CHAMP Focus Turns to Small, Medium Forwarders, Expanded Integration & a Possible Atlanta Regional HQ
By Karen E. Thuermer, AJOT
Most airlines around the globe have implemented eCargo paperless systems such as those provided by CHAMP Cargosystems. Today, CHAMP is accelerating eCargo adoption within the cargo industry by expanding its focus and now targeting small and midsize freight forwarders.
The reason, said CHAMP Cargosystems CEA John Johnston, is CHAMP can provide very cost effective solutions to this segment of forwarders, particularly those who are doing a lot of air freight,
He emphasized how CHAMP provides global connectivity as well as cargo management systems that support core air cargo processes from operations to revenue management.
CHAMP is focusing on small and midsize forwarders because it can present to them a solid a case for investing in their system.
“It’s amazing, but a lot of small and medium size forwarders still have lean operations from the perspective of how they are deploying their IT systems,” Johnston said during a phone interview with this AJOT reporter from CHAMP headquarters in Luxembourg.
“Getting more into electronic data interchange (EDI) is a cost barrier for them. But that’s something we can address.”
For one, he points out, large forwarders are realizing the benefits of having their own systems that manage their contracts relationships with shippers, the airlines, handlers, truckers, etc. This has eliminated systems that were not good at talking with each other, and vast quantities of paper that could separate from the cargo somewhere during the supply chain.
Prior to the CHAMP system that accelerated eCargo, there was also the problem of interpretation and re-keying errors.
“If someone is writing or copying something into a computer system from a written document, they can make mistakes,” he said. “That can create inherent inefficiencies in the process.”
Information that is captured electronically by the shipper and then sent on to the forwarder can also easily be made available to the airline, even if the airline does not have a contract with shipper.
“This adds efficiencies to the forwarder who typically buys wholesale capacity with an airline and consolidates a number of shipments under one master airway bill,” Johnston stated.
This is particularly important since today information must be accessed much earlier to ensure efficient processes throughout the supply chain.
“Accelerating eCargo is critical to that,” he said. “It gives visibility and control over freight movement. The earlier you get all the detailed information about a shipment, the better you can provide proper planning and provisioning of capacity.”
So how expensive are CHAMP IT solutions to implement?
“Not expensive at all,” exclaimed Johnston. “That’s what’s funny about it. All airlines have their core cargo systems where they can do their booking, capacity management, scheduling, manifesting, etc. All of the ground handlers have core cargo systems that do their warehouse handing and import and export processes.”
Johnston contends that not implementing an electronic system would not only make small and midsize forwarder operations more competitive; it would give them more access.
“For example, we have exclusive messaging deals with the Lufthansa Cargo group, the Air France - KLM cargo group, and Cargo Lux,” he said. “That is a massive amount of capacity where all have electronic connectivity.”
Further, over 70 airlines and more than 300 handling facilities already operate CHAMP’s core systems in 180+ countries.
“Because we provide so many handlers with solutions as well, the key data they need is already available much earlier than they would receive in a traditional model,” he explained.
Johnston contends that companies like CHAMPS particularly offer huge opportunities to forwarders, particularly during today’s economy.
“The status quo is not good enough anymore,” he said. “Companies have to think out of the box, and do things smarter and quicker.”
In the past 18 months, CHAMPS has introduced 2,155 product enhancements for applications as part of its continuous improvement process. Consequently, CHAMP’s Cargo Community Integration Platform is now the largest in the industry. It currently interconnects some 3,000 forwarders and over 200 airlines and other supply chain participants worldwide.
According to a company press release, they exchange some 17 million messages per month. CHAMPS integrated IT solutions and distribution services are linked with more than 3,000 forwarders with over 9,000 offices worldwide. The idea is eventually CHAMP will be able to produce an extremely efficient trading platform where forwarders can do business with airlines.
Consequently, the next step for CHAMPS is enabling services that bring increased return on investments (ROI) through smarter operations. These include data and process quality improvement such as electronic airway bills (eAWB) and e-Bookings portals, as well as mobility solutions. After that come e-Customs and e-Security solutions to support new businesses, business models and processes.
Already 76 airlines use CHAMP’s customs solutions in 35 countries and that 50 percent of all Cargo 2000 shipments are monitored by CHAMP.
The industry has always had a need for quick information regarding the supply chain. But today IT is even more important because of increased requirements to send information electronically to customs officials and for security purposes, particularly in the United States and European Union (EU).
“If the customs authorities feel insecure or do not trust the data they are receiving then they will want to see everything. But if the customs authorities are able to get information early and accurately and are able to make their decisions in regards to shipments coming in, then the process will move a lot smoother,” Johnston said.
The end result: Airports become less congested and cargo flows quickly and safely at a reasonable cost.
A huge benefit to CHAMP is its global footprint.
“We are already implemented worldwide,” Johnston said. “We know how to talk to customs officials.”
Its single interface is particularly beneficial to airlines. Among the company’s services are its air cargo advance customs information forms that are delivered electronically to the appropriate officials of the United States, Canada, Nigeria and Mexico. Other countries for which it is developing customs IT solutions include China, Ethiopia, Kenya and South Africa.
CHAMP Cargosystems’ also has enabled its clients to comply with the European Union Import Control System in all 27 member states of the UE as of last year.
“If an airline has to manage that itself, it is spending a lot of money on interfaces and systems that bring no commercial or competitive advantage. If you multiply each airline having to do exact same thing, it is a total waste of money.”
In an environment where cost control and cost containment is a byword, he sees hooking up to a single gateway system as the most efficient use of investment dollars.
“What we try to do with CHAMP is build trusted communities with secure, reliable and accurate data,” he said. “Airlines have the ability to exhibit a level of cultural sensitivity where ever they go and have local agents representing them. From a CHAMP perspective, that is what we try to offer as well with our global coverage.”
CHAMP is able to deal with local authorities in the local language, and tries, wherever possible, to have local people on ground.
“They are CHAMP employees or people representing us,” he said.
In Europe, these employees operate from CHAMP centers in London, Zurich, Frankfurt and Luxembourg. In Asia, they operate from Singapore, Beijing as well as a large support center in Manila, the Philippines that provides services in English, Mandarin, Cantonese and Japanese. For the last four to five years, CHAMP, which was founded in 2004, has focused its growth on Asia. But today it is turning to the Americas where it is considering opening a region headquarters in Atlanta.
Company officials see Atlanta making a good fit for a number of reasons. For one, SITA, the air transport communications and information technology firm that owns 51 percent of CHAMP, is based in Atlanta. (Luxembourg-based Cargo Lux Airlines owns the remaining 49 percent.) Being on the eastern seaboard, time differences are not so great in terms of reaching Europe as opposed to a location in, say, Los Angeles.
“We can also reach north into Canada and South America,” he said. “Plus, it’s a major hub and the headquarters for Delta Air Lines. Delta affords us good connectivity to other locations.”
But CHAMP is considering other locations as well, including sites in Canada and Latin America. The company has established ties to carriers in Brazil, Mexico and Panama.
Johnston reveals that the decision will be made before the end of the year with an opening as early as possible in 2013.
Currently, CHAMP employs some 350 people worldwide. An indication of its growth, the company has added 108 new positions in the last year.