Airfreight rate rises – is the process out of date?

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In an age where flexible pricing is becoming the norm (Uber, petrol stations, passenger air fares), why does the cargo industry still stick to published rates – and rate increases? That’s the question posed by Mark Grinsted on CargoForwarder. And it’s a good question. As the annual autumn rate hike starts, he notes that in reality, spot rates are “the essence of the business”, and that works well for capacity – which is perishable and very much at the mercy of supply and demand. He also switches it around: how would you feel about a supermarket that suddenly put all its prices up 5-10%, saying they want better margins? You’d probably shop elsewhere. While he acknowledges the system may help forwarders put up their rates, he reckons it’s mostly done for tradition – not a worthwhile cause modern day. He urges the industry to come up with some new ideas next year, and cut out some of the time-wasting involved in creating the published rates. A provocative read.