Assignment Sample on Air Cargo Operations
Introduction
There are the requirements of transporting goods from one part of the world to another part of the world. The transportation of goods associated within the states or the countries is possible through road transport and railway transport. But, when the transportation should be done internationally, like from one country to another country, then the only option of operating transportation is through the help of the aircraft. It is only possible to use the aircraft to transfer goods from one country to another country. The Air cargo industry is associated with delivering goods from one country to another country. Thus, the people should be able to transport the freight within the country, and the purpose of supplying the goods from one country should be possible. There is also the facility of shipping to transport the goods, but that is a time-consuming procedure. If the air cargo should be used to serve the purpose then, the delivery of the material within the country should be possible within a short period. So, the demand of the air cargo industry should always be high in case of using it as a courier service provider. DHL is a well-known air cargo firm associated with the transportation of goods within the countries.
Brief profile of DHL
DHL is the company associated with the delivery of the packages internationally and the provider of the “express mail service”.The setting up of the company was done in the year 1969, in San Francisco, within the continent of the USA. Thus, the company is ancient in providing courier service throughout the world. The company is so famous in its field of operation that the company is associated with the delivery procedure of nearly 1.5 billion parcels every year (Ayasanond et al.2019). The primary aim of the company was to deliver within the intercontinental and offshore. Still, after achieving success in the field of FedEx, the company started the expansion outside the US. Several business units are associated with the DHL air cargo like “DHL global forwarding” and “DHL supply chain”.
The management procedures associated with the DHL are very smooth. The entire operations from the packaging of the materials to the distribution are associated with several stages, as shown in the above figure.
If the company’s brand value is shown in the graph, it should be observed that continuous increment occurs throughout the years of the company (Chuepan et al., 2019). In the year 2014, the brand value was shown nearly fifty-one thousand, if he graph is observed for the year 2015, it should be shown that the brand value has increased upto the level of fifty-four thousand, and finally in the year 2016, it was stuck to the point of the fifty-six thousand.
From the above graph, the estimation regarding the financial performance of the company should be done quickly from the year 2005 to the year 2020. The higher performance regarding finance was observed within the year 2005 to the year 2008 (Baxter et al., 2019). But, after the year 2008, the gross yearly income has reduced to a considerable level, and the financial condition of the company should have to be able to meet all of the business needs.
SWOT analysis
| Strengths | Weakness |
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| Opportunities | Threats |
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Table 1: SWOT Analysis
(Source: Self-created)
Explanation
Strengths
DHL is a renowned company in the field of air cargo operations, and the establishment of the company was done in the year of 1969. The company is actively engaged in the delivery of several goods within the countries, and the quality of service provided by the company is very much systematic. The company is expanded throughout the world as a leading organization in the case of delivering the materials throughout the world. The company is thus top-rated, and the brand value of the company is constantly increasing on a yearly basis. The entire network is operated within the territory of 220 countries (Pandey, 2021). Therefore, the annual income of the company should always be higher, and the improvement on the income should always be supportive in case of enhancement as well as expanding the business worldwide. An adequate level of communication exists within the several branches of the company. An effective communication strategy is also observed in the case of connecting to the clients. The innovative procedures are always observed with regards to the company service, and that is probably the best way of survival of the company within the market of the tough competition. Solid and skilled management personnels and a well-developed supply chain are also other things of the success of DHL. The leadership within the market is also observed is managed by skilled laborers as well as managers.
Weakness
The ownership of the company is totally private, and the company is not also associated with the sponsors of the government. There are several air cargo companies developed in the international markets, and most of the companies are either owned by the government or sponsored by the government. DHL is forcing a solid level of competition from these government-aided companies. As DHK is expanded over 220 countries, several operations should be performed, which should require help from several government organizations to be operated within the customized environment (Kjønnø et al., 2017). Market share of the company regarding the expansion of the business is limited as the government’s own organizations are getting first priority in case of expanding the business using the market share. DHL has to depend mainly on several external agencies due to the controlling operations of the aircraft and serving the delivery procedure to the customers. The necessity of getting permission from the regulator bodies is also required to maintain the service effectively so that the customers should be satisfied with the services offered by DFL. Thus, several weaknesses are observed as the company is not associated with the government regulatory bodies.
Opportunities
There are several opportunities that are observed regarding the operation of DHL. The facility to tie up with several business and corporate houses already existed as the company is not associated with the government organizations, and the operations of the company regarding serving the customers are done by private management along with the supply chain. There are also opportunities to globally expand the business activities as the company is already operated within the territory of the 220 countries, and the company is very much prevalent within these countries. If financial markets are studied, it should be shown that the company has the ability to expand within the financial market with its proper management and maintaining skills. As the people are now come to order from several countries with the usage of the electronic gadgets easily, there is always the chancers are observed to increase the number of orders and thus to expand the business (Perenc et al.2018). There are several emerging markets which should be considered as the hub for DHL to be expanded abroad, and it should be able to serve more countries than which existed till now. In this way, more takeovers should be done on the services as well as products. Thus, the opportunities are enough for DHL to be expanded worldwide and thus improve the business facilities.
Threats
Natural calamities along with the rough economic condition of the world should be the cause of the air cargo company DHL. Natural calamities may be the cause of the obstruction of the flying operation of the cargo flight. If the flying operations should be ceased, then it should be impossible for the delivery procedures to be conducted, and thus, the company shall be adversely affected. There are several companies with government-supported organizations in case of operating the business s procedures as the government-owned organization should be able to avail several benefits than the privately-owned organizations in case of conducting the freight service worldwide (Zhang et al.2017). If the economic slowdown should be observed, then the people should not be able to order the goods from foreign countries, and thus the business procedure should be highly affected as without the requirements of the client, the delivery should not be possible, and the entire business of DHL is dealing with the delivery of several goods to the clients. The political factor and increment of taxes may also have a negative effect on the DHL company. If the taxes for entering the foreign goods in the country is increased in any of the countries then, the people of those countries should not like ttompurchse the goods from the other countries as the burden of the tax should be borne by the customer who is associated with the orders in DHL.
Evaluation
As discussed in the previous parts, there are strengths and opportunities as well as the weakness and threats that are observed if the case study is performed of air cargo company DHL. As the company is operated privately, there are several opportunities observed, like a tie-up with renowned businesses as well as corporate houses. The opportunities are also observed for the global expansion with the help of the country where the company is operated successfully along with the trust of the customers. The company is placed in the position of fifty among the cargo companies worldwide according to the report of several magazines.
But, there are also several threats observed, and one of the main reasons for the threats is that the company is operated by the private owners, and other companies are operated with the help of the government (Świszcz et al.2017). So, there are more opportunities received by other companies during the continuation of the operating procedures than DHL. As the operation of the cargo airlines is associated worldwide, there is always a necessity to be operated with the help of the sponsorship of several government organizations. So. it’s necessary to arrange for the necessary requirements so that DHL should also be able to get the several beneficial effects from the governmental organizations in case of running the business procedures within the countries. If a sufficient amount of governmental facilities should be provided to DHL, it should be possible for the company to expand the area of the business more rapidly than the previous one.
Conclusion
Air cargo companies are associated with the delivery of goods within several countries, and the operations are performed by the several aircraft associated with the companies. DHL is a type of company which is associated with the delivery of goods within several countries. The head office of the company is situated in the country of San Francisco, and the operations are expanded to over 220 countries over the world. So, the several strengths, weaknesses, opportunities, and threats associated with the performance of the business are analyzed to determine which area should be developed more for expanding the business.
Reference List
Journals
Baxter, G. and Srisaeng, P., 2018. Cooperating to compete in the global air cargo industry: The case of the DHL express and lufthansa cargo ag joint venture airline ‘AeroLogic’. Infrastructures, 3(1), p.7.
Baxter, G., 2019. A strategic analysis of Cargolux Airlines International position in the global air cargo supply chain using Porter’s Five Forces Model. Infrastructures, 4(1), p.6.
Baxter, G., 2019. Capturing and Delivering Competitive Advantage in the Japan to Europe and Europe to Japan Air Cargo Markets: The Case of the ANA Cargo and Lufthansa Cargo AG Strategic Joint Venture. MAD-Magazine of Aviation Development, 7(2), pp.6-21.
Bombelli, A., Santos, B.F. and Tavasszy, L., Analysis of the Air Cargo Transport Network using a Complex.
Chuepan, A., Hariramakrishnan, L., Kamrul, H. and Bhupesh, L., 2019. An Assessment of Air Cargo Industry and Future Perspectives in Thailand. Available at SSRN 3399828.
Kjønnø, A.M. and Pham, D.T.H., 2017. The potentials of last mile logistics by the use of cargo bikes in the city center of Oslo: a case study of dhl express (Master’s thesis, BI Norwegian Business School).
Pandey, R., Ganatra, V., Sonawane, H., Fauzi, F.N.B.M., Kee, D.M.H., Yasir, N.H.B.M., Suhairi, N.F.F.B. and Zamri, N.A.A.B.M., 2021. The Impact of Global Trend on Courier Service and Consumer Satisfaction: A Study of DHL. International journal of Tourism and hospitality in Asia Pasific (IJTHAP), 4(1), pp.64-72.
Perenc, J., 2018. Logistics as a tool to improve the competitiveness of DHL services. European Journal of Service Management, 27(3/2), pp.339-346.
Pohorilyi, F., 2020. Organization of cargo transportation of the airline.
Świszcz, A., 2020. International cargo air transport. Transport Economics and Logistics, 83, pp.105-113.
Zhang, C., Xie, F., Huang, K., Wu, T. and Liang, Z., 2017. MIP models and a hybrid method for the capacitated air-cargo network planning and scheduling problems. Transportation Research Part E: Logistics and Transportation Review, 103, pp.158-173.
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