How to keep cargo in the boardroom

Ashok Rajan is senior vice president at IBS Software and head of logistics and cargo.Since the outbreak of the pandemic, air cargo has been in the forefront of attention. Air cargo was traditionally overlooked by airlines. However, it provided vital supplies for the entire world during the Covid-19 crisis. Passenger transport was forced to stop.It has been an important lifeline for the aviation sector, as cargo yield is at record levels. Airlines with strong freight focus were able quickly and efficiently adapt when the pandemic hit. They added new freighter schedules and more stopovers to existing schedules. This translated into more revenue and a significant advantage in the race to capitalize on the crucial profit-generating opportunity that cargo offers.Passenger airlines were forced by Covid-19 restrictions to shift to a cargo-focused approach over the past year to remain afloat. Many have begun to adopt new technologies in the sector, despite being late to this game. This is a way to beat traditional cargo-focused airlines that are still using older technologies.Air cargo was a huge success in the pandemic and has been proven valuable by the Suez Canal Blockage. However, it is possible that this sector will lose its status as a high-profile market when passenger travel opens up again. However, to reap the full benefits of cargo, airlines need to seriously reevaluate their business models and keep freight in the boardroom for the long-term.It may not be easy to keep cargos at the boardroom table, or invest in sector innovation and practices because of their traditional status. These three factors are key to maintaining momentum:A mindset shift about the value of air cargoAir cargo needs to prove that cargo's true value is more than just reducing risk and maintaining revenue in times of crisis. We must show that cargo is a key profit engine and long-term strategic source for growth and innovation. Only a broad mindset shift will enable cargo to rise to the top of the industry as we enter a new post-pandemic world. The key to establishing a positive distinction for cargo is improving customer experience, transparency, and incorporating purpose-built products that will ultimately help the business.Pricing and profits can be improvedEvidence of value is required to create a shift in mindset towards cargo. An evaluation of the traditional pricing model has been required due to the importance of cargo in the pandemic. Airlines can improve their overall yields and profits by valuing shipments instead of only focusing on passenger capacity. A more dynamic pricing model will enable airlines to offer a more innovative service that can respond to market needs.Prioritizing digital over legacyThe ability to provide evidence that supports a mindset shift is dependent on having the right systems in place to give real insight. Air cargo can be digitalized and automated, and airlines can get actionable insights from their operations and make better business decisions.Pandemics have been a catalyst that airlines needed to see the true value of cargo. The sector must be nurtured long-term to realize its full potential. When passenger travel returns to the priority list, companies that place freight at the top will make healthy profits. The sector will not only be able to recover on passenger income alone, but it will also have the opportunity to grow.