The concept of outsourcing as a formal business strategy emerged in 1989, building on the “focus on core competency” approach developed in the 1970s, which had already been driving outsourcing growth throughout the 1980s. However, airlines have long known the importance of agents to garner cargo sales.

That is why airlines employ General Sales Agents (GSAs) and General Sales & Service Agents (GSSAs) for cargo sales to optimise their operations, expand their market reach and ensure efficient cargo handling without maintaining a full in-house sales and service team. These agents act as intermediaries between the airline and freight forwarders, shippers and logistics companies, handling sales, customer service and operational support in regions where the airline may not have a direct presence. Their role is crucial in improving revenue, reducing costs, and ensuring seamless cargo movement.

GSAs and GSSAs allow airlines to establish a commercial presence in multiple markets without the expense of setting up offices, hiring staff or managing infrastructure. This is especially beneficial for airlines that serve multiple international destinations but do not have the resources to maintain dedicated sales teams in every country.

GSAs and GSSAs are typically well-established in their respective regions and have deep knowledge of local markets, regulations, and customer behaviours. Their existing relationships with freight forwarders and shippers enable them to sell cargo space more effectively than an airline’s centralised team.

By outsourcing cargo sales and services to GSAs and GSSAs, airlines can reduce overhead costs associated with maintaining in-house staff, training and office expenses. These agents work on a commission-based model, meaning airlines only incur costs when cargo sales are generated.

GSSAs, in particular, go beyond sales by providing operational support, handling cargo bookings, documentation, tracking, and customer service. This ensures a smooth cargo movement process and enhances customer satisfaction, allowing airlines to focus on core flight operations.

M&A gets going for GSAs and GSSAs

The GSA and GSSA sectors have experienced notable mergers and acquisitions (M&A) activity recently, reflecting a trend toward consolidation and expansion within the industry. ECS Group has been particularly active in expanding its global footprint through several key acquisitions. In early 2024, ECS Group acquired EFIS Maroc, a Moroccan GSSA specialising in air cargo services. In December 2023, ECS expanded into Latin America by acquiring Americas GSA, which operates in countries including Costa Rica, El Salvador and Panama. ECS further expanded its European presence by acquiring IAM in Ireland, securing a 30% share of the Irish GSSA market and diversifying its portfolio.

Kales Group has also pursued growth through acquisition. In October 2024, they acquired ACT Global, a Turkish GSSA, marking its expansion into this emerging market and strengthening its position in the region.

In 2024, JetBlue partnered with Americas GSA to enhance its domestic and international cargo operations. This collaboration leverages ECS Group’s technological expertise, aligning JetBlue with ECS’s innovative ‘Augmented GSSA’ service model for optimised cargo operations.

After acquiring a majority stake in Italy’s AlisCargo Airlines, MSC Air Cargo decided to internalise more of its sales operations, ending its partnership with ECS Group. This move reflects a broader trend of major logistics players bringing cargo operations in-house to gain better control over sales processes and reduce operational costs.

These developments underscore a dynamic period in the GSA and GSSA industries, characterised by strategic acquisitions aimed at enhancing market reach, operational efficiency, and service offerings in response to evolving global air cargo demands.

Limited reach, higher costs, inefficiencies

If airlines chose not to employ GSAs or GSSAs, they would face several operational and financial challenges. Airlines would struggle to reach smaller or emerging markets, as setting up their own sales offices in multiple locations would be costly and time-consuming. Maintaining an in-house sales force and operational team in multiple countries would lead to higher fixed costs, impacting profitability.

Airlines may not have the same level of local expertise and relationships that GSAs and GSSAs offer, resulting in lower cargo sales performance. Without GSSAs managing local operations, customer service, and booking support, shippers and freight forwarders might experience delays or inefficiencies.

In conclusion, GSAs and GSSAs play a vital role in airline cargo sales, offering cost-effective, scalable and efficient solutions that help airlines maximise revenue while ensuring smooth cargo operations.