FACTORS INFLUENCING FORWARDERS’ CHOICE OF AIR CARGO TERMINALS Essay

1.aˆˆINTRODUCTION

With the stiff competition in the air lading industry in Taiwan, air ladings terminal operators at the Taoyuan International Airport ( TIA ) need to set their concern schemes depending on the altering logistics demands and the competitory environment if they want to keep or better market portion. At present, competition in the export air lading concern at the TIA is cut-throat. There are a figure of jobs that challenge the air lading concern, one of which is the limited growing in the volume of air ladings imported and exported by Taiwan. As the overall economic system of Taiwan alterations, air ladings terminal operators similarly face the of import issue of seting their relevant services in clip to run into clients ‘ demands and to react to turning competition.

With respect to importing, through the TIA, the ladings are normally handled by subordinates of the pudding stone to which the airliner belongs. For illustration, the transship ladings carried by China Airlines and its spouses are largely handled by the Taiwan Air Cargo Terminal Co. , Ltd. ( TACT ) . Similarly, the ladings carried by EVA Airways and its spouses are handled by Evergreen Air Cargo Services Corp. ( EGAC ) . A different system is observed with respect to exportation, nevertheless. Most export goods are taken attention of by air lading forwarders, which select their favorite air lading terminuss. The aim of this paper is to find the factors act uponing forwarders ‘ pick of air lading terminuss and to assist the air cargo terminal operators obtain competitory advantage.

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2. LITERATURE REVIEW

The different factors that influence air lading forwarders ‘ pick of terminuss for their minutess are based on a comprehensive reappraisal of the literature and treatments. Included in the beginnings of informations are diaries, proficient studies, books, and statistics published by the Civil Aeronautics Administration of Taiwan.

2.1 Literature Review

There are merely a limited figure of documents focused on the direction and schemes of air lading terminuss. Lillie and Sparks ( 1993 ) discussed air lading forwarders ‘ pick of airliners. Schwartz ( 1998 ) investigated the challenges faced by air lading forwarders under the planetary logistics construct. Zhang and Zhang ( 2002 ) discussed in their two surveies the issue of deregulating and liberalisation in the air lading industry. Lee and Lee ( 2003 ) studied the development scheme of doing Incheon International Airport the centre of regional operations and economic system. The survey made by Zhang ( 2003 ) concluded that there are two major factors considered by shippers utilizing air conveyance in their pick of terminus, and these are rapid bringing and low harm rates. Consequently, the other factors act uponing the competitory advantages of air lading terminuss are geographical location, cost, and conveyance clip. While discoursing the competitory advantages of Hong Kong Airport when it was being developed into an international air lading hub, the factors considered have been expanded to seven: geographical location, cost, conveyance clip, substructure, imposts efficiency, multimodal conveyance, and air conveyance policy. The above-named surveies did non sufficiently touch on the concern schemes that air cargo terminuss should follow to derive competitory advantage.

2.2 Air Cargo Terminal Operators in Taoyuan Airport

Taoyuan International Airport has four air lading terminuss, viz. , Taiwan Air Cargo Terminal ( TACT ) , Evergreen Air Cargo Services Corporation ( EGAC ) , Farglory Air Cargo Terminal, and Ever Terminal Co. , Ltd. The one-year throughput of air lading terminuss in old old ages was falling below the expected volume, therefore bring forthing serious competition among operators.

Meanwhile, two air lading terminuss, TACT and EGAC, which are sister companies of air hose operators and manage most import ladings. With respect to the export concern, the advantages enjoyed by terminus operators that have ties with air hose operators are non every bit evident as in the import concern. For illustration, in February 2008, the market portions of Farglory and Ever Terminal, which do non hold ties with air hose operators, were much higher than those of the other two. EGAC, supported by EVA Air and its spouses, handled around 3,000 dozenss of export ladings, equivalent to merely tierce of the ladings handled by its major rivals.

3. RESEARCH DESIGN

3.1. Questionnaire Design Procedure

This survey obtained pertinent informations by administrating study questionnaires. At the first phase, all factors relevant to this survey were collected, while irrelevant 1s were disregarded. The pre-test questionnaires that included preliminary factors were distributed to senior directors to assist the writer select the factors to be used in this survey[ 1 ].

Based on the consequences obtained from the pre-test questionnaires, there were nine factors that had to be disregarded. The dependability of the preliminary factors was analyzed based on the AHP construction. After analyzing the dependability of the factors at the hierarchal dimension, they were farther summarized into three dimensions in bed 2, viz. , corporate resource, concern direction, and service quality and working environment. These dimensions are compared in braces to find their relevancy.

In decision, nine factors in bed 3 have been chosen from the pre-test questionnaires. These factors are the undermentioned:

( 1.1 ) Location and geographical place: whether the terminus is located within the airdrome boundary ;

( 1.2 ) Corporate image and vision: whether the terminus has positive corporate image and vision to pull possible clients ;

( 2.1 ) Flexible charge: whether the directors charge clients at a lower ball sum monetary value or could offer more price reductions to clients ;

( 2.2 ) Storage and logistics direction efficiency: what is the degree of efficiency of the operations undertaken in the terminus ;

( 2.3 ) Customss efficiency: whether review of the ladings by usage officers could be done rapidly and even with a short notice of reaching.

( 3.1 ) Customized service: whether the terminus could supply excess services requested by forwarders and lading proprietors ;

( 3.2 ) Efficiency and quality of export operations: whether the export ladings are handled expeditiously and received at the airdrome of discharge in good status ;

( 3.3 ) Storage system and equipment: whether the terminus is equipped with modern and well-functioning storage system ;

( 3.4 ) Warehouse working environment: whether the working environment of the warehouse is pleasant, clean, and safe.

The entire dependability coefficients ( Cronbach ‘s alpha ) of the aforesaid inquiries are all above 0.6 ( as shown in Table 1 ) ; hence, they are rather dependable.

Table 1 Structure of AHP Analysis and Reliability Coefficients

Layer One

Layer Two

Layer Three

Factors considered

1. Corporate Resource

1.1 Location and geographical place

Cronbach ‘s alpha

0.8831

1.2 Corporate image and vision

Cronbach ‘s alpha

0.6616

2. Business Management

2.1 Flexible charge

Cronbach ‘s alpha

0.6545

2.2 Storage and logistics direction efficiency

Cronbach ‘s alpha

0.8834

2.3 Customss clearance efficiency

Cronbach ‘s alpha

0.7221

3. Service quality and Working environment

3.1 Customized services

Cronbach ‘s alpha

0.7841

3.2 Efficiency and quality of export operations

Cronbach ‘s alpha

0.8778

3.3 Storage system and equipment

Cronbach ‘s alpha

0.6101

3.4 Warehouse working environment

Cronbach ‘s alpha

0.8824

Cronbach ‘s alpha of entire factors

0.9644

4. Statistical Analysis

4.1. Questionnaire Recovery

A sum of 59 questionnaires were retrieved out of the 63 questionnaires distributed, bespeaking a entire recovery rate of 94 % . There were 38 valid and 21 invalid questionnaires, bespeaking a valid sample recovery rate of 64 % .

For the directors of air lading terminuss, a sum of 29 questionnaires were collected out of the 33 questionnaires distributed, bespeaking a recovery rate of 88 % . From the 29 retrieved questionnaires, 19 were valid and 10 were invalid, with a valid questionnaire recovery rate of 66 % .

For the directors of air lading forwarders, 30 questionnaires were distributed, and all were collected successfully, stand foring 100 % recovery rate ; nevertheless, from the retrieved questionnaires, 19 were valid and 11 were invalid, therefore, the valid questionnaire recovery rate is 63 % . The inside informations of these are presented in Table 2.

Table 2 Summary of Number of Recovered Questionnaires

Term

Questionnaires distributed ( transcript )

Questionnaires collected ( transcript )

Recovery rate ( % )

Valid questionnaires ( transcript )

Terminal Operators

33

29

88

19

Forwarders

30

30

100

19

Entire

63

59

94

38

4.2 Consequences of the AHP Analysis

4.2.1 Comprehensive Analysis

Table 3 shows that air cargo terminus operators ‘ perceptual experience differs from that of air lading forwarders. However, it can be concluded from the information that both believe that the “ efficiency and quality of export operations ” is the most of import factor. This point of service is the major demand demanded by air lading forwarders, and air cargo terminus operators exert attempt to run into such demand.

Air cargo terminal operators believe that the 2nd most of import factor is “ storage and direction efficiency ” , while air cargo forwarders believe it is “ location and geographical place ” of the company. Air cargo terminal operators believe that better direction of “ storage and logistics ” could efficaciously pull export concern. On the contrary, air lading forwarders consider the “ location and geographical place ” of air lading terminuss as even more of import. This means that if the terminus is non located within the airdrome boundry, the possible hazards and conveyance clip due to transporting distance will increase, cut downing the involvement of forwarders to choose this terminus.

Air cargo terminal operators believe that the 3rd most of import factor is “ efficiency of imposts clearance. ” In pattern, the synergistic relationship between air lading directors and imposts officers stationed in the terminus would earnestly act upon the efficiency of imposts clearance. If a bad relationship exists between terminus directors and imposts officers, the imposts officers will look into the ladings merely after they have accumulated in order to salvage clip and attempt in traveling to put where the ladings and paperss need to be inspected. This will earnestly cut down the efficiency of imposts clearance. On the other manus, if a good relationship exists between the two, imposts officers will look into the ladings as they arrive and without waiting for ladings to roll up. This will shorten the clip required to acquire a imposts clearance.

However, cargo forwarders believe that the “ customized services ” provided by air ladings terminus operators are more of import. By and large talking, the customized services required by forwarders from terminal operators entail extra charges, and lading forwarders ever expect the terminus to supply such excess services for free. From the point of view of terminus operators, the demand for “ customized service ” , which varies by ladings and forwarders, require extra operational cost and clip, therefore adversely poignant net income. This explains why “ customized service ” ranked 8th in the factors considered by terminal operators as most of import in deriving market portion.

Under the force per unit area of worsening of air lading volume at the Taoyuan International Airport, “ scheme of distinction ” should be considered to beef up the fight of the terminus. The terminus operators could delegate more installations and forces to run into the demand for assorted “ customized services ” . By presenting “ customized services ” , the terminus operators will be able to pull forwarders more easy.

Table 3 Comparison between Terminal Operators and Forwarders

Second bed

Evaluation standard

Overall weight

Difference

Terminal operators

Sequence

Forwarder

Sequence

Company resources

Location and

Geographic place

0.1098

4

0.2308

2

2

Company image

and prospect

0.0777

5

0.0674

6

1

Operation and direction

Flexible charge

0.0665

6

0.0520

8

2

Storage and

logistics direction efficiency

0.2032

2

0.0571

7

5

Customss clearance efficiency

0.1761

3

0.1063

4

1

Service quality and

working environment

Customized service

0.0506

8

0.1157

3

5

Efficiency and quality of export operations

0.2185

1

0.2519

1

0

Storage system and equipment

0.0552

7

0.0800

5

2

Working environment of the warehouse

0.0424

9

0.0386

9

0

5. Decision

Air lading terminuss at the Taoyuan International Airport have evolved from being inactive histrions during the period of economic monopoly in 1972 to being active participants in a free market, and from holding merely one public air cargo terminus to holding four private air lading terminuss at present. To pull more clients, nevertheless, they must supply the services that meet the demands of forwarders.

The findings of this research show that air cargo terminus operators value three factors that will impact lading forwarders ‘ pick of terminus: ( 1 ) operation efficiency and quality of export lading, ( 2 ) storage and logistics direction efficiency, and ( 3 ) imposts clearance efficiency. On the other manus, air lading forwarders believe that the top three factors relevant in choosing terminuss are as follows: ( 1 ) operation efficiency and quality of export lading, ( 2 ) location and geographical place, and ( 3 ) customized services. The findings of this research are about similar to those of the survey conducted by Zhang ( 2003 ) , which said the major factors considered by shippers in choosing terminuss are rapid bringing and low harm rates. Harmonizing to the findings of this research, together with the findings of Zhang, “ operation efficiency and quality of export lading ” are the major concerns of shippers and forwarders in Hong Kong or Taoyuan.

To happen the grounds behind the differences between the perceptual experiences of terminus operators and forwarders, senior directors were interviewed. The consequences showed that the differences were caused by changing involvements and force per unit areas. Terminal operators must keep efficient and cost-efficient operations. The consequences of the questionnaire analysis reflect their major concerns. However, air lading forwarders expect customized service for lading proprietors and convenience for their concerns. Given the spread, the challenge faced by terminus operators in order to pull forwarders is “ how to supply “ customized services ” at sensible cost ” . Since 2008, under the force per unit area of worsening air lading volume at the Taoyuan International Airport, some of the terminus operators have become more antiphonal to the demands of forwarders, such as “ customized service ” . For case, several moderate-sized air-conditioned warehouses were built by Farglory for the storage of fabricating machines to be used in Hsinchu Science Park.

Four air lading terminuss at the Taoyuan International Airport are viing tightly for export ladings. Air cargo terminus operators suffer non merely from limited growing in the volume of export ladings in Taiwan, but besides from the fact that supply is higher than demand. For the intent of deriving competitory advantage, terminus operators could utilize the findings of this survey to pull more clients. This survey chooses the Taoyuan International Airport as mark and analyzes the factors that influence the pick of terminus by lading forwarders. For a better apprehension of the perceptual experiences related to the pick of air lading terminuss, it is recommend that future surveies should cover major airdromes in Asia and compare consequences with those of the current survey.

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