Air Cargo - Research Paper Example

Air Cargo Research Paper Air cargo involves in movement of goods and services from one place to another. The choice for this service by client is made to achieve efficiency when handling perishable and highly precious commodities. The airline companies aim at increasing their income by charging high fees on those goods which are highly perishable or precious. To make their activities highly efficient, they ensure improved safety, efficient equipments and experienced staff. However, to achieve this will result to additional expenses, which may result to decline in their income. 1. Introduction Air cargo refers to airliners which are designed to ferry consignments from one point to another. Efficiency in the handling and regulating movement of merchandise, power, passengers, services and products is very crucial as they are moved from the point of supply to the point of requirement. As business activities continue to expand globally, proper regulation of shipments will result to efficiency in trading activities. It will also improve production activities due to availability of factors of production on time (Elias, 2010). The trading activities will expand due to ease of marketing of commodities as a result of market expansion. Coordination of airline transportation will incorporate information, movement of goods, passengers and services; stock taking, monitoring of raw materials and wrapping of manufactured commodities (O’connor, 2001).The fees charged on merchandise will vary depending on the potential for airline to ferry up to its capacity. This will also influence demand for the aircraft services since it will result to biasness by the airline operators. Airline operators keep on changing the charges for the merchandise from time to time as demand varies overtime. There is an issue of protection when it comes to movement of goods or passengers thorough the air. This also plays a pivotal role in determining the revenue amount raised by the companies (Elias, 2010). In most cases, busy destinations such as airports are the targets of terrorists and could influence income and demand for airline services (Molotch, 2012). The airline companies are usually faced with challenges when determining the capacity of their carriers for different classes of merchandise of varying categories to be transported in order to maximize their revenue. Air Cargo Economics, Pricing and Demand Shipment of goods and passengers by airline is dependent on their weight. This is because airlines have a limited capacity in terms of weight which determines the amount of goods and passengers a particular airline can carry at a given time (Elias, 2010). Although some airliners deal with either passengers or goods alone, most of them will combine both passengers and merchandise. When determining charges for the airline services, commodities are valued according to their weight, durability and urgency. Similarly, passenger airliners determine the fees charged on their travelers depending on the status of the passengers such as economy, business and common class (O’connor, 2001). Even though the seats for each category of travelers are definite, it is always influenced by heaviness of the passengers and therefore, airliners may never have all its seats fully occupied due to weight variation of the passengers (Elias, 2010). Also, the merchandise of each category will vary in bulk and weight. Therefore, this will affect the quantity for each category to be shipped from one destination to another. Carrying an additional weight of travelers of merchandise will result to extra cost because the airline will require additional power to lift up the additional load. The airliner companies normally apportion available capacity to each category of goods or passengers. Those who request booking late are charged higher than normal rate (Elias, 2010). Due to this reason, airliners have varying income resulting from their different charges for their services. Also, the space utilization will differ across the carriers. Companies can maximize their revenue by shipping more of durable, less bulk and lighter commodities from one point to another (Doganis, 2002). However, in most cases those who transport perishable commodities prefer airline due to high speed. On contrary, those commodities are more bulk and dense hence may affect profitability of an airliner. For the airline companies to be able to maximize their revenue from their activities, they offer specialized services to their clients in the most effective way (Elias, 2010). They have well trained staff to handle commodities of different sizes and value more efficiently. The staff should be table to balance the demand and valuation of their services from time to time to ensure highest return is obtained from their activities. The process of balancing between the merchandise to be shipped and the income to be attained is tedious and time consuming. It is not easy to predict the exact income to be raised for each trip made since it is dependent on the number of factors such as value of the goods to be shipped the weight of the merchandise. It requires expertise to work out the level of each category of merchandise and travelers to be carried by in each trip to rip maximum benefit. These results to additional cost for hiring experts hence reduced earnings for the airline company. The demand of airline services is influenced by the level of safety and cost of transporting those commodities (Molotch, 2012). Therefore, setting charges for some commodities high may result to decline in demand hence a decline in revenue raised by the company. Air Cargo Terminals, Equipment, Management and Operations The airliners have special equipments for handling goods and passengers from the time they make bookings, to arrivals at the terminals and their movements to other ports of destinations (Elias, 2010). This also involves regulating the quality of the commodities to ensure that goods are shipped to their destinations in a superior condition without losing their value. Different class of merchandise is handled separately and in accordance to special care needed for each category (O’connor, 2001). At the airports, the airline companies have proper storage facilities for various commodities. Arriving and departing goods are handled separately to ensure smooth process of handling those commodities (Elias, 2010). The storage facilities are designed for different goods depending on their nature. This ensures efficient performance of the company crews as way of maximizing revenue. Loading and off-loading of carriers is done through automated facilities which ensures efficiency in operation hence increase in income for the companies. Finally separate products are handled separately. For example poisonous goods are handled separately with special facilities to ensure that they do not contaminate other products. Airline companies ensure they handle their clients with due respect to establish customer loyalty. Also, they keep in touch with their clients through different communication channels such phone calls, online communication, or by use of facsimile (Elias, 2010). Efficiency of an airliner will be determined by the level of expertise of the staff members, equipment for handling all the necessary processes and structuring of the operations (Doganis, 2002). On the other hand, these equipments will result to increase in cost of operations. Consequently, this will result to decline in income generated by the companies. Air Cargo Security Threat of an attack of airlines is mainly masterminded by the same people who are involved in the operation or shippers themselves. Sometimes dangerous weapons or explosives are packed with consignments being shipped (Molotch, 2012). This depicts need for thorough scrutiny of the consignments to ensure safety for airline staff, aircrafts and clients consignments. Shippers have no influence on the course which will be used by air cargo (Elias, 2010). Although most of the commodities shipped by air are highly valuable and prone to terrorist attacks, the coordination of shipment routes are determined by forwarders hence shippers may not be able to affect a particular region since they have no information about the direction airlines will use (Molotch, 2012). However, thorough scrutiny is currently being undertaken at the airline terminals to ensure total safety for both travelers and their goods. Special facilities for detecting explosives and other dangerous weapons are available at the port terminals to ensure safety of everyone involved in flight operation (Elias, 2010). To scrutinize all goods and travelers for safety of the travelers and commodities results to an additional cost to the company. This is because more sophisticated apparatus as well as personnel are required to ensure total safety for airliners. Increase in cost of investigation will reduce income for the companies. It also results to decline in efficiency since it will require more time to complete investigation procedure. Conclusion Proper management of airliners will ensure proper handling equipments, experienced staff and safety in the entire shipping process (Elias, 2010). This will ensure maximum revenue for the companies. However, this is influenced by staff potential to balance the between different category of the consignment to be shipped from time to time. It will also be influenced by level of safety as well as equipment used in handling the consignments (Doganis, 2002). However, using more sophisticated equipment, experts and stringent safety measures will reduce their income. This may reduce the amount of revenue earned by the airline companies. Reference Elias, B. (2010). Screening and Securing Air Cargo: Background and Issues for Congress. Congressional Research Service Doganis R. (2002).3rd ed. Flying off Course: The Economics of International Airlines. London: Routledge Molotch H. (2012). Against Security: How We Go Wrong at Airports, Subways, and Other Sites of Ambiguous Danger. Princeton, NJ: Princeton University Press. O’connor, W. E. (2001). 6th Ed. An Introduction to Airline Economics. Westport, CT: Preager Read More