the supply chain can gain real-time visibility into shipments, enabling better tracking and monitoring of goods. This not only enhances the overall customer experience but also reduces the risk of delays and disruptions.

Furthermore, digitalization facilitates data-driven decision-making, allowing airlines and logistics providers to optimize route planning, cargo loading, and resource allocation. This not only minimizes costs but also reduces the environmental footprint of air cargo operations, contributing to sustainability efforts in the industry.

Another key advantage of digitalization is the automation of manual processes, leading to increased productivity and reduced human error. For example, digital platforms can automate documentation and customs clearance procedures, streamlining the flow of goods through border crossings and reducing paperwork burdens for stakeholders.

Despite these compelling benefits, several impediments stand in the way of fully realizing the potential of digitalization in air cargo. One major challenge is the lack of standardization and interoperability among digital systems used by different stakeholders in the supply chain. Without common standards and protocols, data exchange and integration become cumbersome, hindering the seamless flow of information.

Additionally, concerns around data security and privacy pose significant barriers to the adoption of digital technologies. With sensitive cargo information being transmitted across digital networks, the risk of cyber threats and data breaches looms large. Addressing these concerns requires robust cybersecurity measures and industry-wide collaboration to establish trust and confidence in digital platforms.

Moreover, the upfront costs associated with implementing digital solutions can be prohibitive for smaller players in the air cargo industry, particularly in developing countries. Without adequate resources and infrastructure, these stakeholders may struggle to keep pace with larger competitors who have greater financial capabilities.

In conclusion, digitalization holds immense promise for transforming air cargo operations on a global scale. From improved efficiency and transparency to enhanced decision-making and productivity, the benefits are clear. However, addressing the challenges of standardization, cybersecurity, and affordability is crucial to unlocking the full potential of digitalization and ensuring its widespread adoption across the industry. By overcoming these impediments, the air cargo sector can embrace digitalization as a catalyst for innovation and growth in the years to come.

Growing Fast 

Air cargo has become a pivotal element in the global logistics and transportation sector, especially in regions like the Middle East and Africa. These regions are experiencing significant growth due to strategic geographic locations, rising e-commerce, and investments in infrastructure development. This blog explores the current state, growth projections, and the burgeoning e-commerce sector’s impact on air cargo in the Middle East and Africa, highlighting why these regions hold immense opportunities for the industry.

The Middle East, with its central geographic location, acts as a critical bridge between the East and the West. This advantage is not just geographical but also economic, facilitating quicker trade routes and enabling the region to become a hub for international air cargo operations. Similarly, Africa’s vast landscape and developing economies are opening new avenues for air cargo, especially with the continent’s increasing integration into global supply chains.

Recent reports and analyses predict a strong growth trajectory for the air cargo sector in these regions. The International Air Transport Association (IATA) has highlighted the resilience and potential for significant growth in air cargo, noting that markets in the Middle East and Africa are poised to expand rapidly. This is attributed to the ongoing investments in airport infrastructure, the expansion of fleets by local carriers, and the strategic partnerships being formed between global and regional logistics companies.

For instance, the Middle East is expected to see an annual growth rate of 4.4% in air cargo over the next two decades, while Africa is forecasted to experience an even more robust growth rate of 5.0%, according to the IATA. These figures underscore the optimistic outlook for the air cargo industry in these regions, driven by both intra-regional and international trade demands.

E-commerce is a significant driver of air cargo growth, with the Middle East and Africa witnessing exponential increases in online retail. The surge in digital platforms, increased internet penetration, and the young, tech-savvy populations are fueling e-commerce growth, subsequently boosting air cargo demand. According to Deloitte e-commerce in the middle East is expected to climb to $50 billion by 2025. And Africa e-commerce should surpass $50 billion in 2028 – in both regions there is a great opportunity resulting from e-commerce.

The combination of strategic location, growing e-commerce, and growth projections presents vast opportunities for countries in the Middle East and Africa. These regions can leverage their unique positions to become global leaders in air cargo logistics. With continued investment in infrastructure, technology adoption, and regulatory support, the air cargo sector can significantly contribute to economic diversification and sustainable growth.

Moreover, the rise of e-commerce presents an opportunity for local businesses to expand their reach globally, requiring efficient logistics and air cargo services to meet consumer expectations for fast and reliable delivery. This demand can spur innovation in the sector, including the adoption of green technologies, digitalization of customs processes, and the use of blockchain for tracking and security, setting new standards for global air cargo operations.

The air cargo industry in the Middle East and Africa is at a pivotal point, with significant growth projections and e-commerce expansions signaling a bright future. The strategic geographic locations of these regions, coupled with ongoing investments and innovations, are creating a fertile ground for air cargo to thrive. By capitalizing on these opportunities, the Middle East and Africa can not only enhance their positions in the global logistics and transportation network but also drive broader economic growth and development.

Air Cargo Market Modest Growth for 2024

As we head into the year, we have been speaking about the industry and now a bit more detail on the expected forecast. The air cargo industry is expected to experience a growth of 4.5% in 2024, according to the International Air Transport Association (IATA). This projection is in line with the International Monetary Fund’s forecast of a 3.5% increase in global trade, despite an estimated 3.8% fall in airfreight demand in the previous year. The growth is seen as a rebound from the recent decline, particularly in 2023, where air cargo has been decreasing, especially with a 3.8% decline.

Regionally, the growth rates vary. African carriers are anticipated to see a 1.5% increase in cargo demand, with Asia Pacific at 3.6%, Europe at 4.1%, Latin America at 7.7%, the Middle East leading with a 12.3% increase, and North America at 2.1%. Despite these growth expectations, the industry faces challenges, including geopolitical risks and economic uncertainties. These factors make predictions for 2024 difficult, and they could affect cargo capacity, especially if passenger services are reduced due to instability and higher fuel prices.

Furthermore, IATA expects cargo revenues to decline by 17.3% year-on-year in 2024 to $111.4 billion, influenced by falling yields due to increased belly capacity from passenger flights and stagnant trade. However, these yields are still expected to remain higher than historical standards. The decline in revenue this year is attributed to weaker demand, lower yields, improved ocean shipping reliability, and the return of belly capacity.

The global economic and geopolitical situation remains a concern for the industry. Experts suggest that the air cargo market might only pick up by the fourth quarter of 2024 at the earliest. The recovery is contingent on factors like geopolitical stability and central banks’ focus on growth over inflation. The industry also anticipates some volatility due to these various factors, but a small growth compared to the current year is expected. Notably, Hong Kong’s air cargo sector is likely to benefit from the full opening of its three-runway system in the coming year.

One of the key challenges facing the air cargo industry is the fluctuation in demand due to various global factors. Geopolitical tensions, wars, and conflicts can significantly impact the industry. For instance, the ongoing situation in the Middle East has delayed the recovery of air cargo by about a year. Additionally, passenger travel demands, and extreme weather conditions could also influence cargo capacity. A reduction in passenger services, often due to instability or higher fuel prices, can lead to a lack of available space in the belly hold of passenger aircraft, which is often used for cargo. This situation could benefit freighter operators, as they might pick up the slack caused by the reduced belly hold space.

However, it’s important to note that these projections are based on various assumptions, including GDP growth, inflation rates, interest rates, the strength of the US dollar, unemployment levels, jet fuel prices, recovery pace in China, and the state of global conflicts. Any significant changes in these factors could alter the projected growth rates.

In summary, while the Air cargo industry is expected to grow in 2024, this growth will be modest and subject to various global economic and geopolitical factors. Regions like the Middle East and Latin America are expected to see higher growth rates compared to other parts of the world. However, the industry must navigate through challenges such as geopolitical tensions, changes in passenger travel demands, and other global economic factors. However, these challenges are nothing new for this industry and the experts who build, manage, and innovate.

 

Cross-border e-commerce, a segment of online shopping that involves consumers buying products from sellers in other countries, has experienced significant growth in recent years. This market is reshaping how consumers and businesses approach international trade, offering new opportunities and challenges alike.

Market Size and Financial Outlook

The cross-border e-commerce market was valued at several hundred billion dollars, with expectations for continuous growth. According to Statista, it will be a $7.9 trillion market by the year 2030. factors contributing to this growth include increasing internet penetration, advancements in e-commerce technology, and a growing middle class with a taste for foreign products. The United States, China, and the European Union are among the leading players in this market, contributing significantly to both import and export activities.

Demand by World Region

Asia-Pacific is a powerhouse in cross-border e-commerce, led by China. The rising middle class in countries like China, India, and Southeast Asia is driving up demand for foreign products, especially from the U.S. and Europe.

North America, particularly the U.S. and Canada, stands out as major destinations for cross-border online shopping. American consumers exhibit a strong preference for unique products from Europe and Asia, including electronics, fashion, and beauty products.

Europe sees a keen interest from consumers in purchasing high-quality goods from the U.S. and Asia. The European market is characterized by its demand for luxury goods, electronics, and culturally unique items.

In Latin America, there is a growing interest in cross-border e-commerce, with a particular focus on products from the U.S. and China. The demand in this region spans various goods, including electronics, fashion, and health products.

The Middle East and Africa, though a relatively smaller market, are experiencing rapid growth. The demand in this region is for high-end luxury goods, electronics, and products not readily available locally.

Data and Trends

According to reports from the U.S. International Trade Administration and various market research firms, several trends are shaping the future of cross-border e-commerce.

The evolving landscape of consumer preferences reflects a growing global demand for authentic and distinctive products sourced from international markets. This trend is driving an upswing in cross-border transactions as consumers actively seek out unique offerings.

Advances in technology and infrastructure are transforming the cross-border shopping experience. Enhanced e-Commerce platforms streamlined payment gateways, and efficient logistics systems collectively contribute to simplifying the process for consumers to access and purchase products from overseas.

Governments around the world are proactively addressing the challenges of cross-border trade by refining customs and tax procedures. This concerted effort aims to create a more fluid regulatory environment, facilitating smoother transactions and fostering international trade relations.

E-commerce platforms are adapting to the global marketplace by localizing their content. This includes language translation features and the integration of local payment methods to offer international customers a more personalized and seamless shopping experience.

Despite the promising growth, cross-border e-commerce faces challenges like shipping costs, customs duties, and longer delivery times. Additionally, businesses must navigate various regulatory environments and cultural differences to succeed in global markets.

Cross-border e-commerce is not just a transient trend but a significant component of global trade. With technological advancements and evolving consumer preferences, this market is poised for further growth. Businesses and governments must adapt to these changes, ensuring efficient and consumer-friendly trade practices to thrive in this dynamic environment.

Air cargo is a vital cog in the wheel of global commerce, demonstrating a remarkable capacity for resilience through the ebbs and flows of recent times. The onslaught of the COVID-19 pandemic precipitated a dramatic downturn in air cargo volumes as passenger flights, traditionally doubling as cargo carriers, were drastically curtailed. Yet, this downturn set the stage for a robust resurgence, fueled by the meteoric rise of e-commerce and the ripple effects of disruption in alternative freight modes, such as sea freight.

The International Air Transport Association (IATA) reported a hearty rebound in air cargo volumes in 2022, notching up a growth rate of about 6.9% over the pre-pandemic figures of 2019. This rebound is a testament to the sector’s agility and its ability to pivot in response to global shifts.

A myriad of dynamics are steering the growth of the air cargo industry:

• E-commerce Expansion: The e-commerce explosion is driving an insatiable appetite for expedited delivery, directly benefiting the air cargo sector.
• Supply Chain Diversification: Risk mitigation strategies are leading companies to diversify supply chains, increasingly relying on the speed and dependability of air cargo services.
• Technological Evolution: Breakthroughs in aircraft technology, logistics software, and process automation are propelling air cargo into new heights of efficiency and cost-effectiveness.
• Sustainability Initiatives: The logistics domain is increasingly embracing sustainability, advancing towards greener aircraft and practices.

As we cast our gaze towards 2024, the air cargo industry is poised to maintain its upward trajectory, albeit at a tempered pace when juxtaposed with the immediate recovery post-pandemic. Projections for 2024 indicate:

• Stable Volume Growth: IATA anticipates a consistent increase in air cargo volumes, forecasting a rise in the vicinity of 4-5% for 2024 relative to 2023.
• Enhanced Capacity: With passenger air travel rebounding to pre-pandemic levels, the reintroduction of belly capacity is set to augment existing freighter capacities.
• Sustained Efficiency and Eco-Friendly Focus: Strategic investments in cutting-edge, fuel-efficient aircraft and the adoption of sustainable aviation fuels (SAFs) are expected to play a pivotal role in diminishing the carbon footprint of air cargo.
• Technological Synergy: The industry is on the cusp of a digital revolution, with AI and blockchain integration anticipated to streamline tracking, optimize efficiency, and fortify security.

While the air cargo grapples with the volatility of fuel costs, geopolitical instability, and pressing environmental concerns, these very challenges are paving avenues for inventive progress. The industry is on track to leverage AI enhancements and system advancements to drive cargo operations with greater efficiency and effectiveness. Furthermore, businesses are poised to tap into burgeoning revenue streams through cross-border and domestic e-commerce initiatives.

In summation, the 2024 forecast paints an optimistic picture for the air cargo industry, anchored by consistent growth, technological breakthroughs, e-commerce expansion, and a steadfast commitment to sustainable operations. Amidst the flux of global trade, air cargo is set to remain an indispensable link, continually evolving, and innovating to rise to the occasion of the ever-shifting market demands and obstacles.

 

In today’s fast-paced digital world, consumers expect swift, reliable, and efficient delivery services. The exponential growth of e-commerce platforms and the increasing demand for instant gratification have made delivery logistics a critical business aspect. This is where our solution, a technology transforming the way businesses think about delivery, can be leveraged, especially in the crucial “last mile” segment. Let’s delve into how SmartKargo is leveraging innovative last-mile and other technologies to redefine e-commerce delivery.

SmartKargo is designed to simplify air cargo operations, making them faster and more efficient. It provides real-time visibility, mobile capabilities, and seamless integration with other systems. Airlines can leverage the solution to ship e-commerce packages via their planes and use the SmartKargo solution for the entire delivery process from dock-to-door. The last mile, meanwhile, pertains to the final step of the e-commerce or small package delivery process, where a product is delivered from a local distribution center to the end consumer. It’s this segment that often presents the most challenges but also the greatest opportunities for differentiation.

One of SmartKargo’s standout features is its real-time tracking capabilities. In the e-commerce world, consumers want to know exactly where their packages are and when they’ll arrive. With SmartKargo’s sophisticated tracking algorithms, customers are granted a comprehensive view of their package’s journey. This not only boosts consumer trust but also reduces the number of customer service queries related to shipment whereabouts.

SmartKargo is not a standalone solution. Its strength is magnified when integrated with other innovative last-mile technologies. Our system integrates easily with insurance carriers, transportation management, warehouses, and other important e-commerce logistics systems. By integrating with such technologies, SmartKargo ensures that businesses can offer varied delivery options.

Another jewel in the SmartKargo crown is its ability to utilize AI for route optimization. By analyzing vast amounts of data, the technology can predict potential delays, factor in real-time traffic conditions, and determine the quickest, most efficient routes for delivery. This ensures that parcels arrive promptly, keeping customers satisfied and reducing operational costs.

At the heart of all technological innovation in the e-commerce space is the customer experience. SmartKargo understands this. By providing consumers with accurate delivery windows, multiple delivery options, and the peace of mind that comes with real-time tracking, it ensures that e-commerce businesses can offer an experience that meets, if not exceeds, customer expectations.

In the constantly evolving landscape of e-commerce, businesses need every advantage they can get. SmartKargo, with its emphasis on efficiency, integration, and customer experience, provides e-commerce companies with a robust solution to address the complexities of modern-day deliveries. As last-mile delivery technologies and others in the logistics ecosystem continue to evolve, integrating solutions like SmartKargo will be crucial for businesses seeking to stay ahead of the curve and deliver unparalleled customer delivery experiences.

 

We are in peak season, and the logistics provider can attest – Late nights, chasing down the few questions from customers, and ensuring they are providing the best customer service. According to NRF, an estimated 166.3 million people in the US will shop between Thanksgiving and Monday (Cyber Monday). That is across all channels and considering the US population is about 331 million people, that is an impressive number over 4 days. This means we are at prime peak season.

Many of the retailers had discounts deeper than last year to ensure to pull folks into the Thanksgiving weekend shopping window. As of Sunday 11/27, online spending reached $9.12 billion this year which is up 2.3% increase over last year and sops the $9 billion spent in 2020. While many are bracing for a recession based on the deep discounts it seems the holiday shopping season has started phenomenally. Online buying has been further enhanced by the buy now pay over time option that almost all online retailers are now utilizing. 

In-person, shopping has been affected. The deep discounts in the stores are not driving traffic. Many believed that there would be a new vigor for in-person Black Friday antics. However, it is not the case, analysts stated there was brisk traffic and that may be the ongoing trend this year with online activity being more the norm – especially with cyber-Monday still to come. I think there has been a permeant shift in US buying behaviors and the person will continue to be the loser with the trends in place. 

All this online purchasing will mean impacts on small parcel delivery. In many areas of the country, the last mile is coming under increased pressure. Today last mile is about 53% of the delivery costs. And customers are becoming increasingly worried about their packages and getting them into their hands. UPS and FedEx are allowing, buying, or partnering with Gig workers to help alleviate the costs and customer issues of the last mile delivery. These issues range from deliveries being stolen to their items just not showing up. In many ways the customer journey can be most impacted by a poor delivery experience – we will need to see how 2022 stacks up to the issues in 2021. 

The Christmas season seems to be off to a good start. But we have a lot of headwinds with inflation, a possible recession, China’s covid impacts, and the war in Ukraine. As of this blog being written, I am confident that e-commerce will be beating expectations let’s make sure your customer’s packages get there on time.

It is Thanksgiving here in the US, and in my opinion, the best holiday in the US. I love it because it is the truest American holiday. After all, it is celebrated regardless of where you are from, your religion, or even your political affiliation. It is about your family and friends looking backward and giving thanks for what has transpired this year. We at SmartKargo have a lot to be thankful for in 2022.

My first thought is around our culture – We are a global company with clients on five continents. We speak over a dozen languages with the best teams. This mix of customers’ languages and geographic distribution helps unpin the key parts of our culture which quite simply is you need to be “nice.” In today’s world being nice may not often be considered a “positive” attribute. However, our founders believe it is paramount to our success. Our empathy for our customers, our respect for our teammates, and our reverence for our local communities feed our culture. In my two years here, I am amazed at how nice we are, every day, from the CEO to the newest hired college teammate – it is how we operate.

We are thankful for the amazing customers. We have several customers coming on board this year, whether it’s for a better cargo platform or e-commerce and small package delivery. We know our customers are looking to transform their companies, innovate to drive better margins, and create new revenue streams. We have had many customers extend their relationship with us and that is the greatest vote of confidence in our culture and expertise. Moreover, we have worked with a customer to create a new product that extends global e-commerce shipping internationally.

I am very thankful for my teammates. We have a global team that is always there to help and make sure we have shared success. Our technology team is innovative and always pushing to build their skills and wow our customers. Our support functions like Finance, HR, and Operations are dedicated experts making sure we operate at the highest efficiency level.

Finally, we are thankful for our partners. From our technology partners to our delivery partners, we have solid integrations into the commerce ecosystem. We are so glad to work with so many companies dedicated to innovation and transforming the Air Cargo and Logistics market, numerous of who share many of our cultural attributes.

We should always take a break and look at what we need to be thankful for, and I am thankful for my two years here at SmartKargo. I am a foodie & as an American, I look forward to my turkey, mashed potatoes, and mushroom but being of Polish descent I also enjoy my Kielbasa, Czernina, and Gołąbki for dinner. I hope all of you enjoy a day of thanks. Happy Thanksgiving to all.

When I was young this is about the time of year, I created my Christmas list and like most kids made sure I was being a very good boy to ensure I optimized my gift count! I did not want coal in my stockings. But coal is exactly what many small package shippers are getting this year.

Now I am grown up and working in the logistics field – this changed my Christmas list-making. Today, I give more gifts than receive and after approximately 20 years at UPS, I know what it takes to get packages from one city to another. During my time at UPS, there were consistent but unwritten rules. One was the 4.9% rule – This meant every year General Rate Increase (GRI) was 4.9%. I knew it, my customers knew it, and believe it or not the competitors knew this as well. The other was fees. There are fees for fuel surcharges, residential and so many others.

I knew my customers needed a different approach that was focused on ensuring fast 2-day time and transit while providing customer service and ensuring small package shippers are focused on their customers not the rates from the large established delivery partners. It was amazing to me that customers just accepted the 4.9% yearly increase. But that changed; in 2022 it went to 5.9% and in 2023 it will be an increase in GRI of 6.9%. I guess some rules were meant to be broken.  

Breaking the rules or the status quo is why I am here at SmartKargo. I believe that there should be an agreement on a price that price. All the assessorial fees mean that a price is not really, the final price. Many of the main delivery partners let the assessorial fees drive their margins and to add additional complexities, they may spring the changes on a customer with only a few days before they are life. It is impossible to plan and ensure SVPs, VPs, and Directors of logistics can be within their budget. Moreover, if you pass these fees onto your customers, it impacts sales or at least margins. I know all these logistics leaders are focused on cost but also on being the strategic last part of the customer journey.

I work at SmartKargo because it is an ‘Alternative Delivery Network.’ What is that? Well, it means we do everything the big guys do but with advantageous pricing and 2-day time and transit across the United States. We do not have a list of assessorial fees that we publish or use as “Levers” to drive more revenue. We want to help you meet your SLAs. Be within budget and make 2-day delivery a reality across the US. A bonus for me is we are also sustainable. Because we use an airline partner we are using “belly space” on passenger airlines. With over 800 flights a day, these passenger planes fly no matter what, and using this space does not increase fuel consumption and optimizes the flight for its carbon impact. 

When you look at Uber, Airbnb, and other innovative companies they saw an opportunity to upset the status quo. That is exactly what we are doing here. Let’s disrupt the status quo together.

What makes SmartKargo unique is it was born in the cloud using Microsoft Azure and all the Microsoft capabilities. This may sound like an easy decision today but when SmartKargo initially began there were still client server and legacy systems with a thin veneer of front-end usability for the Air Cargo industry. However, there was no flexibility nor speed for development and deployment. So, the founders of SmartKargo decided to build from the ground up as a cloud solution by leveraging Microsoft Azure. Our product was envisioned, designed, and built on the cloud and inherently leverage all aspects of the modern-day holistic, seamless, and secure cloud infrastructure provided by Microsoft.

We have seen tremendous growth over the last few years and there are two main factors to our success in the Air cargo and small package delivery market. First, we have expertise in all facets of Air Cargo and Small Package Delivery, ranging from Sales, Marketing, Operations, International shipping, and Technology. Technology leads us to the second factor which is our platform. It is flexible enough to wrapper around existing systems and extends all the new products and revenue-enhancing solutions we have in the cloud like eCommerce and Portal.

Microsoft Azure provides SmartKargo and our customers with an ever-expanding set of cloud computing services to meet their business challenges, including the freedom to build, manage, and deploy applications on a massive, global network using select tools and frameworks. The platform empowers our customers to operate hybrid, with an EDI-enabled solution providing seamless visibility between partners—managing environments with tools, apps, and services.

Continuous innovation from Microsoft supports our vision and our customers’ requirements for development today—and supports our product visions for tomorrow by enabling innovation anywhere, across on-premises, multi-cloud, and edge environments, On-premises, in the cloud, and at the edge. We can go anywhere we need around the globe to support global commerce through the air.

We can connect, communicate, and evolve our solutions constantly. We easily connect to the Air Cargo and Small Parcel ecosystem with the Microsoft Azure stack. And this is not a technical proof point but a solution that drives revenue for airlines.

Change is so hard. We often need a big event to help usher in change – a wedding to quit smoking, New Year to lose weight, or saying you will exercise more if your team wins this game! We do this because we are not ready for change and according to Psychology Today- not being ready is one of the main reasons why transitioning is so hard. That confuses me much about e-commerce and small package shippers – they should be primed and ready for change.
The pandemic showed the weaknesses in much of our economy when we were shut down, not to mention starting back up. However, these unprecedented times reflected the tremendous opportunity that e-commerce provides around the globe. E-commerce is expected to be $1 Trillion this year alone. But this exponential growth in e-commerce has also caused supply issues, cascading into shipping delays, missed pick-ups, and contract cancellations by the established shipping players.

Fees are every shipper’s biggest complaint. Many negotiate fantastic rates for their shipping with established players like UPS, FedEx, and USPS – but we know that is not the real cost. Fees like fuel surcharges, weekend delivery, and so many others balloon your price per package and drive shipping costs higher and higher. Moreover, we have heard of the established players raising prices and only giving five days’ notice – very difficult to manage with a partner that may not be that great for your bottom line.

It seems the Vice Presidents and Directors responsible for logistics should be ready for change. There are many reasons you should explore using alternatives to established players. That is the simplicity of our solution for e-commerce and small package shippers – we utilize existing assets to make 2-day delivery a reality across the country. Since we use the existing first and last-mile partners with a major US passenger airline with over 800 flights a day for the mid-mile, we do not need to keep “fee-ing” you to cover their capital expenses. While we are on change, we know sustainability is a factor for all of us. Since we utilize existing assets and use passenger airlines that will fly on their schedule whether the cargo bay is full or not, we help to lower our carbon footprint.

Again, it is not easy to change. Change is not often all at once – I said I would never switch from my Blackberry, and I am now on my 7th iPhone, all it took was the initial iPhone purchase. Start small to make the change lasting because we are coast-to-coast with our airline partner. You may want to start with a small part of your shipments, maybe Atlanta to Los Angeles, which we can do in 2-days, easy. All of you who deal with the establishment know you need some alternatives, so think of SmartKargo as your change agent and better yet, your New Year’s resolution.

I am an avid 49ers fan, the 5-time Superbowl winning 49ers, to be exact. Now I believe their success has been a result of the marriage of offensive innovation and strong defensive commitment – In other words, changing with the times when needed that is how I am seeing the logistics and supply chain business today. I am heading to Home Delivery World in 2 weeks, and I am hoping to see insightful presentations, meet with peers, and visit some of the booths.

First and foremost are companies embracing new approaches, technologies, and partnerships? I have noticed that many of the new companies that entered the logistics market are keen on challenging the status quo. As someone at one of the companies that are creating a new way to deliver small packages across the country, I want to see how interested companies are truly challenging the established logistics players. In my experience, many want an alternative to UPS and FedEx, but it is difficult for many to try new approaches – it is a very risk-averse industry.

Another factor I hope to gain insights into my company and find very important is the customer journey. I find it amazing that even with all the technology in the front office cart abandonment rate of about 70%. Now one of the top 3 reasons for customers leaving their carts are the fees that are charged as part of the checkout process and shipping is one of them. So, how are marketing, sales, and logistics working together to ensure a simple seamless customer experience?

The speed of shipments truly fascinates me because of the “Amazon effect.” All companies are trying to combat Amazon – many of the start-up companies that are driven by innovation are helping to combat that effect. We all know customer want their products as fast as possible and want to match 2-day delivery. Does 2-day delivery the standard we need to meet to make customers happy? And now that Amazon is testing 1-day delivery is the pressure going to be ramped up for all to move even faster? I want to know what my peers think at Home Delivery World.

Innovation is important whether the San Francisco 49ers or a jeans apparel company. Events are important it does provide us a venue to discuss items openly, learn from our peers and see what is going to be possible. And as I am excited to see Chris Grey present “Alternative Delivery Networks” to disrupt and benefit the bottom line in the home delivery world – Chris is the George Kittle of SmartKargo!

I am heading to “Home Delivery World” in about a month and am excited to go to a show that is manically focused on logistics and supply chain. I have years of working with e-commerce, pharma, & manufacturing organizations, that require small parcel delivery and I can never think of a more exciting time in the space. Now when I go to an event I am there to learn and gain insight to connect with my partners and customers!

Now I am very intrigued by the decision to resurrect brick & mortar presence though most large retailers have seen massive spikes in e-commerce purchases. Considering Shopify is laying off workers because they believed that the e-commerce growth would continue, are companies seeing a long-term pullback in e-commerce? Or just a short-term abatement? I am looking to my logistics experts at the show to share their ideas.

Inflation is the issue so many companies are now learning to deal with daily- choosing to raise prices or eat margin will always be a difficult decision. So, I further wonder, are large retailers handling the constant increase in shipping costs without passing the charge off to customers? Many platforms can rate shop, which eases the pain of cost increases. Nonetheless, all carriers are raising costs within weeks, if not days of each other meaning there is no escaping it for the shippers. I never forget that the price of something will always reflect the sum of its cost inputs.

“Necessity is the mother of invention.” This is an old proverb we take for granted but it applies today more than ever. We have inflation, pull forward in e-commerce demand, supply chain issues, workforce concerns, delivery limitations, tremendous growth in surcharges and so many more worries. Innovation is not only needed but paramount for the logistics area. What are new companies doing in technology, last mile, and alternative delivery networks? Moreover, are retailers going to be more innovative? As an example, American Eagle created Air Terra, forcing carriers to start bringing transformation and value to the table. What innovation and value are large retailers and B2B players looking for in today’s market?

I am attending this event with open ears and an open mind. I know some of our partners like Fillogic are revolutionary and technically savvy and will be at the event as well. . We know we are innovative and challenging the norms in the small package delivery space. It is time for a break in tradition and a change of direction. We are a new method…a new way.. that will forever change the face of logistics.

 

I’ve been working for 10 years in Logistics and much of that time was at UPS. I am always amazed at how much innovation is being done in this space – That is why I am so excited about the upcoming Home Delivery World. The depth of the event looks like it will handle all components of the logistics and supply chain industry. I am even more excited since we will be speaking and have a booth on the busy expo floor.

I do have a few specific items I am truly interested in as they impact my world with all the e-commerce, pharma, electronics, and other companies I interact with daily. The easiest is how are UPS and FedEx dealing with their declining delivery performance and how are the market and new entrants taking advantage of this opportunity?

Another piece of information I am interested in learning from the presenters and many of the logistics professionals at the event is accessorial costs and their impact on their business. I look at these fees like the caveats that are voiced over pharma commercials on television or online. They always say something like – “It may cure your migraine headache, but your nose may turn green.” as an extreme example. But think about the list of fees customers need to be very aware of every day – Their shipping prices initially look very reasonable until the customer factors in fuel surcharges, weekend delivery, delivery area surcharge and so, so, many more.

We just had the prime day. And every time there is a prime day each company looks to evaluate their loyalty program, their shipping fees, and the overall “Amazon effect.” Considering Amazon is now the 3rd largest logistics service in the US, I want to understand how logistics leaders are dealing with their internal teams to compete with the 800-lb. gorilla.

I missed events during the pandemic -I get to have direct, fun conversations with professionals with all kinds of experience. More importantly, I learn and ensure I look at this great industry and the innovations that are being built and evolved.

With the exponential growth in e-commerce, it is not just about offering quality products to customers anymore; it is also about e-commerce businesses offering a good experience to a customer’s journey. Right from placing an order to the timely door delivery, this experience plays a crucial role in keeping customer loyalty intact and staying at the top of the game. 73% of all people point to customer experience as an important factor in their purchasing decisions. 86% of consumers are willing to pay more for improved customer experience.

As consumers increasingly rely on online shopping, their expectations for better customer experience also continue to rise, which is why e-commerce customer engagement is critical today. Whether you have just set up an e-commerce business or have been running one for years, you might need to take a closer look at the quality of your customer engagement practices and e-commerce enhancement listed below.

7 ways to Optimize and Improve Customer Service in E-Commerce Logistics:

 

1. Real-Time Tracking

Today’s technology advancement offers all-day tracking in real-time for customers to track their orders, and know about delivery timelines or transit issues. This disruption is not just a boon for consumers but also for e-commerce businesses and logistics providers, reducing costs and saving time.

SmartKargo EDI-enabled e-commerce solution shares real-time information at every step of the supply chain for increasing efficiency. With real-time tracking and reporting, bottlenecks are easily identified.

2. Routing Service

With GPS support, locating a consumer’s delivery location has turned into convenience and has enhanced the overall delivery experience for customers in receiving the packages on time.

SmartKargo uses geofencing capability to improve routing for its drivers to take the most efficient paths to reach the designated locations that benefit in saving cost, energy, and time.

3. Speedy Delivery

Ground-level transportation is hampering the supply chain and customer’s happiness due to bottlenecks such as traffic issues in the cities, delivery to remote areas, the uncertainty of timely delivery, tedious and time-consuming road journeys, etc. E-commerce businesses need to opt for an e-commerce solution that not only removes the bottlenecks of the e-commerce supply chain but also caters to the expectation of customers.

SmartKargo, a unique e-commerce shipping solutions associated with IndiGo airline, gives wings to the middle mile phase and makes it possible to deliver e-commerce packages at a record time of 20 hours timeframe throughout India.

4. Technology Advancement

With an exponential increase in e-commerce sales due to tech-savvy customers, e-commerce brands must stay on top of the ladder of innovation and technology advancement. IoT is one of the technologies that offer to track and streamline the delivery process.

SmartKargo’s IOT integrated solution offers to optimize the end-to-end e-commerce package delivery journey. The AI and ML capabilities enable real-time track and trace functionality cutting down bottlenecks, and making the e-commerce package delivery process efficient, cost-effective, and timely.

5. Better Coverage

To deliver faster to Tier 2 and 3 cities, the e-commerce retailers have to partner with multiple logistics providers increasing nothing but costs for the business.

SmartKargo partners with IndiGo Airline and enables e-commerce packages for a pan India coverage to be delivered in not more than 24 hours timeline.

6. 360° Customer Experience

Consumers today expect an intuitive and easy-to-use digital experience across every communication and sales channel. Brands must focus on delivering engaging Omni channel experiences throughout the customer journey.

SmartKargo acts as a catalyst between the airlines and e-commerce businesses to provide their customers with speedy cargo shipping through real-time visibility, next-day delivery for their customers, and door-to-door service through EDI enablement service.

7. Last-mile Experience

E-commerce delivery is the most complex process of making a product reach the doorsteps of a buyer. It requires the highest amount of attention, assurance, and effectiveness to achieve customer loyalty and retention rate.

SmartKargo enables airlines to track the shipment end-to-end, enhancing the supply chain process, speeding up last-mile deliveries, and offering a fantastic customer experience till the real-time doorstep delivery.

In a world of abundant options, consumer satisfaction should be the yardstick to measure. This is why it’s critical for an e-commerce brand to partner with an e-commerce logistics solution provider for not only the fastest or cheapest delivery but also for additional services like live order tracking updates, real-time customer support, airspeed delivery on ground rates, delightful customer experience, etc. One of the solution providers that tick these boxes is SmartKargo.

Contact us today, for more details: indiaecom@smartkargo.com

 

E-commerce is growing in India both customers and businesses alike have frequently wondered how great e-commerce logistics works, given the phenomenal expansion of social commerce and e-commerce businesses. To develop their business and reach millions of clients, online firms in all genres require continual assistance and partnership with e-commerce logistics suppliers. With millions of customers opting to shop online, an e-commerce business needs more efficient and productive logistics solutions to handle increasing volumes and retain their customers.

Collaborating with a dependable and trustworthy logistics partner is simply the first step for e-commerce companies. E-commerce logistics businesses come in several versions – they help online stores with shipping, packaging, and picking. They also provide a variety of different shipping services that might assist a company in expanding and reaching a wider audience.

 

Indian E-commerce Market Scale Up:

It is no surprise to all as a result of the pandemic that in India, from April-May 2020, a consumer report found that there was already an increase of 11% in first-time online shoppers – 16% in new category online shoppers and 30% in online shoppers with larger purchases in existing categories.

The country’s e-commerce market is estimated to grow at a 30% compound annual growth rate over the next five years and serve 300-350 million shoppers by 2025. The number of e-commerce users is expected to grow by 47% to 948 million users in India by 2025

Facts of the e-commerce Industry in India:

• 46% of the population in India shops online
• According to the analysis, India is the eighth largest market for e-commerce with a revenue of US$63 billion in 2021
• According to a Forbes Report, e-commerce In India Set To Reach $120 Billion In 2025
• According to ITLN, tier II and tier III have a faster growth rate than tier I

 

Rising Importance of Quick Delivery and Fast Logistics in E-commerce:

No matter what the end customer wants their packages fast and cheap. The Amazon effect has many consumers around the globe expecting packages the next day or 2-day delivery.

Most transportation is via ground, it is the primary delivery mode and it becomes the cheapest and the easiest network to establish. But how can fast logistics in e-commerce be achieved via ground only transportation in India? It is an advantage for companies that have more capital. Larger companies equip several warehouses or Distribution Centers (DCs) around India in strategic areas to make sure they meet the customer’s desire for fast and inexpensive delivery.

This means there are increased costs for e-commerce companies on real estate (buy or rental), inventory, insurance, security, and other costs to ensure customers can get their orders fast via ground transportation.

For any e-commerce company the crucial for quick delivery is last-mile delivery. The process of delivering an order from a warehouse (or fulfillment center) to the customer’s delivery address is known as last-mile delivery. In e-commerce fulfillment, the major purpose of last-mile delivery is to deliver an item to a consumer as quickly as possible, making the entire fulfillment process swift and painless. Improving last-mile delivery can now help you provide lightning-fast shipment, resulting in a positive customer experience, and repeat customers.

Furthermore, with speedy shipping options, you can stay ahead of the competition in this overcrowded e-commerce scene by lowering shopping cart abandonment and raising conversion rates. Finally, by enhancing the order fulfillment stage, you may deliver items to customers faster, please them, and encourage repeat purchases.

 

Changing Behavior of Customers:

The e-commerce business has caught up with a significantly more westernized youth seeking new options and prospects. e-commerce is rapidly changing, with numerous new technologies and trends on the horizon. The pandemic forced the offline retail market to close and operate at a reduced capacity. That is why; the pandemic situation became one of the key drivers fueling this expansion, as is the customer’s transition to the internet. Customers now want speed and transparency in the process of delivery.

Future of Commerce Report (India) suggests that 85% of young consumers (18-34 years) and 90% of middle-aged consumers (36-54 years) moved to online shopping during the pandemic. So, brands had to focus on creating digital experiences that met their expectations. e-commerce companies and their customers want a seamless experience to track from the cart-to-the door.

 

Adaptation of Innovations for Indian E-commerce Companies:

The Indian e-commerce market should learn from the US and other more mature e-commerce markets while balancing the uniqueness of the Indian e-commerce sector. How?

• Look for innovation to drive your complete customer journey including your delivery purpose
• Think of ways to reinforce the brand value and meeting the brand promise
• Search for organizations that utilize innovation to shorten delivery time
• Increase ROI by utilizing true value which is not exclusive to just the delivery costs
• Align the following technology and services to the total cost of expansion with multiple delivery options:

 

1. The same day, the Next day, and 2+ days
2. Costs of expansion and DCs by utilizing air options, not just ground options
3. Extend options to customers
4. Ensure technology is integrated into the e-commerce ecosystem, from e-commerce platforms like Shopify to deliver at the customer’s door

 

How SmartKargo can help E-commerce Companies:

Our expertise lies in providing airspeed and ground value to e-commerce companies. We deal with e-commerce logistics across the globe, and we do not believe in a one size fits all market – we customize a solution. We ensure we are a part of the e-commerce company’s growth approach. With Air transportation you can have faster delivery – that’s a given. Our Partnered airline is already going to where your customers are –

We offer other alternatives to spending large amounts on DCs. You may not need as many DCs while using SmartKargo can be said as “Warehouse in the air” and provide fast delivery across the country which is paramount for next day delivery. One of the central issues with DCs is that it always accounts for every product all the time. Air is always fast.

Our innovative technology provides all the aspects from the purchase on the e-commerce engine to the delivery to the customer. Some of our pivotal innovations include:

• AI engine for route optimization for the last mile
• Integration into e-commerce engines out of the box
• Geolocation
• Customer Alerts
• Touchless Delivery
• Real Time insights and reporting

 

Speed and Value are Paramount Factors:

For e-commerce companies their logistics partner’s objective  is to oversee the pick-up, and successful delivery of all orders placed with them. However, in the case of e-commerce logistics, the breadth of services is much broader. To be the most efficient, e-commerce logistics businesses must make use of the most recent technical breakthroughs.

Simply delivering the product isn’t enough in e-commerce because it serves such a broad number of demanding and eager clients. Customers expect to be able to easily track their orders and receive timely information from the e-commerce shop where they made their purchase. Proper inventory, order generation, tracking, NDRs, and returns management systems can ensure that your logistics partners make the entire process transparent to you and your consumers.

E-commerce logistics providers should ensure your customer’s journey is aligned with your brand and its brand promise. Look for those innovative companies that will extend your brand and provide the insights and analytics needed to keep you customers coming back.