SEATTLE — After more than a decade of stubbornly holding onto paper, air cargo carriers and freight forwarders of all sizes are finally realizing the benefits of going digital with e-airway bills (e-AWB). The underlying theme of yesterday’s eAWB360 session, hosted by IATA’s Cargo Network Services (CNS) in Seattle, was that e-AWB implementation is no longer out of reach for small and medium-sized forwarders, and that the time has come for even the smaller players to get on board with the initiative.
On Sept. 1, up to ten airlines will switch over to e-AWB as their preferred method of shipping air cargo at Seattle-Tacoma Airport (SEA). SEA will become the latest airport to embrace e-AWBs, and San Francisco will follow soon after. As a pillar of eAWB360, CNS gathered members of the local air cargo community to discuss the challenges and benefits of turning off the printer.
The initiative supports IATA’s lofty 2017 target of 62 percent for e-AWB penetration—far-off from the current global penetration, which stands at 50.1 percent. Carmen Alvarez, CNS’ manager of industry projects, pointed out to session attendees that although e-AWB penetration has seen strong year-over-year growth from 39.6 percent in July 2016 to the current 50.1 percent, most of that growth occurred during 2016. Penetration levels have been mostly flat through 2017, as large network forwarders and many carriers have already joined and are using e-AWB for at least some routes. Smaller forwarders, however, have been reluctant to make the switch.
For forwarders, the challenges of switching from paper to e-AWB are outweighed by the benefits, said Laura Sanders (pictured), vice president of carrier relations and customer experience for Lynden International. Some of those challenges are inevitable for early adopters, as some carriers and destinations have not yet joined the e-AWB program, and those that have do not always clearly indicate which routes are compatible with the program. And, of course, there is always some resistance to any change as people hesitate to move away from what they know — particularly when doing so requires an up-front investment.
Lynden, a Seattle-based forwarder that Sanders described as “on the smaller side of medium,” required an up-front investment of about US$53,000 in IT costs, she said. However, the savings gained through the program covered the company’s investment in just over nine months. On top of lower costs for paper forms and courier fees, the improvement in data accuracy, access to information for involved parties and a better overall customer experience made the switch to e-AWB worthwhile for the forwarder.
In the past, forwarders placed much of the blame for their unwillingness to go digital, on the unpreparedness of airlines. A prerequisite to going digital, is that both carriers and forwarders sign on to IATA’s Multilateral e-AWB Agreement. For forwarders with branch offices scattered around the globe, both parties must ensure that particular countries and trade lanes are covered by the agreement, and then an airline must “turn-on” e-AWB capabilities for the covered lanes. CNS maintains a “matchmaking” tool where carriers can confirm whether a forwarder is part of the multilateral, but this can be a time-consuming and complicated process for cargo agents.
Atlanta-based Delta Air Lines, which boasts one of the highest e-AWB penetration rates in the industry, told the Seattle audience that it was ready to help forwarders activate e-AWB. Rather than confirming e-AWB eligibility on a lane-by-lane basis, Delta has invested in a system that automatically informs cargo agents of a forwarder’s multilateral status, said Rodney Melton, Delta’s program manager for e-commerce. In this way, a forwarder can quickly make the switch for all of its covered lanes. Other airlines still approve e-AWB on a city or lane basis.
Linden’s Sanders and other speakers during the session outlined technology options for smaller organizations that don’t have their own dedicated portals. Lynden uses Descartes for its e-AWB needs, while CHAMP Cargosystems and Riege Software were in Seattle to speak to attendees about their e-AWB requirements.
CHAMP’s Fred Werginz, head of commercial operations for North America, introduced the company’s Logitude application during the session. Logitude, a web-based application, doesn’t require any specialized hardware or software to use and is available from a very basic package offering e-AWB capability only to three larger packages offering more intricate systems.
Charles Kauffman also contributed to this story.
