This paper illustrates the use of simulation for evaluating and analyzing air cargo operations at one of the new stateof-the art cargo facilities at Toronto Pearson Airport. The establishment of a facility equipped with some of the latest in modern material handling systems available today and a computerized-based inventory control system that interfaces with all aspects of its cargo operations, has driven the airline company involved in this study to developing new processes to ensure that products and services are aligned with customers' needs. One of the challenges faced is a lack of an evaluation tool that can be used to quantitatively evaluate and compare different policies, business practices and processes within a given set of operational and business constraints. This work aims in developing such an evaluation tool. We describe the modeling approach, the challenges involved and the potential use of the simulation tool. Preliminary results are also reported.