Analysis of the Emirates Sky Cargo Business Model and Operations

This report provides a comprehensive analysis of the Emirates Sky Cargo business model, exploring its role in the international supply chain and global air cargo operations. It examines the company's strategies, including its combination business model, dedicated cargo network, and utilization of freighter aircraft. The report details Emirates Sky Cargo's passenger network, operational hubs, and the importance of freighter aircraft in its business. It also discusses the company's approach to market expansion, customer engagement, and its use of blockchain technology. Furthermore, the report highlights the dynamic nature of the air cargo industry, the impact of e-commerce, and the factors influencing competition. The study emphasizes Emirates Sky Cargo's commitment to providing tailored transport and logistic services, making it a key player in the global air cargo market and its contribution to the overall growth of the world economy.

Running head: AIR CARGO BUSINESS MODEL
Air Cargo Business Model
Name of the Student
Name of the University
Author Note

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Introduction
Emirates Sky Cargo is one of the best air cargo services and it is mainly based in
Dubai, United Arab Emirates. From the data of 2019, it is reported that, Sky cargo of
Emirates Airlines is the second largest cargo airline service of the world in terms of total
freight tonne-kilometres flown. Along with this, the company holds the first position in terms
of being the largest air cargo service in terms of international freight tonne-kilometres flown.
The Emirates Sky Cargo is the air cargo service of Emirates group of airlines services. The
service was initially started in 1985 and initially the service was operated through the AI
Maktoum International Airport that is the primary division of this air cargo service.
Moreover, the Emirates airlines also operates the freighter aircraft as a part of their business
(Baldwin 2016). As a part of their business operation in the world in terms of cargo service
and passenger service in different countries of the world is basically based on their
perspective that mainly focuses on the Emirates’ commercial success. The main component
of the business of Emirates are associated with the lean work forces and the low- cost carrier
of the company. Apart from that, it is also true that the company follows a general and flat
organizational structure in order to maintain the low costs of the services provided by them
(Merkert and Alexander 2018).
In this, essay the business model of Emirates’ Sky Cargo and its role in the
international supply chain are discusses. Apart from that, the passengers’ networks of the
Emirates, business process of Emirates Sky Cargo, and the factors involved in the business
process of Emirates Sky Cargo are also described in a brief manner.
Role of International Air Cargo Mode in Supply Chain
Along With the development of technology in the world, the mode of supply chain of
the products are also changed as the air cargo business has captured a huge amount of market

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place in the world of business. According to the study of Baxter (2019), it is reported that, the
air cargo plays a crucial role in the global business trade and it is reported that, air cargo
services are associated with the 35% of transportation of the products in world. Although, the
Heathrow Airport is not considered as a global trade hub, still most of the products of the
London area is transported through this airport. The air freight service of Germany is alone
responsible for the 30 percent of total transportation of the materials. While analysing the
global context of the air cargo services, it can be easily said that this industry is very dynamic
in nature and is also increasing in a rapid manner. Therefore it can be said that, due to the
growth of the air cargo services in a worldwide manner, the economy of the world also starts
to increase and the emerging middle class country’s growth also promote the increment of the
air cargo services of the world (Lim 2018). Along with this, the enhancement of the
ecommerce services in the middle income countries of the world also promote the growth of
the air cargo services of the world. While analysing the inter modal competition of the air
cargo services, it can be said that the intermodal competition of the air cargo is dependent on
the quality of services rather than the volume of the services provide by them (da Silva 2014).
Due to the enhancement of the air cargo services, the transportation of the products
become easier and for a company or business body, it is very important to deliver their
product in a less amount of time. The use of air cargo services in the world business, also
help the companies involved in the international business to deliver their product in a quick
manner. As a part of this, it is also reported that the use of air cargo services in the modal
business also make the air cargo business easier. It is quite evident that , every company
wants to deliver their product to various countries of the world and transportation time of
the products also encourages the business personnel to use air cargo services as the air cargo
service consume less time than any other transportation facility (Sales 2016).

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Air Cargo Business Model
The air cargo services of Emirates named Sky Cargo mainly follows a combination
business model strategy in their business process. According to the study of (), it is reported
that the airlines companies involved in the air cargo services mainly follows a few business
strategies. Among them, Basic Service Freighter (BSF), Full Service Freighter Operator
(FSFO), Basic Service Combination Carrier (BSCC), Full Service Combination Carrier
(FSCC), and Separate Profit and Loss Full Service Combination Carrier (SFSCC) are mostly
used by the airlines companies. From the various studies, it is reported that, the cargo airlines
business groups generally takes decision based on the passenger business and it is quite
evident that the cargo facilities are the secondary operations of the airlines companies.
Therefore, the cargo service of the Emirates Airlines are also not all different from them
(Reis and Silva 2016). Combination services provided by the airlines companies generally
comprises of a basic range of services or products such as tracking and tracing of the goods
delivered through cargo services, custom clearance services which is mainly sold by the small
sales teams. Along with this, the airline cargo services also can work in a joint venture along
with other airline companies of the different countries of world. Although, the cargo service
provided by an airlines company is a completely different wings of the airline business still it
is based on the passenger aircraft services of the airlines companies (Sales 2016).
The Full service Combination Carrier (FSCC) Strategy mainly provide midrange
product differentiation along with the services used by the professional sales team. The
combination airlines in this category generally operated by the passenger service of the
airlines company and the cargo products are loaded in the belly of the passengers’ air craft
and the products are delivered to the destination by the passengers’ aircraft. Along with this,
it is also evident that, in case of specific cargo routes, ad-hoc chartered freighters may be
hired by the companies (Reis and Silva 2016).

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The Separate Profit and Loss Full Service Combination Carrier (SFSCC) is another
strategy that is used by the cargo airlines. In this strategy, the combination airlines generally
focus on the huge commitment towards this cargo business. The selected company Sky Cargo
by Emirates, follows this Separate Profit and Loss Full Service Combination Carrier
(SFSCC) strategy as they are capable of providing a huge range of services such as
warehousing, tailored transport and logistic services, and intermodal freight transport services
to the consumers (Reis and Silva 2016). The Sky Cargo service provided by the Emirates
generally involves in a dedicated cargo network services in the market and they generally
operates as per the needs or requirement of the market in a worldwide manner. Along with
this, it is also reported that in case of combination system, most of the airline companies are
dependent on the mother companies as well. The Emirates Cargo services, also take steps as
per the market requirement and as a part of this, they also hire dedicated air cargo services
whenever there is a market requirement. Therefore, it is reported by multiple researchers that
the air cargo services in the aviation market invest according to the regions that is the
company invests most to that region in which there is huge requirement of the cargo services.
As a part of this, they also concentrate on those market places which are not at all exposed in
terms of cargo market and as a consequence of this, there is high chance to get more revenue
from that particular market as there is a lack of adequate competition in the cargo market
(Merkert and Alexander 2018). Along with this, use of such strategies will also help the Sky
Cargo of Emirates to explore the passenger sector of that market as they will initially initiate
the cargo service along with the passenger service through using the belly of the passenger
aircraft. This cargo model of business imported by Emirates in the market will also help in
the expansion of the existing business in the market place in terms of increasing the target
customers, generating more revenue from the market and simultaneously this will help them
in combining with more local companies as well. As a part of this, the Emirates Sky Cargo

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generally uses the block chain business model as a part of their combination business model.
In this business model the primary focus of the Emirates Sky cargo is on the customers in
terms of reducing the price for their customers through the process of negotiation as well.
Moreover, the Emirates Sky Cargo is directly engaged in the interaction process with the
customers and thereby causes the enhancement of the customers’ base, business credibility in
the business market of the air cargo services (Zhang 2016).
Emirates Sky Cargo: Global Air Cargo Operations
From the official website of Sky Cargo Emirates, it was observed that the company is
one of the primary players of the international air cargo market of the world and moreover, it
is reported that they are operating in 50 different destination through their air cargo services
and on the other hand, they are operating to 100 different destination by their Emirates
Passenger Network (al-Mehairi 2016). The Emirates Sky Cargo operates through the
dedicated cargo flights to the various countries of Europe, Asia, Africa and various countries
of America as well from its hub at Al Maktoum International Airport. Apart from those
regions, Emirates also provides cargo services to 9 destination where there is no passenger
aircraft services of Emirates is available. Along with this, the Emirates also provides cargo
services to those destination where they provide passenger services through passenger aircraft
(Budd and Ison 2015).
Emirates SkyCargo Passenger Network
As per the report of 2018, it was reported that, Emirates provides their air services to
161 destinations in 85 countries in various continents of this world as a part of their passenger
services and all the passenger services mainly operates from the primary hub of Emirates that
is Dubai. However, it is also reported that, this airlines group has strong presence in most
number of airports in the countries of the South Eastern Asia and in the countries of the South

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Asia as these regions helps in the connecting process of various other international countries
of world. While analysing the country wise services of the Emirates airlines passenger
network, it is reported that in US, there was almost 12 airports and in India is in the second
position along with 9 air ports in the country (Emirates 2019). Therefore, in UK and
Australia, Emirates operates in 8 airports and in Pakistan there are 5 airports in which
Emirates provides their service.
Source: (Emirates 2019)

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Role of Dedicated Freighter Aircraft in Business
Freighter aircraft is specifically designed for carrying huge amount of goods and due
to the highly controlled transport facility, direct routing system, unique capacity to carry
volume, weight of the product make this freighter aircraft crucial for the air cargo business
(boeing.com 2019). In case of Emirates Sky Cargo, it is reported that, since the initiation of
the air cargo services of Emirates, they had 13 Boeing 777Fs in their fleet and recently the
company had welcomed the newest Freighter aircraft in their fleet making the total numbers
of freighter aircraft to 15. In their fleet they also have two Boeing 747-400Fs along with 13
Boeing 777Fs. According to an official of Sky Cargo, it was reported that, due to the use of
the freighter aircraft in the business process, Emirates is able to transport goods in various
remote location and this also helps in the revenue generation of the company by enhancing
the customer bases of the company. Moreover, continuous improvement in the fleet of
freighter aircrafts of Emirates also promoted the company to open new routes in the cargo
division of the company (Businessme.com 2015).
Services provided by Emirates in Global Air Cargo Market
In the international air cargo market, the Emirates Sky Cargo contributes a lot by
offering services like general cargo, post office mail services, couriers services,
pharmaceutical services and vehicle transportation as well through the air cargo services of
Sky Cargo (Emirates 2019).
Air Cargo Traffic Volumes and Its Financial Importance
From the report of the Emirates Airlines, it is reported that, Emirates airlines is the
world’s largest international air cargo services by using the freighter aircrafts and they carries
more than 45000 tons of cargo in each week that comprises of clothing, textiles , perishable

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foods; ,Formula 1 racing cars, concert equipment and pets as well (Emirates 2019). Along
with this, the Sky Cargo also started cool-chain area in their new hubs and through this they
handle almost 140,000 tonnes of perishable cargo to the various region of world. From the
financial report of the Emirates, it was reported that in the year of 2018-19, Sky Cargo carried
2659000 tonnes of cargo. Sky Cargo contributed almost 14.2% of total revenue of the
Emirates and in the year of 2017-18 this contribution was almost 14.3%. In the current
financial year, the belly capacity along with the carrying capacity of the cargo freighter
aircraft was enhanced and the airlines company also expanded to Bogota, in Columbia and in
Iraq as well. The consistence performance of the Sky Cargo service of Emirates contributes
to the good positioning of the company in the financial market of the world. In the 2018 -19
year, the company has the total assets of almost 127.4bn (Emirates 2019).
Source: (Emirates 2019).
Factors Influencing the Air Cargo Business
There are a few factors that can contribute to the air cargo business of the Sky Cargo.
As a part of the positive factors that have contributed to the business of Sky Cargo, it can be
said that the joint venture initiatives with other airlines will help them in enhancing their
business process in the air cargo market (Dresner and Zou 2016). Such joint venture of

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Emirates can help them in spreading their business in remote areas of the world as well.
Apart from that, technological improvement will also help the company to enhance their
business as well. As a part of the negative point, it can be said that, the presence of other
renowned cargo services in the market of air cargo services can be marked as a negative
impacting element of the air cargo market (Eraky 2017).
Conclusion
Therefore, it can be concluded that, the Sky Cargo of Emirates is one of the largest
players of the air cargo market of the world and they are performing in a very well manner in
terms of gaining revenue from the market. By using the freighter aircraft such as Boeing
777Fs along with the passenger’s aircraft for delivering goods to the different parts of this
world also help them in spreading their business throughout the world. The combination
business model along with block chain structure helps them in running their business in a
good way.

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