Footing the bill: Who’s going to pay for our pricey standards?

BUDAPEST – Without unifying standards, airfreight will remain fragmented, leaving carriers, forwarders, ground handlers and everyone in between vulnerable to disruption – and shelling out big bucks to navigating multiple communications and tracking standards, according to speakers here at this year’s Air Cargo Handling Conference.

“If we really want to move the industry forward, IATA needs to step up,” said Marcel Fujike, senior vice president of products and services, global air logistics, at Kuehne + Nagel, garnering loud applause from the conference’s audience.

Heading into the final afternoon of four days of back-to-back panels, presentations and networking events, the topic of standards (or lack thereof) injected energy into a timeslot that most executives use to catch up on their communications and surreptitiously surf social media.

In Fujike’s opinion, IATA’s CEIV certification process is too expensive for small forwarders to afford , so few of them are able to get on board. Without the thousands of smaller forwarders, CEIV standards won’t become industry standards, he added.

Nils Pries Knudsen, CCO of Swissport International, noted that the absence of industry standards was something that Swissport contends with on a daily basis. “We have to deal with a very fragmented industry, and many forwarders aren’t as automated as K+N and the like,” he said. “We should do more to get the industry standards widened to address these shortcomings.”

But while it’s easy to point the finger at IATA – which, in all fairness, has assumed the task of industry oversight and advocacy – it’s a bit more complex than simply making accreditation cheaper. The panelists agreed that the aggregate airfreight industry also had a responsibility to pick up the slack. “Nothing comes for free,” said Nick Careen, IATA’s senior vice-president of airport, passenger, cargo and security. “For IATA, it’s like herding cats around the supply chain,”

Careen added that there are no shortages of regulated practices and standards, but they aren’t mandatory. “There are costs associated with them,” he said.

Take radio frequency identification (RFID), for example, where no standards exist as of yet. “If we listen to everyone’s demands, our warehouses are plastered with different scanners and readers,” said K+N’s Fujike. Getting the industry to adopt one standard for RFID would solve that problem, but bringing everyone on board is a problem that has not been solved – yet.

All this has the industry asking itself, where will leadership on this issue come from? There’s no magic bullet on the horizon, but there are indicators worth examining in more depth. Steven Verhasselt, commercial director for Liege Airport, noted that “the way to achieve it [standardization] is to increase transparency.”

With everyone’s operations open to examination, perhaps some combination of exposure and analysis will illuminate the most problematic areas in airfreight, and promote improvement towards a universal standard.

To learn more about future innovations in freight forwarding, air freight and logistics, join us at Air Cargo World’s ELEVATE Conference in Miami, Oct. 2. Click here for registration information.