Not All Bids Are Created Equal

Feb. 14, 2018
There are numerous ways for ground handlers to make their bids stand out among others in order to win new business.

Securing bids for ground handling operations is a competitive venture. With numerous factors shaping what a station is looking for in a ground handler, it is vital for a company’s bid to stand out among others in order to win new business.

“As an applicant or a bidder, don’t just send a generic bid in,” says Stuart Matheson, Director at ASG, while discussing the topic of winning bids at the IATA Ground Handling Conference in Bangkok, Thailand. “The RFP (request for proposal) is designed for a specific set of circumstances and market conditions. Customers want to know you can fit their needs. It’s what they want. It’s what they expect of you.

“If you make an application, actually read the RFP.”

An obvious detail in any bid is price. While submitting a bid with a competitive rate is essential, being a trustworthy, respected organization is more crucial.

Therefore, Matheson says safety must be the No. 1 priority.

Maintaining levels of service and providing longevity are more important than slashing prices, he explains. If low prices are unsustainable, it ultimately costs more money long-term for all parties involved.

“It’s not good for the ground handling industry. It’s certainly not good for the airline customers, and it’s not good for the reputation of the airport,” Matheson says.

New Opportunities

Having a grasp on emerging market trends and new technology can be great way to secure new bids. Paying attention to company mergers, carrier tendencies, opportunities in new geographical locations and improvements to ground support equipment can allow companies to shape their bids in an attractive manner.

Among these key opportunities, Matheson points to automation, which can improve safety for ground handling agents and provide reassurance to airlines.

“People are the most expensive commodity. It’s important, from a ground handling perspective, to learn about how we can automate as much as possible,” he says.

“Eighty-four percent of all aircraft damage happens to an aircraft when it’s in custody of a ground handler, across the world. Therefore, anything we can do to improve that is a must,” Matheson continues. “We have to look at better design, better automation.”

There are also opportunities with legacy carriers. Some airlines that had previously self-handled are now outsourcing that work to third-party ground handlers, creating more work for interested bidders.

What’s more, an increase in passengers with reduced mobility (PRMs) presents openings for ground handlers to expand their business.

“In Europe, they’ve seen a 27 percent year-on-year increase in passengers with restricted mobility. That’s a good thing because what that’s saying is – most airports claim a 6 to 8 percent annual growth. That means half of that growth is going to come from PRM passengers – whether they be elderly, disabled or whatever else,” Matheson explains.

“It’s something, as ground handlers and airports, we need to think about,” he adds. “Certainly, the ground handlers are looking at that as a means of … more ancillary revenue; but by the same token, also looking at ways they can improve the accessibility.”

With this in mind, a ground handler that is able to demonstrate its investment into ground service equipment, like ramps and ambulifts, can set themselves apart from others.

RFP Management

Matheson stresses the importance of fully understanding an RFP because once a license is granted, a ground handler must deliver what is promised.

Likewise, from an airline’s perspective, it is imperative to partner with a reliable ground handler because passengers expect the airline to deliver a positive experience – whether working with a third-party or not.

“Increasingly, what we are doing is, from an RFP perspective, we’re making the RFP a vehicle for the contract – certainly, from an airport perspective,” Matheson says. “It now becomes ‘this is what you signed up for.’

“We design RFPs that are in line with the IATA Ground Handling Agreement (IGHA). Or in the case of more regulated markets, they reflect local regulation.”

Anticipate Changes

Matheson points out that aviation handling is changing rapidly. As the market moves quickly, ground handlers, airlines and airports must act quickly as well to avoid falling behind their competition.

He encourages all involved parties to be “future proof.”

“Be aware of what’s going on, what the market trends are. Be aware of some of the IT changes,” Matheson says. “Know what you want – not just for now, but in the future.”

It is also critical for ground handlers to do their due diligence before making a bid, fully understanding what capital will be needed to acquire the equipment necessary to fulfill an obligation.

Airlines are pushing ground handlers for a lower price. But it is important to avoid offering a low price and then not be able to deliver on what is promised.

About the Author

Josh Smith | Editor