Regional Development and Air Freight Service Needs for Regional Communities

Regional Development and Air Freight Service Needs for Regional Communities

Tarryn Kille (Griffith University, Australia), Paul Bates (University of Southern Queensland, Australia) and Patrick S. Murray (University of Southern Queensland, Australia)
Copyright: © 2018 |Pages: 10
DOI: 10.4018/978-1-5225-2255-3.ch684
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Abstract

This article is intended to assist in documenting the needs of regional communities with regards to air freight services. In doing so, the article first considers the importance of air service access to small and regional communities with particular emphasis on those economies bolstered by agriculture and the production of high-value, low weight, perishable products. The article then explores the air freight challenges facing regional communities and discusses the needs for: integration; infrastructure; and service reliability. The article provides an overview of potential solutions to assist in meeting these needs, including: improving the flow of information and communication between businesses in the entire distribution system; and applying electronic commerce tools to assist in integrating systems and sharing information.
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Background

Over the past two decades, the air cargo industry has grown dramatically (Yuan, Low, & Ching Tang, 2010). Although world air cargo traffic stagnated from mid-2011 to 2013 (Boeing, 2014), growth returned in 2014 accounting for approximately 35% of global merchandise trade by value (International Air Transport Association, 2015). The dramatic growth in the global airfreight sector may be explained by three observations.

Firstly, the dramatic growth in airfreight can be explained by an apparent industry trend towards the production of high value, lightweight goods (Ari-Pekka & Hintsa, 2009). This includes the new economy associated with the transport of fresh, perishable, high value produce (Sim, Barry, Clift, & Cowell, 2007). Statistics support this emerging economy highlighting that the transport of perishable food accounts for 14% by volume of total global airfreight (Bridger, 2008). Secondly, producers and shippers are realizing that the higher costs associated with airfreight can potentially be offset by the costs savings associated with storage, and packaging when using other freight modes (Yuen et. al,. 2010). Finally, on a global scale, air service costs have experienced a reduction due to the entry of large numbers of wide body freighters to the logistics industry (Gardiner, Ison, & Humphreys, 2005). As such, the overall effect is that airfreight is becoming a commonplace business decision in the distribution systems of many companies (Murphy, Dalenberg, & Daley, 1989).

Increases in the perishable airfreight task are linked to the emergence of a social focus on the consumption of foods produced from regions known for ‘clean’ production processes. This new social focus has called for research, which investigates the food chain in an effort to understand rural development patterns (Renting, Marsden, & Banks, 2003). Thus, sea, road, rail and air transport of freight in the food production cycle from the farm to the consumer’s table has come under scrutiny (Saunders & Hayes, 2007). The scrutiny has been applied in the pursuit of clarity surrounding the cost of transport to the environment, society and communities.

Regional communities are the first step of the food production cycle. For many regional communities, access to airfreight networks means an opportunity to penetrate and participate in markets that cannot be equally serviced by other modes of transport. For perishable agri-producers, access to market requires access to appropriate freight services with the ability to transport products efficiently and effectively from the farm to the consumer plate. Thus, understanding the needs of regional communities with regards to airfreight access is an important factor in fostering sustainable economies for these communities (Kille, Bates, & Murray, 2013).

Key Terms in this Chapter

Logistics Information Systems: A subset of an organization’s entire information system, and is focused on the particular issues associated with logistics decision-making.

Electronic Data Interchange: The electronic interchange of business information within a standardized format. This process then allows one business to send information to another business electronically and without paper.

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