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Benefits of Air Cargo Why is there a relationship between a product\u2019s value and its propensity to be shipped by air transportation? Small shipment size<\/strong><\/p>\n Due to their cost, these commodities tend to move in relatively small lot sizes, which make them suitable Time sensitivity<\/strong><\/p>\n Certain products are extremely time sensitive. These could include a wide range of perishables, medical Security<\/strong><\/p>\n High value commodities, by definition, require more security from loss, damage or theft than lower-value Cost of Capital<\/strong><\/p>\n High-value commodities consume large amounts of capital and impose high interest costs on their owners. Inventory cost<\/strong><\/p>\n Because air cargo operations can offer a shipper the benefit of speedy, constant resupply, inventory levels <\/p>
\n<\/strong><\/p>\n
\nThere is no single answer, but it is safe to say that relatively high-value commodities tend to go by air,
\ndespite the much higher cost, for one or several of the following reasons:<\/p>\n
\nfor air transport. To use an extreme example, no one buys gold in quantities sufficient to fill a twenty-foot
\nsea container. While less costly than gold, electronics, precision instruments, sophisticated industrial
\nmachinery and other high-value commodities also tend to be smaller in size and weight.<\/p>\n
\nproducts, and seasonal products that must meet very specific delivery deadlines and whose production
\noffers limited options other than by air.<\/p>\n
\ngoods. Aircraft generally offer not only the fastest but also the most secure way to move cargo from point
\nto point.<\/p>\n
\nThus, the time-savings achieved through air cargo are worth more when high-value commodities are
\ninvolved. Collectively, these value-driven factors are at work, although their impact on transport decisions
\ndepends on changing shipper perceptions of their relative importance. Moreover, other factors unrelated to
\ncommodity value increasingly influence shippers\u2019 modal selection process. To better understand each
\nfactor, and how it interacts with the others, it is necessary to first explore how transportation modes are
\nselected and recognize, in general, that shippers do not care about transportation mode. They care about
\nthe consignment reaching its intended destination, on time and in good condition, and the cost of the
\ntransportation.<\/p>\n
\ncan be reduced. This element of speed allows a producer to ship select products to their customers just in
\ntime instead of having to operate large warehousing facilities. By reducing inventory levels, a firm can free
\nup more capital, reduce inventory holding costs, and reduce obsolescence cost.
\nIn summary, air cargo provides the benefits of speed, reliability, security, and reduction of inventory cost. <\/div>\n <\/div>\n \n[\/vc_column][vc_column width=”1\/2″][vc_custom_heading text=”GET IN TOUCH”]<\/ul><\/div>\n