Building the Ideal Cargo Airport
For many years, the model for driving airport growth and decisions has placed a focal point on the passenger side of the business. It makes sense looking at numbers, as this side of the business drives and generates large amounts of revenue. This leaves cargo, while important, is commonly seen as a byproduct for many airports. The benefits realized from this side chocked up as a side benefit to operating passenger centric services and routes.
So how does the cargo side of the business step out of the shadows of it’s bigger sibling? It may seem like an impossible task, but the template for how to operate a well-run cargo airport is already out there. Facilitating connectivity and building a strong and inviting marketplace are the basic building blocks for success.
Surveying professionals around the world about what airports they see as a model to look at for the ideal cargo airport, and Schiphol’s name will often come up. This Amsterdam based airport has found the right combination when it comes to balancing the needs of both sides of the business, and shines as a beacon for how to properly run a cargo airport.
For a more in-depth look into how and why Schiphol Airport has created become a cargo hub, we were honored to speak with Mr. Jonas van Stekelenburg, Head of Cargo at Schiphol.
Currently, Schiphol holds the title as Europe’s third largest cargo airport. Last year in 2016, the airport achieved record growth with cargo activities contributing to nearly 15% of the bottom line at Schiphol airport. As airfreight continues to play an increasingly important role to airlines, businesses, and economies around the world, Schiphol is well-positioned to take advantage of opportunities when they present themselves.
Mr. van Stekelenburg has helped orchestrate the moves that have helped make Schiphol a preferred airport for cargo in Europe. He explained, “Schiphol Airport is a private limited liability company with the majority of the shares held by the Dutch government. When we began, we explicitly stated that we have both a commercial goal to return a profit, but we also have a societal goal of serving and connecting the Netherlands with all the major business centers in the world. That counts for both passenger flights and for airfreight.”
But why has Schiphol Airport become so good at handling airfreight? For that, we need to go back in history. The Netherlands was built on having an open economy and has long depended on international trade. The country has been operating this way for centuries, and this has translated well for the now massive Port of Rotterdam, which is the largest port in Europe. Through this open trade, the country was able to build up their Port to the status it has today, and the same thing is happening at Schiphol Airport now.
Mr. van Stekelenburg said, “The next important building block to why we’ve been successful, is that we have a government and government agencies that are very trade friendly. For example, customs in the Netherlands have a goal to support business and trade. They explicitly state that they’re actively helping us to optimize cargo at Schiphol. They specifically have a goal to not interrupt seamless flows of cargo at the Port of Rotterdam and Schiphol.”
He continued, “The third and last building block is that we very much at Schiphol have a community approach. I think that has to do with our Dutch DNA, that we always try to compromise with everyone in the room, and to look for interests where everyone gets a share. In these compromises, we try to look for optimization that works for everyone. For example, for almost every project we invite everyone to the table, as everyone has a role to play. There’s almost always going to be contradictions of interest as well, but we’ve been doing this for so long now that we know how to look for shared goals amongst everyone and we work on that shared goal.”
The Dutch mentality and way of working together with all stakeholders involved have substantially added up to the position Schiphol finds itself in. Mr. van Stekelenburg: “Growth brings along many opportunities. Although we are of course pleased with it, this fierce growth has led to an important challenge that we are currently facing: slot scarcity. Schiphol’s slots are limited to 500,000 ATMs yearly up until 2020, an amount that we will reach this year. Hence, we now need to work together even more closely in order to face this challenge and maintain our position in the European airfreight market.
This aspect of a community driven approach is unique, and lends itself well to being able to be built upon. With a solid foundation in place and the support of a community behind it, it’s no wonder that Schiphol has blossomed into what it has become today.
Mr. van Stekelenburg explained further the model at Schiphol. “Our model is different, in that we’ve outsourced almost everything. What we’re doing is directing the whole airport, in essence we are the landlord. We run the airport to make it as appealing as possible for our ‘tenants,’ and to make it appealing and exciting for people to want to come and invest here. “At Amsterdam airport Schiphol we have – for example – an open handling and forwarder market. When building the airfreight community at Schiphol we were open for everybody. We still have such competition, and this had led to competing prices for those using Schiphol. We have a very active and high-quality handling and airline market at Schiphol because of this.”
He continued, “I think that it’s all about listening to what’s going on out there. If you’re really thinking in terms of serving and in terms of trying to attract trade and business, then whatever the business is you’ll find it because the attitude is to serve what’s coming at us. I think that’s really it, the culture of being humble and serving our customers to the best of our ability.”
As Mr. van Stekelenburg mentioned, the Netherlands is a small country without a big manufacturing base and big market behind it, and as such has depended on international trade since its founding. Just take a look at the countries and large industrial powerhouses around the Netherlands, to stay on top the country needs to keep up its precision and attractiveness as a hub for European trade through its sea and airports.
This has led to the country becoming a place where innovation has been key to differentiating themselves. Keeping with the community approach, the launch of Pharma Gateway almost a year ago brought together a large group of logistics pharma service providers with the goal of improving the quality and transparency of pharma throughout the supply chain. Along with attaining IATA’s CEIV certification, an early warning system is being implemented as well now to give even greater vision throughout the entire supply chain.
Mr. van Stekelenburg went onto explain the latest innovation they’re working on is not only for Schiphol, but for Europe as a whole. “We are currently in the midst of implementing a compliance checker system for customs that will be usable for every European country. KLM has been the first to implement it and now we’re working with other airlines and forwarders to implement this system. This system speeds up cargo flows by detecting data errors in air waybills and prevents delays caused by sending non-compliant cargo to customs, which in turn increases data quality, efficiency, and predictability in the supply chain. It’s hard work linking all these processes across all these different countries, but is something we’re committed on doing and is reflective of the types of innovations we will continue to bring to the table.”