The network is key to GSSA's expansion, says ECS
17 / 11 / 2016
General sales and service agency (GSSA) ECS is hoping its recent network expansion will help fuel future growth as airlines increasingly require global sales services.
The company’s chief executive and chairman, Bertrand Schmoll, said that over the last 15 years ECS had grown to have a presence in 47 countries from just four in 2001.
Most recently, the GSSA acquired Asian specialist AVS as it looked to expand its presence in the Southeast Asia region.
AVS consolidates cargo from the ASEAN region on its network of flights and interlines to the rest of Asia, Europe and the US.
Its main hub is Bangkok, and its office network also includes Taipei, Hong Kong, Yangon, Phnom Penh, Jakarta, Kuala Lumpur, Penang, Manila, Cebu and India.
Schmoll said having a large network, but with good local market knowledge would be key to the company’s future expansion.
“For me there are two things that are important for a GSSA,” he said. “The first is the network because when you want to make an offer to an airline you must have this network and you must also control this network. That's why it’s important you have your own representation and not just commercial agreements.
“The second point is that the GSSA business will remain local because if locally you have poor management and poor governance you will have problems with the airline.
“So what is important is the selection of the manager and to have the best manager in each country.
“That's why I'm very happy with the acquisition of AVS because I think it's a really good professional organisation.”
He said that is was essential that if a GSSA wanted to offer a total cargo management service – where an airline outsources the entire cargo operation – then “you must control your sales staff and you must control your offices”.
“This year we have expanded strongly and the figures have increased, but I think that we will see them increase even more in the future,” he added.
“We have the stone to grow now we have the network. This year we have spent our time putting the strategy for the growth in place.”
Schmoll added that he expected the outsourcing of cargo sales to grow over the coming years because of the amount of belly capacity that is coming on-stream.
This will lead to lower prices and therefore airlines will look to outsource the cargo sales business to reduce costs and also try to fill the cargo holds.
ECS Group chief operating officer Adrien Thominet added that the AVS acquisition would benefit its existing customers as it would now be able to feed in cargo from across the Southeast Asia region.
This is also helped by one of its big contract wins in 2016 – a deal to provide Singapore-headquartered low cost carrier Jetstar Asia with a total cargo management solution.
Jetstar Asia currently has 18 A320 aircraft in its fleet, operating more than 600 weekly return flights across 25 destinations in 13 countries.
“With the AVS acquisition we are suddenly have access to the Southeast Asia market, which is one of the booming areas of Asia,” Thominet said.
“Through the acquisition we immediately have offices, we have a trucking system to connect with the main gateways like Saigon and Bangkok and then we have Jetstar Asia feeding from those places to Singapore.
“Immediately − we are the GSA of Finnair flying out Singapore − we give [Finnair] access to those markets instead of just fighting over the Singapore-Europe market.”
Thominet sees future opportnites to capitalise on the low-cost market – in certain areas – despite the quick turnaround times required.
He said that Jetstar had adjusted its turnaround times to a minimum of 40 minutes in order to give ECS enough time to load and unload cargo.
In Europe, however, it was more of a challenge because of the trucking network that already provides links between various airports.
Thominet added that GSAs must be flexible to customer needs – and not offer a one-size-fits-all service – and look to be innovative, particularly through their use of IT.