Five ways real-time freight intelligence drives ROI in tender negotiations – and beyond
Market volatility has transformed how shippers procure ocean and air freight, driving a shift toward ...
DHL: ANTITRUST SCRUTINYFWRD: UPDATETSLA: TRUMP BOOSTWMT: UNSTOPPABLEAMZN: NEW HIGH AAPL: UP SHE GOESVW: LABOUR DEAL SOUGHTAAPL: NEW RECORD DHL: BOTTOM FISHINGF: DOWNSIDE RISKAMZN: ANOTHER HIGH WMT: ON A ROLLHON: INVENTORY UNLOCKBA: MORE OF THE SAMEGXO: HAMMEREDMAERSK: BOUNCING BACK
DHL: ANTITRUST SCRUTINYFWRD: UPDATETSLA: TRUMP BOOSTWMT: UNSTOPPABLEAMZN: NEW HIGH AAPL: UP SHE GOESVW: LABOUR DEAL SOUGHTAAPL: NEW RECORD DHL: BOTTOM FISHINGF: DOWNSIDE RISKAMZN: ANOTHER HIGH WMT: ON A ROLLHON: INVENTORY UNLOCKBA: MORE OF THE SAMEGXO: HAMMEREDMAERSK: BOUNCING BACK
The true value of ‘dynamic’ air cargo loadfactors has been underlined with the decision by freight rate benchmarking platform Xeneta to integrate Clive Data Services’ loadfactor data.
Clive offers first-to-market weekly and monthly data, with a unique dynamic loadfactor that measures loads both on volume and weight, rather than the traditional, misleading weight-only calculation; flights normally ‘cube out’ before ‘weighing out’.
Xeneta’s platform aggregates shipper data from major companies to create insight into more than 40,000 airport-to-airport combinations, with almost 3m contracted rates.
The platform allows users to assess long and short-term rates, as well as a combination of both, to identify and understand the latest trends and tailor procurement strategy.
“The air freight market can prove exceptionally challenging when you’re trying to benchmark rates, assess availability and get the best value for your cargoes and businesses – and, since the advent of Covid-19, a new layer of complexity has spread over the entire industry,” said Xeneta CRO Paul Mullins.
“In such a dynamic environment, our customers find contracted rates simply aren’t actionable and spot rates ‘play by a new set of rules’, with fluctuations that are both difficult to predict and stay abreast of.
“The result is a lack of visibility when businesses need it most. But by combining our up-to-the-minute rates data with Clive’s unique loadfactor and capacity analyses, we can give customers the accurate market intelligence they need to enter negotiations with confidence. We believe this creates a truly unique proposition right now.”
Clive developed its unique data in 2017, after a campaign in The Loadstar to urge airlines to participate. The first datasets showed that the average volume loadfactor, of 66%, was 10 percentage points higher than the weight loadfactor of 56%. Applying the dynamic loadfactor metric put utilisation at 71%.
Clive MD Niall van we Wouw explained at the time: “The results confirm that the weight loadfactor is not an accurate metric to measure the capacity utilisation in our industry. It poorly reflects how full the planes really are. That in itself would not be an issue if it was regarded as such, but that is not the case. The weight loadfactor is still often regarded as the standard for reporting on capacity utilisation – overlooking the fact that the dynamic loadfactor, as our analysis shows, is far more reflective of the true utilisation of air cargo capacity.”
The benefit of accurate loadfactors has been seized upon by the industry, with Clive’s data now used by several organisations, including the TAC Index and Tiaca. IATA, however, which continues to publish the out-dated and unhelpful weight loadfactors, said in 2018 that it would form a thinktank to review the data – but nothing has happened since.
Clive’s other USP is the speed to market of the data, which is provided on a weekly basis.
Mr van de Wouw said: “Today’s air cargo market is more dynamic that at any time previously and that’s why businesses need the fastest and most accurate data. Companies must be able to make informed decisions, based on the latest trends and fluctuations in the market, which we see on a weekly basis. Xeneta clearly sees this too for customers who need a single, integrated tool to make smarter air freight decisions.”
Comment on this article