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Consolidated international logistics profits customers during challenging economic cycle

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Consolidated international logistics profits customers during challenging economic cycleThe supply chain business is not immune to the economic challenges faced by other sectors, but, writes Arend du Preez, MD of Crossroads, South Africans are adaptable…

Du Preez says people at many organisations in this industry have a good understanding of land-side logistics. “There’s not a lot of room for service providers like us to improve their knowledge, even while we supply them the economies of scale they can’t necessarily achieve on their own,” he says.

“However, we routinely find that there is poorer understanding of the international leg. It’s not surprising. There’s a lot to learn and some less transparent operators abroad don’t make it any easier.”

One of the major issues, says Du Preez, are vested interests and how they impact full and proper disclosure of customer options.

“A specific service provider may offer potential choices to customers that influence time and cost, but the options are often limited to that service provider’s offering. There may well be other options that suit the client’s needs better, but the client never gets to hear of them because the service provider doesn’t offer that specific service.”

“That’s why African businesses benefit from turnkey services, such as ours. They’re no longer forced to buy the services of ten or more individual service providers all the way from road transport in somewhere like China, to clearing agents and shipping lines, while having to understand the ramifications of issues like demurrage.

“Instead, they get a straightforward business solution that gets them the goods they need – faster and for less – through a single point of contact, with all the transparency crucial to their own effective business administration.”

The actual transport, he says, is a fraction of the overall cost.

“Customers need visibility into the process, so they can provide visibility to their own customers. Effective communication is important, because it triggers planning ahead of actions which, if you get wrong, impact costs throughout the supply chain,” he says.

“The more sophisticated process and the solutions that support it feed two important business outcomes for customers – just-in-time supply chains and overall efficiency improvements that reduce costs.

“Service providers must collaborate with customers, who understand their own business extremely well, and often have people deeply experienced in the ramifications of supply chain decisions and the implications for their customers,” he says.

A chief aim of modern supply chains seeking to maximise the turnkey source-to-destination solution efficiencies, is removing the human element that makes them less efficient.

“There are many pockets of cost throughout the supply chain, but when you can influence the entire process, right from the point of origin to the final destination, then the experts can really dig into the benefits for customers and everyone profits,” he concludes.

 

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