The agility and quick thinking of GSAs has kept cargo moving through uncertain and turbulent times. Stephen Dawkins, chief executive officer, Air Logistics Group; Zafer Aggunduz chief marketing officer, Global GSA Group; and Ingo Zimmer, CEO, ATC Aviation Services spoke to ACW about how the unsung heroes of the past year have ensured goods got from A to B.
ACW: With uncertainty surrounding capacity, routes and staff, how have GSAs had to adapt throughout the pandemic?
Dawkins: The last year has been challenging for everyone in the industry and for GSSAs it has highlighted the requirement for us to continually evolve. Air Logistics has continued to invest during these challenging times, by adding value where we can and easing the pressure on our Airline Principals by assisting our forwarding clients with especially demanding service levels. In the current climate capacity is scarce and GSSAs need to provide high quality solutions for their forwarding clients.
Air Logistics is focussed on enabling our teams with the right tools to realize efficiencies that enhance sales and yields for our Partners.
The pandemic highlighted the importance of our continuous investment in our network, IT infrastructure and digitalising our processes to provide faster quotations to our client base of over 16,000 freight forwarders worldwide.
Around the world the impact of COVID-19 was swift, Air Logistics teams had the tools & systems (communications / financial / operations / business intelligence) in place to work directly from home immediately, ensuring swift and efficient communication with our Forwarding and Airline clients.
Aggunduz: The air cargo industry is already a fast paced industry. Everyday is different so our teams already have the experience to cope with challenges and so they are able to act fast.
For Global, the most important thing was the safety of our people, so we took measures in each country to see what we needed to do to keep our staff safe and abide my each country’s rules and regulations.
Everyday was an uncertainty. We were not able to plan ahead in regard to rates and capacity. The main solution for us was to have daily communication with airlines and agents.
When you have this kind of uncertainty, there is also a lot of opportunity that arises. We had to be creative to take advantage of opportunities.
For example, we have a company called ChartAir Cargo. A few years ago we started this as there was a gap in the market and we try to act as a broker as we
receive a lot of requests from the market that we cannot act on with the portfolio that we have.
Zimmer: As a consequence of the pandemic the capacities on passenger flights dropped significantly. In order to cater for the demand we decided to offer charter services in addition to the GSSA segment. Volker Dunkake had been appointed to head our Charter and Solutions team.
Volker has a broad experience in the charter business and before he joined ATC he was part of the Lufthansa Cargo Charter management. At the beginning of the pandemic the focus of the new department was on pax freighter charters exporting masks, gloves and ancillary equipment from China into destinations everywhere in the world. About 100 charters had been handled to Europe, Africa and South America.
At the same time a COVID Task force has been put together. Thomas Baumert, a veteran in the Pharma business, and his team analysed the situation, talked to the concerned stakeholders in the logistic chain and offered solutions to our customers.
Beside pax charters the solution team started to sell unused capacities from agent charters. Our group did set-up own charter chains into the USA.
ACW: Do you think the role of the GSSA has changed during this time? Why?
Dawkins: During the pandemic airlines have been downsizing or parking their fleets and reducing the number of flights they operate. With this reduced activity, Airlines are having to make the difficult decisions to furlough or reduce head count and as such working with an outsourced cargo provider makes sense until the market returns, we all anticipate in 2022.
Air Logistics Group offers more than just a selling solution – it provides additional administrative & back-office functions, IT & business intelligence solutions, alongside experienced sales and customer service teams.
Any or all of these services can be selected by our airlines to ensure their cargo operation runs smoothly and provides a vital revenue stream during these challenging times in our industry.
Aggunduz: I think going forward it will definitely change. In this period all the carriers who had offices outside their own country had difficulty complying with the differing regulations.
As a GSA we have 20 or 30 years experience and with that comes strong relationships. We know the agents by heart and we have personal relations with them as well as knowledge and expertise of the market.
As a GSA we have various airlines, so we were able to take advantage of the buying power we have. We were also able to support the carriers we have in their portfolio as a lot of carriers cancelled some routes but in order not to lose the business we were able to book it on other carriers.
Zimmer: During COVID, we changed slightly into the role of a capacity provider and were forced to offer solutions. Not only selling scheduled carriers capacities because these capacities were insufficient for the airfreight demand.
ACW: What is the key to being a successful GSSA?
Dawkins: The key to being a successful GSSA (not just a GSA) is adding value. A GSSA is about so much more than just selling space.
Airlines are looking to maximise revenue and a competent GSSA can deliver on this – be it administrative efficiencies, liaising with handlers or using its network to find feeder opportunities into an airline’s hub.
Alongside these value-added services we must continue to provide the highest level of service to both our airline and forwarding clients.
Aggunduz: GSAs worldwide are doing the same thing. But you can do it in a passive way, you can simply execute the tasks, or you can be more proactive and create business and find solutions. That’s our motto, create business and find solutions, and that’s the key success. With us, we’re dedicated and solution-minded and have a proactive approach for sales.
In this kind of period you need to have trust to steer the airlines in the right direction. I think that’s when you can really make a difference. It’s based on trust though and that comes with time.
Zimmer: The key is still the network and market and product knowledge. So to have the best sales team in front and a well-organised back-up team is very important.
All our managers are hand selected, the best in the industry. We have specialists for pharma, live animals, charter, automotive and even for the OBC business.
The back office has got to be lean and cost efficient in order to make us competitive in pricing. Here it’s the grade of digitalisation, which makes the difference. In ATC we work with bots transferring e-mails in bookings and copying data from our to the airline system. No more double entries. We are all working with windows 365, a cloud based system. Our reservations software COS is brand-new and state of the art and has been successfully rolled out in 2020 to all our global offices. The e-booking platform has been started recently for bookings and ad hoc requests.
ACW: How do you hope your GSA will develop and grow going forward in to a post-COVID world?
Dawkins: Enhancing our digital tools and platforms has been a key element of our strategy during the pandemic and in 2021 we will be realising a significant value-added platform tool allowing airlines to revenue manage their business on a shipment-by-shipment basis if required.
Alongside its digital developments, Air Logistics understands that every shipment is different whether its high value or temperature-controlled pharmaceuticals, and we need to take a booking and ‘own it’ until it gets to its final destination. In addition, we still have local people at the end of the phone to support our forwarding and airline clients throughout the process.
Aggunduz: During this time we have really shown the market the value of GSAs and the positive effect it can have on business. If you look back to the statistics, the carriers have performed against all odds. In many countries some of the airlines that have performed best are represented by us, so that gives us the confidence to say that we really made a difference.
Post-COVID the need for data, communication, and efficient tools is becoming a big trend in the cargo industry. At Global we are investing in information technology to create IT that is applicable for GSAs in order to optimise the supply chain.
But everything cannot be digital, there will always be some personal influence. The air cargo industry is still a people business and still requires a lot of tailor made solutions. We’re investing in IT to find tools that are effective but we are still able to apply our bespoke solutions, our knowledge, our expertise and personal influence to give customers the personal attention that they need.
Zimmer: We see a lot of potential for GSSAs because the airlines learned during the pandemic that it is good to be lean and outsourcing business at fixed costs to a GSSA is a good solution.
We expect that the rates will drop a bit when capacities come back but will stay at a healthy level for the next years.
After having built up a strong presence in Europe, USA, Canada and South America our focus is now on Asia. In Asia we recently set up offices in India, Hong Kong and Korea. This will expand with time.