Connecting cargo communities

posted on 12th September 2022
Connecting cargo communities

Airport cargo communities, often built around cargo community systems, have become increasingly important as a way for the otherwise fragmented air logistics chain to align processes and communications, to facilitate effective, efficient and transparent operations. And their evolution from basic data exchange mechanisms to logistics process integrators, as technology and attitudes have developed, has accelerated, reports Megan Ramsay

Airport cargo communities, often built around cargo community systems (CCS), have become increasingly important as a way for the otherwise fragmented air logistics chain to align processes and priorities in order to facilitate effective air cargo operations.
Originating in many cases as mechanisms to exchange import and export messages with the respective customs authority via a ‘single window’, these have evolved and expanded considerably over the years as technology has developed, with this evolution accelerating further in the last few years thanks to Cloud-based technology and APIs.
And several other factors have also been aligning to speed up this process, including higher visibility expectations among customers and other stakeholders, and the Covid pandemic heightening companies’ motivation to use digital processes and collaborate. Certain other developments also promise to take things further still, such as the development of cross-industry options for data exchange among multiple stakeholders; moves to link multiple airport cargo community clouds; and signs that airlines and forwarders are also shedding some of their concerns about sharing air waybill data on a platform.

Individual initiatives
Belgium-based data-sharing platform provider Nallian has seen a growing interest from individual players to move forward with CCS rather than waiting for airport authorities to take the initiative. In such cases, uptake is often much faster than in a true community context, as there are fewer parties that need to align.
However, Nallian CEO Jean Verheyen points out: “There is a growing understanding that a community does not build itself, and the uptake and success of a community system requires change management, and hence attention and resources from the airport. It’s not just about selecting the technology: [airports] should also take an active role to guide, motivate and facilitate the parties at their hub to make such a project a success.”
Changi Airport is among the gateways doing just that. The Changi Air Cargo Community System (ACCS) is an open ecosystem of collaborative and community-based applications underpinned by an information-sharing platform that aggregates data from all parties involved in the cargo handling process. It aims to optimise operational efficiencies and enable end-to-end digitalisation of the air cargo supply chain.
Lim Ching Kiat, Changi Airport Group’s managing director for air hub development, comments: “Among the first few use cases of the Changi ACCS is the Truck Dock Slot Booking (TDSB) application, to even out cargo lodgement and collection at our cargo handlers’ air freight terminals in a safe and secure manner, thereby reducing waiting time, optimising resources and providing greater insights into airport landside activities.”
Elsewhere in Asia, Hong Kong International Airport’s HKIA Cargo Data Platform debuted in October 2021, with its first module covering the export process. The blockchain-enabled network securely connects air cargo supply chain stakeholders to facilitate process digitalisation, and tracks and traces shipments on a near real-time basis.

Efficiency gains
A spokesperson says: “The integration of the application programming interface (API) of the users’ operating system and the Platform has enabled end-to-end process digitalisation in the export pre-declaration process, and freight forwarding agents at Hong Kong International Airport have reported efficiency gains in their relevant operations.”
In January 2022, the second module was rolled out to facilitate the monitoring of sea-air transhipment cargo and support HKIA’s future sea-air transhipment developments.
Moving forward, the spokesperson adds: “With a view to digitalising other aspects of the cargo handling process and creating further synergies, we are working on features that cover import cargo collection and other operations.”

Solution for consolidated shipments
European airports are no less focused on supporting their air freight communities. For instance, Frankfurt Airport operator Fraport has implemented a new FRA-OS/ Import module in its CCS, making Frankfurt one of the first major European cargo hubs to offer a comprehensive, Customs-compliant solution for importing consolidated shipments.
“Six cargo handling companies and more than 15 forwarders covering the entire CargoCity South are now using the new module,” says Max Philipp Conrady, SVP cargo development at Fraport. Time stamps provided by different stakeholders along the supply chain – including airline, ground handling agents, cargo handling agents – allow processes to be planned efficiently, and create a comprehensive and complete overview of the import process.

Advantage in times of bottlenecks
“As a result of the implementation of FRA-OS/ Import, Customs authorises the presentation of goods throughout the entire Customs area of Frankfurt Airport,” Conrady says. “In addition to handling agents, freight forwarders are now able to present goods. This is a significant advantage in times of capacity bottlenecks.”
Fraport has also implemented a web-registration tool called ‘Click2Drive’ that automatically opens the barriers at the entrance to its CargoCity South facility after detecting a registered licence plate, thus speeding up traffic flow and avoiding congestion.
Conrady explains: “We built a data interface between the CCS and Click2Drive. This is a rather small IT solution but with an enormous impact for the truck driver’s comfort, and it gives an idea of the potential of a CCS interacting with other IT systems.”
All major cargo handling warehouses in CargoCity South use the ramp slot management module of the CCS; Frankfurt Cargo Services is the newest – and largest – participant.
Amsterdam Airport Schiphol, too, is working on its CCS (which it terms a Port Community System), Cargonaut. Schiphol took full ownership of the IT platform in 2020.
Luc Scheidel, cargo network director at Schiphol, describes the system as “an important enabler to make the necessary process improvements in the coming years”. The first step will be to make sure that all relevant data is available. The next stage will be to make the process plannable and introduce time slot planning for delivery and pickup of cargo landside.
Scheidel goes on: “The CCS enables us to implement processes that make our cargo processes more seamless and sustainable, while we ensure that they are secure, safe and compliant. For all partners in the supply chain, their process becomes more efficient and predictable.”
For example, by sharing information about outbound shipments (digital pre-notification), the waiting time for trucks at Schiphol has been reduced by approximately 30 minutes.

Transformation trend
According to Amar More, CEO and co-founder of Kale Logistics Solutions, CCS are “setting the digital transformation trend” at airports and ports in North America.
Kale created the first CCS in North America at Atlanta airport. Since then, it has started working with at least six other airport communities in North America and is engaged with another 15 communities.
More feels that CCS offers a true air cargo single window for problems related to congestion, high dwell times, paperwork and supply chain opacity.
“CCS enables supply chain stakeholders to ‘do more with less’, which is so useful in situations where it is difficult to find skilled logistics staff [such as] in North America,” he says.

India template
Indian airports, meanwhile, have “leapfrogged in this development against their counterparts in other regions”, More continues. “Mumbai International Airport has been successfully running on the Airport Cargo Community system (ACS) for a long time now. We now have Bengaluru and Hyderabad joining the trend along with several regional airports.
“The sizes of the communities are huge in India. In Mumbai, we have over 1,900 agents, around 100 airlines, over 500 trucking companies, all the handlers, regulators and two chambers of commerce connected to the platform, facilitating transactions of over 50,000 exporters and importers who can potentially gain visibility of their shipments through their mobile apps. The numbers are similar in Bengaluru, and Hyderabad is also well on course towards 100% adoption.”
In More’s view, Indian airports with such large digital communities provide a template for the digital transformation of cargo elsewhere.

Paradigm shift
The arrival of Cloud-based technology in the last few years has supported the development of a new breed of cargo community systems and platforms offering valuable new functions and capabilities that have the potential to transform airport cargo communities into a seamless air logistics system with visibility to rival that of the integrators.
“In the past, we needed standardisation in messaging to have different systems communicate with each other,” Verheyen says. “Using data-sharing technology, this is no longer needed. It allows collaboration to run a lot more smoothly, via APIs, which allows moving forward without the need for the whole world as one to do so. As such, data-sharing technology opens doors that have so far often remained closed (since there’s a tendency in our industry to ‘wait for the others’ to go first, and as result we don’t go forward at all).”

Global scaffolding
But a framework of standards is still essential to the successful implementation of CCS on a global scale. IATA’s ONE Record initiative aims to provide that scaffolding.
ONE Record started out as a general-purpose standard for transparent data exchange throughout an end-to-end digital supply chain. Over the last few years, it has expanded to cover a number of applications including CCS. There are about 100 companies piloting ONE Record at present and some are using it operationally, including as part of a CCS structure.
“Everyone has developed their own
CCS. The key is that they can connect with each other, which is why we need standards,” says Henk Mulder, head of digital cargo at IATA. “Fortunately, IATA is building on a legacy of very good agreements in terms of how we govern data exchange; the governance, legal framework, infrastructure and experience are all in place.
“CCS have been around for several decades,” continues Mulder. “They all follow a similar pattern, trying to support the entire community with digital services, data quality and so on.
“Perhaps five to 10 years ago, technology such as the Cloud changed the paradigm a bit. Previously, you had to use a CCS to connect, but with the Cloud you can connect direct with your partners. Cloud technology affords opportunities for CCS to go further than their traditional role of exchanging data and managing data quality.
“New CCS can distribute rates or track shipments using IoT, for instance. CCS providers will extend their portfolios using Cloud technology and, more importantly, airlines and their partners will acquire capabilities they didn’t have before.”
Working together
The faster CCS and IT solutions providers progress, the more the industry will benefit, Mulder believes, and IATA is working with the majority of the existing providers.
“They are with us so we know what they’re doing and we don’t miss the boat, while they are aware of what we’re working towards and have a chance to influence what we’re doing,” Mulder says.
He believes the biggest difference in five or 10 years’ time will be the extent to which data is shared beyond basic exchanges like shipment status.
Kale, for instance, is working on expanding the reach and depth of its community platform by providing value-added features like applications for Customs broking and freight forwarding, as well as creating the world’s largest digital logistics Cloud for the international supply chain – through a global network of airports and ports connected digitally via its digital corridors (of which, more later).
Lim points out that the Covid-19 pandemic has “demonstrated the fragility of the air cargo industry and underscored the importance of digitisation and data-sharing across the air cargo value chain. There will be stronger pressure on air cargo communities to accelerate the industry’s digitisation efforts and to share data in order to enhance supply chain visibility and efficiency, thereby building resilience across a fragmented industry.”

Overcoming trust issues
These developments are “turning issues of trust upside down”, Mulder says. Companies are realising that if they share data, the overall data pool becomes richer and more extensive. “It actually becomes more valuable in dollar terms,” he remarks.
While building cargo communities and aligning them to a common vision is no easy feat, Lim observes that the air cargo industry is beginning to see the benefits of community collaboration not just within airport communities, but between them, too.
In the long run, Conrady believes, “we need to make sure that the CCS of different providers and different places are able to communicate with each other – reaching full transparency and a maximum of automation with fully digital shipment data (eAWB) and smart, digital processes providing a sustainable and successful air freight product”.
This is because, as Scheidel puts it, “The future of digitalisation and data in air cargo is in better connected but distributed data platforms. This is the main concept of ONE Record, the EU programme FEDeRATED and the Digital Transport Strategy of the Dutch government. A global CCS would not be one single system, but connected CCS based on common agreements.”

Digital trade corridors
Such is the creation of digital trade corridors – like the blockchain-powered Digital Air Freight Corridor that Kale has established between India and the Netherlands – aimed at creating a completely transparent supply chain through exchange of real-time status of shipments between two airports, and exchange of shipment data to eliminate duplicate processes. For example, shipment arrival information can be shared in advance to the relevant stakeholders at a destination airport so that Customs, handlers and other parties are prepared to handle incoming freight on time.
Kale also offers an online portal for booking door-to-door cargo transport services, with competitive pricing and transparency of shipment options across all modes of transport.

Multimodal connections
“We believe that the future is multimodal, so we are working on creating sea-air corridors as well for facilitating intermodal cargo movement. Our large communities are going to be integrated into our logistics e-marketplaces that are under development,” he states.
The ‘e-marketplace’ platform connects supply chain stakeholders such as freight forwarders, Customs brokers, shipping lines, airlines, transporters, consignees, warehouse operators, rail operators and regulatory authorities, enabling them to adopt modern logistics practices that will allow better response to customer demand, increased efficiency and a more competitive industry. The platform can connect with third-party systems, CCS and the systems of airport authorities and terminal operators to provide status updates, More says.
“We are also working on implementing the deep tech use cases of IoT, blockchain, AI and machine learning in our community platforms,” he adds.
Fraport, too, is working with airports and other companies from the air cargo logistics sector on a research project entitled ‘Digital Test Field Air Cargo’. The project is co-funded by the federal Ministry for Digital and Transport and offers an opportunity for exchange beyond the borders of the airport. One goal is to standardise the exchange of data between all players in the air cargo transport chain and to digitalise processes.
“We are focusing together on the evolving ONE Record standard by IATA,” Conrady explains. “An improved data situation helps to identify problems and bottlenecks earlier or to use resources such as means of transport, space and equipment more efficiently.”
‘Single Window’ mandate
With the World Trade Organization’s trade facilitation agreement now ratified by over 150 countries, digital tools like CCS will be necessary at those nations’ airports and ports, More notes. He also highlights the International Maritime Organization’s mandate for a Maritime Single Window for all ports from 2024, and hopes a similar mandate will come into force in air cargo soon.
Mulder is confident of this, and believes ONE Record standards will serve as a framework for the mandate as and when it comes into force. Indeed, ONE Record is already present on a global scale: most implementations are in Europe, but there are also many in China and in the Americas.
Fundamentally, a CCS involves more than the development of smart IT solutions. It requires a collaborative and trusting environment among the community – including partners and competitors.

Community interdependence
“A CCS is all about integrating processes and connecting process partners, thus bringing tremendous benefits but also revealing each other’s challenges or even under-performances,” Conrady says. “Hence, successful cargo operations do not only need a CCS that works well, but also an open-minded and appreciative community where all members are aware of their interdependence.”
And it is vital that the industry adopts that mindset, in More’s view: “We just can’t continue to work the way we have been so far, where cargo stays on the ground for up to 85% of the total transportation time. The technology is available for airports and ports; all that’s needed is the right leadership with intent. We believe the time to act is now.”