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Chapter�–�4�
LOGISTICS�SERVICES�RENDERED�BY�FREIGHT�FORWARDERS�IN�
INTERNATIONAL�AIRPORTS�IN�KERALA���AN�ASSESMENT�
The previous chapter analyzed the performance and future demand of
international air cargo traffic in Kerala and indicated an upward trend. But efficient
and effective flow of air cargo traffic depends upon the availability of high quality
logistics facilities in the airport. The principal logistics facilities which facilitate air
cargo traffic in the airport are freight forwarding, customs clearance and
warehousing. Air freight forwarding services are rendered by air freight forwarders
or clearing and forwarding agents (C&F) and they play a very significant role in the
smooth flow of international air cargo operations. Air freight forwarders, whether
individuals or organizations, provide service to shippers and importers which
originally involved receiving a consignment of freight from shipper, arranging its
routing, transportation handling ,and documentation to either final receiver or to a
foreign airport. It is the responsibility of air freight forwarders to ensure that
internationally traded goods move from point of origin to point of destination in good
order and condition and at the lowest cost.
Air freight forwarders are individuals or organizations offering air services
transport of merchants’ goods. They are IAIA cargo agents registered by IATA to act
on behalf of appointing airlines and are the key customers of the airlines. Appointing
airlines give them stock of Air Way Bill and commission. Air freight forwarders are
divided into domestic and international segments. They ensure the quality of services
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 146
so that customer satisfaction is ensured. They are entrusted with the task of
maintaining and improving air freight services in addition to the responsibility of
ensuring that trader’s products are transported quake and safe.
In this chapter an attempt is made to analyze the services rendered by
freight forwarders in air cargo traffic in Kerala and the problems they face while
rendering the services. For this purpose, a survey was conducted among the freight
forwarders or C&F agents in the international airports in Kerala. The information
was collected from the freight forwarders with the help of a structured questionnaire
and detailed discussion. The respondents consisted of 115 freight forwarders: 45
from CIAL, 40 from TACT and 30 from CACC. All the freight forwarders were
IATA agents.
The analysis has two parts. The first deals with profile of the freight
forwarding firms; and the other deals with the assessment of services rendered by
freight forwarders in air cargo traffic in Kerala and the problems they face while
rendering the services.
Part-I
4.1 Profile of the Sample Organization
Profile of the sample firms is analysed by using the variable such as the
nature of the firm, number of years of functioning, number of employees in the firm,
and qualification of managers. These variables are analyzed in the following Tables:
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 147
4.1.1 Nature of the Organization
Freight forwarding firms operating in the airports in Kerala consists of
National level private companies and Multinational companies (MNC). The response
of freight forwarders regarding nature of the organization are given in Table 4.1.
Table 4.1
Nature of the Organization
Nature of the firms
Airports Total
CIAL TACT CACC
No % No % No % No %
National level private Company 29 64.44 23 57.50 17 56.67 69 60.0
0
Multinational Company 16 35.56 17 42.50 13 43.33 46 40.00
Total 45 100 40 100 30 100 115 100
Source: Survey data
Table 4.1 reveals that majority (60 per cent) of the air freight forwarding
firms in Kerala under study are National level private companies and the role of
multinational companies is only 40 per cent. Airport-wise analysis also shows more
or less the same result. It shows that 64.44 per cent firms in CIAL, 57.50 per cent
firms in TACT and 56.67 per cent firms in CACC are national level private
companies but 35.56 per cent firms in CIAL, 42.50 per cent firms in TACT and
43.33 per cent firms in CACC are multinational companies.
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Logistics Management in International Airports in Kerala 148
4.1.2 Number years of Functioning
The freight forwarding firms operating in the airports in Kerala consists of
less experienced and well experienced firms. The response of freight forwarders
regarding the number of years of functioning is given in Table 4.2.
Table 4.2
Number of Years of Functioning
Number of years of functioning
Airports Total
CIAL TACT CACC
No % No % No % No %
Less than 5 4 8.88 6 15.00 8 26.67 18 15.65
5-10 25 55.56 21 52.50 18 60.00 64 55.65
10 and above 16 35.56 13 32.50 4 13.33 33 28.70
Total 45 100 40 100 30 100 115 100
Source: Survey data
It is observed that 55.65 per cent of the air freight forwarding firms under
study have 5-10 years of experience in this field, 28.70 per cent have more than ten
years of experience and the remaining 15.65 per cent have less than five years of
experience (Table 4.2). Airport-wise analysis shows that 8.88 per cent firms in
CIAL, 15 per cent firms in TACT and 26.67 per cent firms in CACC have less than
five years of experience, 55.56 per cent firms in CIAL, 52.50 per cent firms in TACT
and 60.00 per cent firms in CACC have 5-10 years of experience. 35.56 per cent
firms in CIAL, 32.50 per cent firms in TACT and 13.33 per cent firms in CACC
have more than ten years of experience.
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Logistics Management in International Airports in Kerala 149
4.1.3 Number of employees in the office
The function of freight forwarding firms is to provide service to their
customers, not to produce anything. So less number of employees is needed to
conduct this type of business. The responses of freight forwarders regarding number
of employees in the office are given in Table 4.3.
Table 4-3
Number of employees in the Office
Number of Employees
Airports Total
CIAL TACT CACC
No % No % No % No %
Less than 5 5 11.11 4 10.00 5 16.67 14 12.1
8
5-10 32 71.11 30 75.00 22 73.33 84 73.0
4
10 and above 8 17.78 6 15.00 3 10.00 17 14.7
8
Total 45 100 40 100 30 100 115 100
Source: Survey data
Out of 115 freight forwarding firms, majority (73.04 per cent) of the firms
have 5-10 number of employees, 12.18 per cent have less than 5 and 14.78 per cent
firms have more than 10 (Table 4.3). Airport-wise analysis does not show wide
variation in this regard. It shows that 11.11 per cent firms in CIAL, 10 per cent firms
in TACT and 16.67 per cent firms in CACC have less than five number of
employees, 71.11 per cent firms in CIAL, 75.00 per cent firms in TACT and 73.33
per cent firms in CACC have between 5-10 number of employees and 17.78 per cent
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 150
firms in CIAL, 15 per cent firms in TACT and 10 per cent firms in CACC have ten
and more number of employees.
4.1.4 Qualification of Managers
For conducting freight forwarding business no special qualification is
required. A certificate from Customs authority is required to perform customs
clearance function for the air cargo traffic. But air cargo logistics operations require
skilled manpower and proficiency with knowledge of customs procedure and IT
systems. Warehouse management, logistics and freight forwarding are separate
subjects and require specialized training. Hence, for successful conduct of business,
special qualification in the area of logistics management is necessary for the
successful conduct of the business. The response of freight forwarders in the airports
in Kerala regarding qualification of managers are given in Table 4.4.
Table 4.4
Qualification of Managers
Qualification
Airport Total
CIAL TACT CACC
No % No % No % No %
Specially qualified 11 24.44 8 20.00 6 20.00 25 21.74
Not specially qualified 34 75.56 32 80.00 24 80.00 90 78.26
Total 45 100 40 100 30 100 115 100
Source: Survey data
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 151
It is evident from the Table 4.4 that managers of 78.26 per cent freight
forwarding firms under study are not specially qualified and only 21.74 per cent
firms managers are specially qualified. Airport-wise analysis also shows more or less
the same results. It shows that managers of 75.56 per cent firms in CIAL, 80 per cent
firms in TACT and 80 per cent firms in CACC are not specially qualified and
managers of 24.44 per cent freight forwarding firms in CIAL, 20 per cent firms in
TACT and CACCs are specially qualified. The analysis reveals that managers of
majority of the firms operating in international airports Kerala have no special
qualification from the area of logistics management. Most of them are learn things
on the job itself. So firms needed to recruit specially qualified managers in the
field of logistics management for efficient functioning of the firms.
Part-II
4.2. Extent of Logistics Functions Performed by Freight Forwarders
in Air Cargo Traffic in Kerala
In this section, the services rendered by the freight forwarders in air cargo
traffic in Kerala are assessed. Variables identified under this head are freight
forwarders area of operations, destination of cargo handled, mode of transport used,
involvement in international trade activities, items of goods handled, regularity in
dealing, logistics facilities offered by the freight forwarders, type of carrier used, an
agents of all airlines, problems faced by freight forwarders from airlines, facilities
needed from the airlines’ common constraints in the airport and prospects of demand
of freight forwarding firms in Kerala. All these are assessed in the following tables:
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 152
4.2.1 Area of Operation
The area of operation of freight forwarders is either limited to one or two
airports or all airports in Kerala. The opinion of the freight forwarding firms
regarding area of operation is shown in Table 4.5.
Table 4.5
Area of Operation
Area of Operation
Airport Total
CIAL TACT CACC
No % No % No. % No %
All airports in Kerala 17 37.78 11 27.50 9 30.00 37 32.17
One or two airports in Kerala 28 62.22 29 72.50 21 70.00 78 67.83
Total 45 100 40 100 30 100 115 100 Source: Survey data
It is observed that majority (67.83 per cent) of the freight forwarding firms
have limited their operations to one or two airports whereas 32.17 per cent firms
have operations in all airports in Kerala (Table 4.5). The airport-wise analysis also
shows more or less the same results. It shows that 37.78 per cent firms in CIAL,
27.50 per cent firms in TACT and 30 per cent firms in CACC have operation in all
the airports in Kerala. But 62.22 per cent of firms in CIAL, 72.50 per cent firms in
TACT and 70 per cent firms in CACC limited their area of operations to one or two
airports only.
4.2.2 Destination of Cargo Handled
Cargo has international and domestic destinations. The opinion of the freight
forwarders regarding the destination of the cargo handled is shown in Table 4.6.
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Logistics Management in International Airports in Kerala 153
Table 4.6
Destination of Cargo Handled
Destination
Airports Total
CIAL TACC CACC No. %
No % No % No %
Domestic only - - - - - - - -
International only 31 68.89 31 77.50 22 73.33 84 73.04
Both 14 31.11 9 22.50 8 26.67 31 26.96
Total 45 100 40 100 30 100 115 100
Source: Survey data
Table 4.6 reveals that majority (73.04 per cent) of the freight forwarding
firms under study handle international trade only. None of the firms handle domestic
trade alone and 26.96 per cent handle both international and domestic trade. The
airport-wise analysis also shows more or less the same results. It shows that 68.89
per cent of freight forwarders in CIAL, 77.50 per cent freight forwarders in TACT
and 73.33 per cent freight forwarders in CACC handle international cargo traffic
only and 31.11 per cent freight forwarders in CIAL, 22.50 per cent freight forwarders
in TACT and 26.67 per cent freight forwarders in CACC handle both domestic and
international cargo traffic. None of them act exclusively for domestic trade.
4.2.3 Mode of Transport for International Destination
Mainly two modes of transport—air and sea—is used for international trade.
Opinion of the freight forwarders regarding the mode of transport for international
air cargo traffic shown in the Table 4.7.
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Logistics Management in International Airports in Kerala 154
Table 4.7
Mode of transport for International Destination
Mode
Airport Total
CIAL TACC CACC
No % No % No % No %
Air only 9 20.00 18 45.00 19 63.33 46 40.00
Both Air and Sea 36 80.00 22 55.00 11 36.67 69 60.00
Total 45 100 40 100 30 100 115 100
Source: Survey data
It is clear from the Table 4.7 that 60 per cent respondents handle both sea and
air cargo traffic, and 40 per cent handle air transport only. But the airport-wise
analysis shows some differences in this regard. It shows that 20 per cent respondents
in CIAL, 45 per cent respondent in TACT and 63.33 per cent respondent in CACC
handle air cargo only and 80 per cent respondent in CIAL, 55 per cent in TACT and
36.67 per cent respondent in CACC handle both air and sea cargo. It may be due to
the fact that in CIAL and TACT, there is better connectivity to sea port and as a
result a greater number of freight forwarders handle both air and sea cargo.
4.2.4 Activities in International Trade
International trade activities consist of both exports and imports. Some firms
deal with exports activities only, some deal with imports activities only and another
group deals with both imports and exports activities. Opinion of the freight
forwarders in this regard is shown in the Table 4.8.
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Logistics Management in International Airports in Kerala 155
Table 4.8
Freight Forwarders’ Involvement in International Trade Activities
Activities
Airports
CIAL TACT CACC Total
No % No % No % No %
Exports only 12 26.67 16 40.00 13 43.33 41 35.65
Imports only 8 17.78 13 32.50 8 26.67 29 25.22
Both 25 55.55 11 27.50 9 30.00 45 39.13
Total 45 100 40 100 30 100 115 100
Source: Survey data
It is observed that 35.65 per cent freight forwarders under study deal with
export activity only, 25.22 per cent with import activity only and 39.13 per cent
handle both export and import activities. (Table 4.8). But the airport-wise analysis
shows some difference in this regard. In CIAL, the majority (55.55 per cent) of
freight forwarders deal with both export and import activities but in TACT only
27.50 per cent deal with both activities and it is 30 per cent in CACC. 26.67 per cent
freight forwarders in CIAL, 40 per cent freight forwarders in TACT and 43.33 per
cent freight forwarders in CACC deals with export activity only.17.78 per cent
freight forwarders in CIAL, 32.50 per cent freight forwarders in TACT and 26.67 per
cent freight forwarders in CACC deals with import activity only.
4.2.5 Items of goods handled in the International Sector for Exports
Exports cargo handled in the international airports in Kerala mainly consists
of perishable cargo, general cargo, valuable cargo and other items which include
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 156
dangerous goods and courier items. Responses of the freight forwarders regarding
item handled for exports are given in Table 4.9
Table 4.9
Items of goods handled in the International Sector for Exports
Items Opinion
Airports
CIAL TACT CACC Total
No % No % No % No %
Perishable
Always 24 64.86 27 100 22 100 73 84.88
Sometimes 4 10.81 - - - - 4 4.65
Never 9 24.32 - - - - 9 10.47
Total 37 100 27 100 22 100 86 100
General
Always 20 54.05 4 14.82 - - 24 27.91
Sometimes 12 32.43 5 18.51 7 31.82 24 27.91
Never 5 13.52 18 66.67 15 68.18 38 44.18
Total 37 100 27 100 22 100 86 100
Valuable
Always 4 10.81 - - - - 4 5.88
Sometimes 7 18.92 6 22.22 4 18.18 17 19.76
Never 26 70.27 21 77.78 18 81.82 65 75.58
Total 37 100 27 100 22 100 86 100
Others
Always - - - - - -
Sometimes 13 35.14 6 22.22 3 13.64 22 25.58
Never 24 64.86 21 77.78 19 86.36 64 74.42
Total 37 100 27 100 22 100 86 100
Source: Survey data
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 157
As far as perishable cargo is concerned, 84.88 per cent freight forwarders
always deal with it; 4.65 per cent sometimes deal with it and the remaining 10.47per
cent never deal with it (Table 4.9). But the airport-wise analysis shows that all the
freight forwarders in TACT and CACCs under study always deal with perishable
cargo but in CIAL it is only 64.87 per cent. This happens because in TACT and
CACCs almost 98 per cent (Table 3.22 and Table 3.23) of the quantity of exports
cargo consists of perishable items but in CIAL it is around 60 per cent (Table 3.21).
In the case of general cargo, majority (44.18 per cent) of freight forwarders
under study never deal with it; only 27.91 per cent sometimes deal with it and the
same percentage always handle it (Table.4.9). The airport-wise analysis shows that
around 67 per cent of the freight forwarders in TACT and CACCs never deal with
general cargo, whereas in CIAL such persons account for 13.52 per cent and 54.05
per cent constantly deal with it. The reason behind this difference is that in CIAL,
around 40 per cent (Table 3.21) of quantity of exports cargo consists of general cargo
but in other airports only negligible quantity of exports cargo (around 2 per cent )
consists of general cargo (Table 3.22 and Table 3.23).
Majority (75.58 per cent) of the freight forwarders under study never deal
with valuable cargo, 19.76 per cent sometimes deal with it and only 5.88 per cent
always deal with it. (Table.4.9). Airport-wise analysis shows that in TACT and
CACCs none of them always deals with valuables cargo but in CIAL it is 10.81 per
cent. Only 18.92 per cent of freight forwarders in CIAL, 22.22 per cent in TACT and
18.18 per cent of freight forwarders in CACC sometimes deal with valuable cargo.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 158
Majority of the freight forwarders (70.27 per cent) in CIAL, 77.78per cent in TACT
and 81.81 per cent in CACC never deal with valuable cargo.
Regarding other cargo exported through international airports in Kerala, none
of the freight forwarders always deal with it; only 25.58 per cent sometimes deal it;
and 74.42 per cent never deal with it. Airport-wise analysis shows that none of the
freight forwarders in all the three airports always deal with other cargo. 35.14 per
cent freight forwarders in CIAL, 22.22 per cent in TACT and 13.64 per cent firms in
CACC sometimes deal with other cargo. 64.86 per cent freight forwarders in CIAL,
77.78 per cent freight forwarders in TACT and 86.36 per cent freight forwarders in
CACC never deals with other cargo.
4.2.6 Items of goods handled in the International Sector for Imports
Imports cargo handled in the airports mainly consists of Unaccompanied
Baggage (UB), general cargo including valuable cargo, courier cargo and dangerous
goods. Responses of the freight forwarders regarding item handled for imports are
given in Table 4.10
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 159
Table4.10
Items of goods handled in the International sector for Imports
Items Opinion
Airports
CIAL TACC CACC Total
No % No % No % No %
UB
Always 5 15.15 14 58.33 13 76.47 32 43.24
Sometimes 8 24.24 6 25.00 4 23.53 18 24.32
Never 20 60.61 4 16.67 - - 24 32.44
Total 33 100 24 100 17 100 74 100
General
Always 26 78.79 5 20.83 - - 31 41.89
Sometimes 4 12.12 4 16.67 7 41.18 15 20.27
Never 3 9.07 15 62.50 10 58.82 28 37.84
Total 33 100 24 100 17 100 74 100
Source: Survey data
The Table 4.10 reveals that majority (43.24 per cent) of the air freight
forwarder always deal with UB; 24.32 per cent sometimes deal with it; and the
remaining 32.44 per cent never deal with UB. But the airport-wise analysis shows
wide variation in this regard. It shows that in CIAL majority (60.61 per cent) never
deal with UB; but in Trivandrum and CACCs majority of firms always deal with UB.
The reason may be that in TACT and CACCs majority of the imports cargo handled
consists of UB (Table 3.30 and Table 3.31).
As far as general cargo is concerned majority (41.89 per cent) of the
respondents always deals with it. But the airport-wise analysis shows some
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 160
difference in this regard. It shows that in CIAL almost 79 per cent respondents
always deal with general cargo but in TACT and CACC that majority of respondent
never deals with general cargo(Table 4.10).
4.2.7 Regularity in Dealing with Air Cargo Business
Some freight forwarders in international airports in Kerala regularly deal with
the air cargo traffic while others do not do so. Responses of the freight forwarders
regarding regularity in dealing are given in Table 4.11
Table 4.11
Regularity in Dealing with Air Cargo Business
Opinion
Airports
CIAL TACT CACC Total
No % No % No % No %
Regular dealer 38 84.44 35 87.50 22 73.33 95 82.61
Not a regular dealer 7 15.56 5 12.50 8 26.67 20 17.39
Total 45 100 40 100 30 100 115 100
Source: Survey data
It can be seen from the table that majority (82.61 per cent) of the respondents
are regularly engaged in air cargo business and only 17.39 per cent are not regular
dealers (The table 4.11). The airport-wise analysis also shows more or less the same
results. It shows that 84.44 per cent freight forwarders in CIAL, 87.50 per cent in
TACT and 73.33 per cent freight forwarders in CACC regularly deal with air cargo
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 161
business. Remaining 15.56 per cent freight forwarders in CIAL, 12.50 per cent in
TACT and 26.67 per cent in CACC do not regularly deal with air cargo business.
4.2.8 Regular shipper or consignee
Freight forwarders who are regularly dealing with air cargo business
sometimes have regular shipper or consignee. Responses of the freight forwarders
regarding regular shipper or consignee are given in Table 4.12.
Table 4.12
Freight forwarders having Regular Shipper or Consignee.
Opinion
Airports
CIAL TACT CACC Total
No % No % No % No %
Yes 35 92.11 25 71.43 19 86.36 79 83.16
No 3 7.89 10 28.57 3 13.64 16 16.84
Total 38 100 35 100 22 100 95 100
Source: Survey data
It is observed from the table 4.12 that 83.16 per cent freight forwarders
regularly dealing in air cargo business have regular shipper or consignee (Table
4.12). The airport-wise analysis also shows more or less the same results. It shows
that 92.11 per cent freight forwarders in CIAL, 71.43 per cent in TACT and 86.36
per cent freight forwarders in CACC have regular shipper or consignee and the
remaining 7.89 per cent in CIAL, 28.57 per cent in TACT and 13.64 per cent in
CACC have no regular shipper or consignee.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 162
4.2.9 Logistics Functions Offered by Freight Forwarders to Shipper
Logistics functions offered by the freight forwarders to the shipper includes
arrangement of transportation, freight forwarding, customs clearance, warehousing,
packaging, order processing and reverse logistics. The opinion of the freight
forwarders in this regard is given in the Table 4.13
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 163
Table 4.13 Logistics Functions offered by Freight Forwarders to Shipper
Logistics functions Opinion
Airports Total
CIAL TACC CACC No. % No % No % No %
Arrangementof
Transportation
Always 37 100 27 100 22 100 86 100 Sometimes - - - - - - - -
Never - - - - - - - -
Total 37 100 27 100 22 100 86 100
Warehousing
Always 25 67.57 18 66.67 14 63.6
4 57 66.28
Sometimes 7 18.92 3 11.11 3 13.6
4 13 15.11
Never 5 13.51 6 22.22 5 22.7
3 16 18.61
Total 37 100 27 100 22 100 86 100
Customs Clearance
Always 37 100 27 100 22 100 86 100 Sometimes - - - - - - - -
Never - - - - - - - - Total 37 100 27 100 22 100 86 100
Freight Forwarding
Always 37 100 27 100 22 100 86 100 Sometimes - - - - - - - -
Never - - - - - - - - Total 37 100 27 100 22 100 86 100
Packaging
Always - - - - - - - -
Sometimes 5 13.51 8 29.63 3 13.6
4 16 18.60
Never 32 86.49 19 70.37 19 86.3
6 70 81.40
Total 37 100 27 100 22 100 86 100
Orderprocessing
Always - - - - - - - -
Sometimes 5 13.51 4 14.81 4 18.1
8 13 15.12
Never 32 86.49 23 85.19 18 81.8
2 73 84.88
Total 37 100 27 100 22 100 86 100
Reverse logistics
Always - - - - - - - -
Sometime 13 35.14 5 18.52 3 13.6
4 21 24.42
Never 24 64.86 22 81.48 19 86.3
6 65 75.58
Total 37 100 27 100 22 100 86 100 Source: Survey data
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 164
Table 4.13 reveals that logistics functions such as arrangement of transportation,
customs clearance and freight forwarding are always performed by all the freight
forwarders in international airports in Kerala to shippers. Airport-wise analysis also
shows the same result.
As far as warehousing function is concerned 66.28 per cent freight forwarders
always perform this function; 15.11 per cent sometimes and 18.61 per cent never
perform it. The airport-wise analysis also shows the same results. It shows that 67.57
per cent freight forwarders in CIAL, 66.67 per cent freight forwarders in TACT and
63.64 per cent freight forwarders in CACC always perform warehousing function to
the shipper. 18.92 per cent freight forwarders in CIAL, 11.11 per cent in TACT and
13.64 per cent in CACC sometimes performed warehousing function to shipper and
13.51 per cent freight forwarders in CIAL, 22.22 per cent freight forwarders in
TACT and 22.73 per cent freight forwarders in CACC never perform warehousing
function to the shipper.
Majority (81.40 per cent) of the respondents never perform packaging
function to the shipper. Only negligible number of respondents occasionally does this
and there is none who always does it. Airport-wise analysis also shows the same
results. It shows that 13.51 per cent freight forwarders in CIAL, 29.63 per cent in
TACT and 13.64 per cent in CACC sometimes perform this function and 86.49 per
cent in CIAL, 70.37 per cent in TACT and 86.36 per cent in CACC never perform
packaging function to the shipper. It shows that majority of the freight forwarders
deal with cargo which is packed by the shipper himself. In the case of logistics
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 165
functions such as reverse logistics and order processing more or less the same results
are observable.
The above analysis clearly reveals that only limited logistics functions such
as arrangement of transportation, freight forwarding and customs clearance are
offered by air freight forwarders in international airports in Kerala. All other
functions are performed by the shipper himself.
4.2.10 Auxiliary Services Offered
Auxiliary services offered by freight forwarders consist of insurance
arrangement, analysis of routine and mode of transport, preparation and submission
of documents, payment arrangement with bank and rate negotiation. Responses of
the agents regarding auxiliary services offered are shown in Table4.14
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 166
Table 4.14
Other Auxiliary Services to Shipper
Auxiliary Services Opinion
Airports Total
CIAL TACT CACC
No % No % No % No %
Insurance arrangeme
nt
Always - - - - - - - -
Sometimes 6 16.22 6 22.22 4 18.18 16 18.60
Never 31 83.78 21 77.78 18 81.82 70 81.40
Total 37 100 27 100 22 100 86 100
Analysis of routine
and mode of
transport
Always - - - - - - - -
Sometimes 10 27.03 5 18.52 6 27.27 21 24.42
Never 27 72.97 22 81.48 16 72.73 65 75.58
Total 37 100 27 100 22 100 86 100
Preparation and
Submission of
documents
Always
Sometimes 37 100 27 100 22 - 86 100
Never - - - - - - -
Total 37 100 27 100 22 100 86 100
Payment arrangeme
nt with bank
Always 34 100 21 100 12 100 86 100
Sometimes - - - - - - - -
Never - - - - - - - -
Total 37 100 27 100 22 100 86 100
Rate Negotiatio
n
Always 37 100 27 100 22 100 86 100
Sometimes - - - - - - - -
Never - - - - - - - -
Total 37 100 27 100 22 100 86 100
Source: Survey data
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 167
The analysis reveals that preparation and submission of documents, payment
arrangement with banks and rate negotiations are the auxiliary functions always
offered by all the freight forwarders in international airports in Kerala. Airport-wise
also shows the same result (Table 4.14).
Majority (81.40 per cent) of the freight forwarders never make any insurance
arrangement for cargo to the shipper, 18.60 per cent sometimes do it and none of
the freight forwarders always arrange it. Airport-wise analysis also shows more or
less the same results. It shows that 16.22 per cent freight forwarders in CIAL, 22.2
per cent in TACT and 18.18 per cent in CACC sometimes provide insurance
arrangement to the shipper and 83.78 per cent freight forwarders in CIAL, 77.78 per
cent in TACT and 81.82 per cent in CACC never provide it. The function of analysis
of routine and mode of transport also shows more or less the same results.
None of the freight forwarders in international airports in Kerala always
perform function of analysis routine and mode of transport, 24.42 per cent sometimes
do this and 75.58 per cent never do this. The airport-wise analysis shows that 27.03
per cent freight forwarders in CIAL, 18.52 per cent in TACT and 27.27 per cent in
CACC sometimes perform this and 72.97 per cent freight forwarders in CIAL, 81.48
per cent in TACT and 72.73 per cent in CACC never perform this function to the
shipper.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 168
4.2.11 Freight Forwarders’ Warehouse near the Airport
Freight forwarders who have warehouse near the airport are very helpful
both for the shipper and the consignee. The number of freight forwarders with
warehouse near the airport is given in Table4.15
Table 4.15
Freight Forwarders who have Warehouse near the Airport
Opinion
Airports
CIAL TACT CACC Total
No % No % No % No %
Yes 9 20 5 12.50 4 13.33 18 15.65
No 36 80 35 87.50 26 86.67 97 84.35
Total 45 100 40 100 30 100 115 100
Source: Survey data
It is evident from the Table 4.15 that only 15.65 per cent freight forwarders
in international airports in Kerala have warehouse near the airport. The airport-wise
analysis also shows more or less the same results. It shows that 20 per cent freight
forwarders in CIAL, 12.50 per cent in TACT and 13.33 per cent in CACC have
warehouse near the airport. 80 per cent freight forwarders in CIAL, 87.50 per cent
freight forwarders in TACT and 86.67 per cent freight forwarders in CACC do not
have this desirable facility.
.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 169
4.2.12 Consolidated Cargo
In order to handle small lots of consignment efficiently and competitively,
freight forwarder usually put many consignments into one lot then tender to carrier
for forwarding. This is called consolidation. In this case, each consignment will be
shipped with one House Air Way Bill (HAWB) respectively and all of them will be
under one Master Air Way Bill. Since consolidation reduces transportation costs,
logistics costs also decrease. Opinions of the selected freight forwarders regarding
consolidation of cargo are given in Table 4.16.��
Table 4.16
Consolidation Function Performed by Freight Forwarders
Opinion
Airports
CIAL TACT CACC Total
No % No % No % No %
Always 5 13.51 4 14.82 3 13.64 12 13.95
Sometimes 6 16.22 3 11.11 4 18.18 13 15.12
Never 26 70.27 20 74.07 15 68.18 61 70.93
Total 37 100 27 100 22 100 86 100
Source: Survey data
The analysis reveals that majority (70.93 per cent) of the respondents never
consolidate cargo, 13.95 per cent always do it and the rest 15.12 per cent sometimes
do it (Table 4.16). The airport-wise analysis also shows more or less the same results.
It shows that 13.51 per cent freight forwarders in CIAL, 14.82 per cent in TACT and
13.64 per cent in CACC always consolidate cargo; 16.22 per cent in CIAL, 11.11 per
cent in TACT and 18.18 per cent in CACC sometimes do it.70.27 per cent freight
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 170
forwarders in CIAL, 74.07 per cent in TACT and 68.18 per cent in CACC never
consolidate. In other words, only a limited number of respondent provide cargo
consolidation to the shipper.
4.2.13 Freight Forwarders as Integrated Logistics Service Provider
In air cargo traffic, integrators are agents who oversee the entire cargo
movement process and act as the forwarder and the carrier. In this case the agents
have either own flight or depend on rented flight. But in international airports in
Kerala no freight forwarders provide integrated logistics service to their shipper.
That is none of the freight forwarders have their own flight or rented flight. They
merely act as forwarders.
4.2.14 Type of Carrier available in the Airport for Air Cargo Traffic
In air cargo shipment, there are two types of carrier are used— the freighter
and the combination carrier or belly aircraft. Freighter means carrier used exclusively
for cargo traffic and combination carrier means cargo moved only through belly hold
of passenger aircraft. The major problem of combination carrier is offloading. Types
of carrier available in the international airports in Kerala are given in Table 4.17.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 171
Table 4.17
Type of Carrier used for Cargo Traffic in the Airports in Kerala
Opinion
Airports Total
CIAL TACT CACC
No % No % No % No %
Freighter only - - - - - - - -
Combination carrier only 45 100 37 92.50 30 100 112 97.39
Both - - 3 7.50 - - 3 2.61
Total 45 100 40 100 30 100 115 100
Source: Survey data
Majority of the respondents (97.39 per cent) opine that only combination
carriers are used for air cargo traffic. None of the freight forwarders opine that
freighter service only is used in the airports in Kerala. 2.16 per cent say that both
freighter and combination carrier are used for cargo traffic (Table 4.17). The airport-
wise analysis shows that in CIAL and CACCs only combination carriers are used but
in TACT 7.50 per cent opine that both freighter and combination carrier are
employed. But the analysis reveals that only a negligible number of freighter
services is available in TACT. Thus combination carrier is mainly used for cargo
traffic in airports in Kerala since it is the only available mode of air cargo movement
here.
4.2.15 Agent of all Airlines Operating in the Airports in Kerala
If freight forwarders are the agents of all airlines operating in the airports in
Kerala, it is more helpful to the freight forwarders to negotiate the freight rate which
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 172
benefit to the shipper. The opinions of the freight forwarder in this regard are given
in Table 4.18
Table 4.18
Agent of all Airlines Operating in the Airports in Kerala
Opinion
Airports Total
CIAL TACT CACC
No. % No % No % No %
Yes 22 59.46 17 62.96 14 63.64 53 61.63
No 15 40.54 10 37.03 8 36.36 33 38.37
Total 37 100 27 100 22 100 86 100
Source: Survey data
Table 4.18 reveals that 61.63 per cent freight forwarders are the agents of all
the airlines operating in the international airports in Kerala and 38.37 per cent are not
so. Owing to this the shipper can get cargo space at more negotiated rates. The
airport-wise analysis also shows more or less the same results. It shows that 59.46
per cent freight forwarders CIAL, 62.96 per cent in TACT and 63.64 per cent in
CACC are the agents of all airlines operating in the airport.0.54 per cent freight
forwarders in CIAL, 37.03 per cent in TACT and 36.36 per cent in CACC are not the
agents of all airlines operating in the airport.
4.2.16 Shipper’s Involvement in the Carrier Selection
Some shippers insist the forwarders move their cargo only through a
particular airline or airlines. Opinions of the agents regarding shipper’s involvement
in carrier selection are given in Table 4.19.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 173
Table 4.19
Shipper’s involvement in Carrier Selection
Opinion
Airports Total
CIAL TACC CACC
No % No % No % No %
Yes 13 28.89 11 27.50 9 30.00 33 28.70
No 32 71.11 29 72.50 21 70.00 82 71.30
Total 45 100 40 100 30 100 115 100
Source: Survey data
Table 4.19 reveals that 28.70 per cent freight forwarders opine that shippers
involve themselves in carrier selection and 71.30 per cent opine that there is no
involvement on the part of the shipper in selecting the carrier. The airport-wise
analysis also shows same results. It shows that 28.89 per cent freight forwarders in
CIAL, 27.50 per cent in TACT and 30 per cent in CACC are of the opinion that
shippers have involvement in carrier selection. 71.11 per cent freight forwarders in
CIAL, 72.50 per cent in TACT and 70 per cent in CACC opine that shippers have no
involvement in carrier selection.
4.2.17 Satisfaction of Service of Carrier
Better service from airlines is essential for the smooth flow of air cargo
traffic. Satisfaction levels of freight forwarders with regard to the service of airlines
are shown in the following Table.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 174
Table 4.20
Satisfied with the Services of Carrier/Airlines
Opinion
Airports Total
CIAL TACT CACC
No % No % No % No %
Yes 24 53.33 23 57.50 16 53.33 63 54.78
No 21 46.67 17 42.50 14 46.67 52 45.22
45 100 40 100 30 100 115 100
Source: Survey data
It is observed that 54.78 per cent freight forwarders in international airport in
Kerala under study are satisfied with the service provided by the carrier and 45.22
per cent are not. The airport-wise analysis shows that 53.33 per cent freight
forwarders in CIAL, 57.50 per cent in TACT and 53.33 per cent in CACC are
satisfied with the service of airlines and 46.67 per cent freight forwarders in CIAL,
42.50 per cent freight forwarders in TACT and 46.67 per cent in CACC are not
satisfied with the service of airlines or carrier.
4.2.18 Problems Faced by the Freight Forwarders from the Carrier
Freight forwarders face many problems from the carrier such as off loading,
high freight rate, shortage of cargo space, lack of direct flight and support services in
exporting cargo. The most important problems faced by the agents from the carrier
are given in Table 4.21
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 175
Table 4.21
Problems Faced by the Freight Forwarders from the Carrier for Exports
Problems
Airports
CIAL TACT CACC Total
MeanScore
RankMeanScore
RankMeanScore
Rank Mean score Rank
Shortage of Direct Flight 3.97 1 3.63 2 3.55 1 3.76 1
Shortage of Cargo Space 3.51 2 3.67 1 3.50 2 3.56 2
Offloading 2.78 3 2.63 4 2.59 4 2.69 3
High Freight Rate 2.41 4 2.70 3 2.95 3 2.64 4
Support Service 2.32 5 2.37 5 2.41 5 2.36 5 Source: Survey data
������������������Notes��1.���Results�presented�here�is�the�opinion�of�all�the�sample�freight�forwarders���
�������������������������������������engaged�in�Exports��
� ������������������2.���Ranking�is�done�on�the�basis�of�Weighted�Scores�
� ���������������������3.���Scoring�is�done�as�per�the�following�scale�1st�Rank=5,�2nd=4,�3rd=3,4th�=2,�and���
�������������������������������������5th�=1��
� �����������������4.���Maximum�Possible�Score=N*5�
Table 4.21 reveals that shortage of direct flights is the most acute problem
faced by freight forwarders from carrier for exports of cargo. What comes next is the
shortage of cargo space, off loading, high freight rate and support service. The
airport-wise analysis shows that in CIAL the same result but in TACT shortage of
cargo space is the most important problem faced by freight forwarders, followed by
shortage of direct flight, high freight rate, off loading, and support service. But in
CACC, shortage of direct flight is the most important problem followed by shortage
of cargo space, high freight rate, off loading, and support service.
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 176
4.2.19 Factors considered while selecting the carrier for Exports
Selection of the carrier is based on the number of factors such as availability
of space, direct flight, punctuality, connecting flight, shortest delivery time,
convenient schedule, freight rate and preference of exporters. Table 4.22 reveals the
freight forwarders’ opinion regarding factors considered while selecting an airline.
Table 4.22
Factors considered while selecting a Carrier for Exports
Factors
Airports
CIAL TACT CACC Total
Mean
Score Rank
Mean
Score Rank
Mean
Score Rank
Mean
score
Rank
Availability of space 5.16 1 5.78 1 5.77 1 6.40 1
Punctuality 5.05 2 5.63 2 4.73 3 5.94 2
Direct Flight 4.97 3 4.52 3 4.45 5 5.51 3
Connecting Flight 4.62 4 3.96 6 4.55 4 5.21 5
Shortest Delivery time 4.51 5 4.33 4 5.09 2 5.37 4
Convenient Schedule 4.38 6 4.19 5 3.86 7 4.84 6
Freight Rate 3.70 7 3.67 8 4.23 6 4.55 7
Preference of Exporters 3.59 8 3.93 7 3.32 8 4.19 8
Source: Survey data
��������������Notes�1.�� Results�presented�here�is�the�opinion�of�all�the�sample�agents�engaged�in�Exports����������������������� ��2.�� Ranking�is�done�on�the�basis�of�Weighted�Scores�� �����������3.�� Scoring� is� done� as� per� the� following� scale� 1st� Rank=8,2nd=7,���
����������3rd=6,4th�=5�,�5th�=4�,�6th=3,7th=2and�8th=1�
� �����������4.�� Maximum�Possible�Score=N*8�
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 177
Table 4.22 reveals that the availability of space, punctuality and direct flight
are the major factors considered by the freight forwarder while selecting a carrier for
exports in international airports in Kerala. Freight rate and preference of exporters
are the least preferred factors for selecting the service of airlines. The airport-wise
analysis shows that in CIAL and TACT gives the same results but in CACC,
availability of space, punctuality and shortest delivery time are the most preferred
factor for selecting the service of airlines. In all the three airports freight rate and
preference of exporters are the least preferred factors in the selection of the carrier.
4.2.20 Facilities Likely to be provided by the Airlines for Exports
For smooth movement of cargo at the lowest cost, some more facilities such
as extra space, better tariff, support service and more incentives are required by the
freight forwarders from the airlines. The views of the freight forwarders regarding
the most important facilities needed from the carrier are given in Table 4.23
Table 4.23
Facilities likely to be provided by the Carrier for Exports
Facilities
Airports Total
CIAL TACT CACC
Mean Score Rank Mean
Score Rank Mean Score Rank Mean
Score Rank
More Space 2.92 1 2.78 1 2.82 1 2.81 1
More Incentives 2.70 2 2.33 4 2.68 2 2.55 2
Better Tariff 2.22 3 2.52 2 2.18 4 2.26 4
Support service 2.16 4 2.37 3 2.32 3 2.38 3 Source: Survey data
��������Notes�1.��Results�presented�here�is�the�opinion�of�all�the�sample�freight�forwarders�engaged�in�����������������������������Exports�� ������2.��Ranking�is�done�on�the�basis�of�Weighted�Scores�� ������3.��Scoring�is�done�as�per�the�following�scale�1st�Rank=4,�2nd=3,�3rd=2,4th�=1�� ������4.�Maximum�Possible�Score=N*4�
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 178
It can be seen from the Table4.23 that the most important facility required by
freight forwarders in international airports in Kerala from carrier was more space. It
is followed by more incentives, better tariff and support services. The airport-wise
analysis also shows more or less the same results.
4.2.21 Common Constraints in the Airport for Air Cargo Traffic.
Freight Forwarders face many constraints from the airport for air cargo traffic
in Kerala. The opinions of the freight forwarders regarding common constrains faced
by them are given in Table 4.24
Table 4.24
Common Constraints in the Airports for Cargo Traffic
Airports Total
CIAL TACT CACC Mean score RankMean
score Rank Mean score Rank Mean
score Rank
Inadequate Facilities 4.18 1 4.05 1 3.90 1 4.06 1
Poor Securities 3.62 2 3.70 2 3.57 4 3.63 2
High clearance time 3.58 3 3.25 5 3.30 5 3.39 5
Customs Problems 3.47 4 3.38 4 3.70 3 3.50 3
Tedious formalities 3.13 5 3.45 3 3.77 2 3.41 4
High service tax 3.02 6 3.18 6 2.77 6 3.01 6 Source: Survey data
Notes 1. Results presented here is the opinion of all the sample Freight Forwarders
2. Ranking is done on the basis of Weighted Scores
3. Scoring is done as per the following scale 1st Rank=6,2nd=5, 3rd=4,4th =3 , 5th =2
and 6th=1
4. Maximum Possible Score=N*6
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 179
Table 4.24 reveals that inadequate facilities are the most important constraint
faced by freight forwarders from international airports in Kerala. It is followed by
poor security, customs problems, tedious formalities, high clearance time and high
service tax. Airport-wise analysis shows that in CIAL inadequate facilities are the
most important constraint, followed by poor security, high clearance time, customs
problems, tedious formalities and high service tax. In TACT also inadequate
facilities are the most important constraint followed by poor securities, tedious
formalities, customs problems, high clearance time and high service tax. In CACC
also, inadequate facilities are the most important constraint followed by tedious
formalities, customs problems, poor securities, high clearance time and high service
tax.
4.2.22 Prospects of Development of air Freight Forwarding Business in Kerala
Te opinion of the agents regarding prospects of development of logistics
industries are given in Table 4.25
Chapter-4 Logistics Services Rendered by Freight Forwarders in International Airports in Kerala –An Assessment`
Logistics Management in International Airports in Kerala 180
Table 4.25
Opinion about the Prospects of development of air Freight Forwarding business
in Kerala
Opinion Airports
CIAL TACT CACC Total
No % No % No % No %
Optimistic 34 75.56 31 77.50 20 66.67 85 73.91
Pessimistic 7 15.56 4 10.00 6 20.00 17 14.79
No opinion 4 8.88 5 12.50 4 13.33 13 11.30
Total 45 100 40 100 30 100 115 100
Source: Survey data
The result shows that over 73.91 per cent of the respondents opine that they
are optimistic about the future of logistics industries in Kerala. Only 14.79 per cent
are pessimistic in this regard while 11.30 have no opinion (Table 4.25). The airport-
wise analysis also finds no wide variation in this regard.
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