Report: Main Factors Supporting Air Cargo Development in the UK

This report analyzes the main factors contributing to the development of air cargo in the United Kingdom. It examines the influence of economic conditions, highlighting how the UK's economic situation directly affects the demand and pricing of air freight services. The report also explores the significance of premium and value-added services, such as express delivery and special handling, as key competitive advantages for air freight carriers. Additionally, it discusses the role of time and temperature-sensitive cargo, emphasizing how the ability to transport such goods efficiently is a crucial factor in air cargo development. The report references various sources to support its findings, providing a comprehensive overview of the key drivers in the UK air cargo market.

Running head: LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Logistics and Supply chain management

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Table of Contents
Analyse the main factors helping air cargo development in the United Kingdom..........................3

LOGISTICS AND SUPPLY CHAIN MANAGEMENT 3
Analyze the main factors helping air cargo development in the United Kingdom
Economic Conditions
Economic situation of UK nation can directly affect the demand and supply of a product and also
it can directly influence the pricing decision of company. This factor also affects the
development of air cargo. In UK, demand for air freight facilities is higher and this fact can lead
to higher rates of services. At the time of economic downturns, demand can decline particularly,
in low load factor routes. In addition to this, prices of carriers are declining to fill up space
because if it would not be declined, it can be unused. IATA has published the airline business
confidence index in April 2015 and it is highly dependent on that past correlation (Leading UK
logistics, 2019). The report illustrates that volume would continue to increase in the upcoming 1
year because of increase in economic growth and business confidence in United Kingdom.
Moreover, carriers should be ready in order to promptly respond to degrading the economic
circumstances. Lowering standard rate is significant factor for development of air cargo.
However, there are other approaches like assessing surcharges, optimizing routes related to fuel
efficiency, declining flights, and integrating routes for partial loads that can helps in
development of air cargo in UK (The strategic view, 2019).
Premium and Value Add Services
One of key competitive benefits of air freight over sea freight is competency to provide premium
facilities at the maximum rate. Air freight carriers have competency to develop tiered pricing as
per the services such as express delivery, special handling, packaging, shipment tracking, as well
as door to door services. It also requires special handling named as human remains, food with
short shelf life, hazardous resources as well as human remains (IBIS world, 2019). Along with
this, cargo-only carriers get benefits by developing the understanding about the exact capacity.

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The freight capability for passenger flight, which carries belly cargo, can fluctuate as per the
number of passengers together with, amount of luggage they have. Hence, integrated carriers can
provide prioritization to shipment as a premium service. Consumers can pay higher service
charges to make sure that their shipment increases to front of the line in the event of deficit in
competency (Cederholm, 2019).
Time and Temperature-Sensitive Cargo
Sea freight is essential factor which help in air cargo development in the United Kingdom. Sea
freight is only alternative to ship a product, which needs temperature controlled atmosphere
whereas air cargo is a method of selection for a shipper with minimum lead times. But, the
growing existence of temperature-controlled, ULDs is transforming due to dynamic as well as,
creating a new consumer segment related to air freight carriers (Leading UK logistics, 2019).
Moreover, customer’s products could be temperature-sensitive as well as, time-sensitive. In
contrast to this, lengthy shipping times in relation to delay in air cargo facility can close the gap
among sea freight as well as, air freight. The average delivery duration related to six days cannot
provide some consumer enough of advantageous to justify the expenses. Along with this, a
robust cargo management strategy can be used to develop the available electronic
documentation for everyone who has its immediate requirement (The strategic view, 2019).

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References
Cederholm, T. 2019. Cargo traffic and capacity. [Online]. Available at:
https://marketrealist.com/2014/09/must-know-key-drivers-air-cargo-growth/ (Accessed: 23 May
2019).
IBIS world. 2019. Freight Air Transport - UK Market Research Report. [Online]. Available at:
https://www.ibisworld.co.uk/industry-trends/market-research-reports/transportation-storage/
freight-air-transport.html (Accessed: 23 May 2019).
Leading UK logistics. 2019. Helping air freight delivery. [Online]. Available at:
https://fta.co.uk/air (Accessed: 23 May 2019).
The strategic view. 2019. Aviation, United Kingdom. [Online]. Available at:
https://www.strategicview.co.uk/strategic-view/aviation-law/the-strategic-view-aviation-2017/
united-kingdom (Accessed: 23 May 2019).