A recent visit to Faversham in Kent to see their copy of the Magna Carta prompted me to think about something that has changed remarkably little over centuries: the relationship between trade and prosperity.
Faversham's historic market charter recognised the market as important economic infrastructure. It was not simply somewhere to buy things. It brought buyers and sellers together, created employment and provided a place where goods could be exchanged, transformed and sold.
Silk, imported by ship, could pass through merchants, warehousemen, dyers, designers and tailors before becoming a finished garment. Each stage added value and created economic activity. The same principle helped make Venice, London and countless trading towns prosperous.
Today, global commerce works very differently. A finished garment can be manufactured thousands of miles away, purchased through a digital marketplace and delivered by air directly to a consumer.
The intermediate stages have not simply become more efficient they have, in many cases disappeared.
For air cargo, the industry is increasingly being asked to provide the physical infrastructure of global retail.
From cargo to millions of parcels
Air cargo was built around consolidation. Shipments were assembled into pallets and containers, with aircraft capacity used to move relatively high-value or time-critical goods efficiently.
E-commerce changed that process with the industry now handling enormous numbers of individual cross-border parcels, often of very low value.
Instead of one consolidated consignment for a distributor, the network may be moving thousands of individually addressed purchases, each requiring its own data, handling, customs treatment and final delivery.
Aircraft may look much the same, but the logistics system around it does not.
Airports will increasingly need automated sortation, parcel-processing facilities, customs capability, security screening, digital connectivity, courier interfaces and additional landside capacity. Cargo terminals are becoming, in effect, parcel factories.
A pallet destined for one consignee can become hundreds of individual movements through a highly automated network.
Customs authorities face a similar transformation, processing a vast number of individual transactions, declarations, taxes, duties, product descriptions and returns.
A tonne of e-commerce cargo can impose a very different burden from a tonne of conventional consolidated cargo.
Inventory in motion
As physical retail has contracted, inventory once held in shops has moved into warehouses and fulfilment centres. Increasingly, however, inventory is also being kept moving.
An aircraft is not literally a warehouse but has become part of a system in which inventory is held in motion rather than at rest. The traditional model might have been:
manufacturer → warehouse → distributor → shop → consumer
The e-commerce model can increasingly look like:
manufacturer → fulfilment centre → aircraft → parcel hub → consumer
We are beginning to see a different inventory model: inventory in motion.
But have we reduced the cost of holding inventory or simply exchanged the cost of warehousing for the cost of moving it?
This question matters to air cargo because transport capacity increasingly becomes part of the inventory strategy.
Aircraft are not merely moving products; they can form part of the system that keeps inventory moving towards demand.
Who is paying for speed?
This model requires extraordinary infrastructure to deliver an apparently simple proposition: a very cheap product, very quickly, directly to an individual.
Which raises a difficult question: who is paying for speed?
If the consumer pays little or nothing for delivery, the cost has not disappeared. It is being absorbed somewhere within the system by platforms seeking market share, logistics providers operating at scale, airlines seeking volume, airports investing in infrastructure, governments processing customs transactions, or society through environmental and infrastructure costs.
The commercial sustainability of the model therefore deserves as much scrutiny as its environmental sustainability.
From value chains to delivery chains
There is a broader economic question too. Historically, international trade often created value chains within the places through which goods passed. Imported materials supported merchants, warehouses, manufacturers, craftspeople and retailers.
E-commerce has not eliminated value creation; it has relocated it.
The market has moved from a physical place to a digital platform. Manufacturing and fulfilment may be thousands of miles from the consumer. The airport becomes a processing node, the aircraft a link in a global inventory system and the delivery vehicle the final connection.
We have, in effect, moved from a value chain to a delivery chain.
This is not inherently negative. Globalisation has delivered enormous benefits, including lower prices and access to products previous generations could not have imagined.
Whilst the physical marketplace once provided a place where economic value could accumulate locally, the digital marketplace can connect a consumer directly to a distant manufacturer, bypassing many of the businesses that once stood between them.
The challenge is not to recreate the past, but to understand what forms of value creation the new system might support.
Who governs the marketplace?
Historically, markets operated within places. They had rules, licences, taxes and, sometimes, charters.
Faversham had its market charter, and it also had smugglers attempting to evade tax. Attempts to regulate trade have never been perfect.
Today's marketplace is different. It may be privately owned, digitally controlled and global. Platforms determine what consumers see, how products are presented, what delivery experience is promised and how the logistics behind that promise operate. Yet the physical consequences remain stubbornly local.
Airports need capacity. Customs authorities need resources. Roads need maintaining. Warehouses need land. Aircraft need fuel. Communities experience congestion and environmental impacts.
The marketplace is global, but much of the infrastructure supporting it is local and national.
This makes simple solutions difficult. Changing de minimis thresholds, VAT or import duties may influence the economics of ultra-low-value shipments, but unilateral action can simply encourage traffic to move through another jurisdiction. Global e-commerce is extraordinarily good at finding the path of least resistance.
What might a sustainable model look like?
There is no simple regulatory switch that can make global e-commerce sustainable. A government can change its tax, customs or environmental rules, but it cannot unilaterally dictate how a global platform fulfils an order.
Meaningful changes to the economics of ultra-low-value cross-border trade would require international agreement, unlikely any time soon.
In the meantime, the industry has a different choice: how it responds to the demand that already exists.
Air freight is extraordinarily valuable when speed has genuine economic value: pharmaceuticals, perishables, urgent industrial components and other time-critical supply chains justify the cost and environmental impact.
But not every low-value purchase needs to cross continents by air. Where products are inexpensive, non-urgent and readily consolidated, other modes may make greater economic and environmental sense. The challenge is not to dictate the consumer's choice, but to ensure choices are visible.
Airlines, airports and logistics providers can influence outcomes through the infrastructure they build, the services they offer and the capacity they make available. They cannot determine the future of e-commerce, but neither are they powerless within it.
Ultimately, a sustainable model may require international agreement on the responsibilities of the platforms that increasingly control global commerce, alongside clearer recognition of the infrastructure and environmental costs generated by the promises they make.
The real sustainability question
There is a deeper risk.
If a small number of global platforms capture an increasing share of the value created by commerce, consumers become increasingly dependent upon them, and the physical infrastructure supporting them is funded and maintained more widely, we could end up with an economy exceptionally efficient at moving goods but less effective at distributing economic value.
That is not inevitable. Nor is it an argument against digital commerce. It is a reason to ask what we want our marketplaces to achieve.
For centuries, places such as Faversham prospered because trade did more than move goods. It created opportunities for people to add value.
The digital marketplace has changed that geography. The marketplace is now online, the warehouse is distributed and the inventory can be in motion above us.
The question for air cargo is therefore bigger than how many parcels we can move.
Who benefits from the system? Who pays for it? Who governs it? And what should it be designed to achieve?
The market charter may have disappeared from the town square. But the principle behind it has not.
If trade is essential to prosperity, then the marketplace, whether physical or digital, is too important to be governed by efficiency alone.
About the author
Dr Sally Dixon MBA PhD MRAeS FCILT starting her career with Reuters, eventually following her passion into aviation.
Since 2000, she has worked with airports on acquisitions, forecasting, strategy and innovation projects, developing a particular interest in air cargo.
Sally holds a PhD from Cranfield University, where she continues to lecture in air transport management.
Today she combines academic discipline, industry credibility, policy awareness, curiosity, and the courage to ask questions that others haven't asked. These qualities she brings to boards, consultancy, research and teaching, and to helping audiences discover the networks that keep goods moving around the world.
