Apple Appeal

Apple announced mouth-watering net quarterly profits of $18bn for the final three months of 2014.
That staggering 38 per cent rise in profit was due mainly to the 74.5m iPhones sold to eager consumers.
While the financial pages focused on the figures, little mention was made of the supply chain logistics that enabled Apple to keep its global customers happy as they clamoured for the latest in mobile phone technology.
Due to strict commercial contracts enforced by Apple for security reasons – its high value inventory is a magnet for criminals – the air cargo and logistics industry is unable to crow about its achievements in delivering the goods.
We see glimmers of the ‘iPhone effect’ when the Asia Pacific airlines publish their combined results, but few specifics.
Of course, there is another issue. One wonders whether those component parts of the supply chain, the airlines, airports, freight forwarders and ground handlers share in the profits bonanza. The answer is a resounding no.
No wonder IATA wants to discuss why the air cargo industry carried a record 51.3m tonnes in 2014, while the $62bn generated in cargo revenue was still $5bn lower than the peak year of 2011.
The hard truth is that shippers are in cut-throat competition and that an easy target in trimming costs is the logistics supplier, often engaged in its own battle with rival operators.
With bellyhold capacity now plentiful and growing, the pressure on airfreight rates will increase.
The industry has to adopt a different price model for bellyhold. Recent history has taught air cargo some painful lessons about market transparency, but airfreight remains a premium product with a less than premium price.