Expanding Air Freight Horizons by Use of the Airfreight Profitability Factor 740777
The traditional measure of potential for air freight movement of a product is its specific value ($ per lb.). There are other, equally important factors, all of which may be combined into an overall Air Freight Profitability Factor. A total cost model based on the AFPF shows that for most products safety stocks at the destination warehouse should be reduced, surface transportation employed for the predictable portion of the demand, and air freight for the unpredictable portion of the demand. There are substantial new markets for air freight with this concept.