CHARACTERISTICS OF THE MARKET FOR INTERNATIONAL AIRFREIGHT IN INTERMODAL LOGISTICS

INTRODUCTION Reviews of the literature of transportation and logistics indicate clearly that efficiency in international intermodal logistics has become increasingly denned by the speed in which components and finished products are moved through the supply, fabrication, and distribution processes. Globalization, increased inventory carrying costs, just-in-time manufacturing, and corporate emphasis on supply chain and channel management have all contributed to a focus on total logistics/distribution costs and an to the emergence of air as a preferred mode of shipment for international dutiables. However, the characteristics of the market for international airfreight in intermodal logistics, as perceived by shippers, remain largely undefined in the professional literature. This article reports on the results of exploratory research seeking to define some of these characteristics. Purpose of the Study This study was an investigation of shipper insights and opinions regarding the characteristics of the market for international airfreight in intermodal logistics in the Western United States. The following questions were asked of participating shippers: 1. What shipment attributes or characteristics do you use most frequently to classify international shipments for movement by air?' 2. What do you think are the most important services provided by integrated carriers and/or freight forwarders. 3. How are integrated carriers and freight forwarders meeting your service expectations? 4. What factors most influence your choice of a specific integrated carrier or freight forwarder? Methodology The primary methodology used in this study was the focus group interview. The preliminary interview guide was developed in a series of interviews with shippers, freight forwarders, and integrated carrier managers. The interview guide was pre-tested in San Jose, California in February, 1996. These pre-tests consisted of three one-on-one interviews of approximately 45 minutes each. The three participants in the test interviews met all criteria established for the recruiting of the focus group participants. The results of the test interviews were used in the finalization of the interview guide. The three test interviews were conducted by the author of this paper. Four focus group sessions were held, two in Seattle (February, 1996) and two in Los Angeles (March, 1996). Five to seven participants were recruited for each session. The author was the focus group moderator for all the sessions. All focus group participants met the following criteria: 1. Were traffic managers or shipping managers that control U.S. outbound freight decision making; 2. Considered themselves "knowledgeable" about international intermodal logistics; 3. Were experienced with a mix of international dutiable shipments of various weights; 4. Had made a minimum of five international dutiable shipments per month of 1-20 pounds, five of 20-100 pounds, and at least five shipments over 100 pounds; 5. Were employed by companies that spent a minimum of $2,000 per month for international dutiable shipments; 6. Had not participated in a shipping related focus group in the past year. RESULTS, SEATTLE FOCUS GROUPS Market Classifications In Seattle, participants were asked how they classify dutiable international air shipments. The categories that emerged in the discussions included weight, size, value, destinations, and time sensitivity. The two variables that shippers utilize most frequently in classifying shipments for international airfreight were identified as: (1) weight and (2) time sensitivity. Participants quickly classified shipments into small, medium, and large weight categories. For these participants, small shipments were those that weighed less than 16 pounds, medium shipments were those that had an average weight of approximately 70 pounds, and large shipments were considered to be anything over 100 pounds (113 pound average). …