Onwards and upwards

The features in this month's Logistics Middle East seem to offer conflicting news for the logistics and supply chain industry.
COMMENT, Supply Chain


The features in this month's edition of Logistics Middle East are pretty varied, and seem to offer conflicting news for the logistics and supply chain industry.

While our article on DHL Excel Supply Chain's recent deal with oil behemoth Saudi Aramco shows the benefits that can be accrued by providing flexible solutions, our survey results on retaining talented employees, plus a review on the rising costs of fuel, are not so positive.

As a relatively recent entry to the Middle East, the industry is to a large extent still finding its feet amid the booming profits experienced in 2007 and which are predicted for 2008.

However, it would be remiss of industry observers not to point out the potential pitfalls that may lie ahead, in order to help supply chain professionals improve their profit margins still further.

In what is an uncertain period for a nascent sector, we aim to offer pragmatic solutions; for example, our assessment on the skills shortages now facing logistics providers, alongside other industries, offers a number of tips that should help operators find, retain and enthuse talent.

Similarly, our article on the rising fuel prices outlines the smart management that some of the logistics players are using to ameliorate the extra expense being incurred.

Having said that, a lot of the factors that are creating headaches for industry firms are external, and, to a certain extent, there is little that regional operators can do to offset challenging economic conditions.

While the industry itself is unlikely to suffer any let up in growth, the smaller regional operators may think it wise to consider their positions and look at streamlining their operations in the short term.

With the recent acquisition of Swift Freight by Barloworld, the region will also be looking at the prospect of consolidation, which would reduce the number of industry players in the GCC countries.

This possibility seems not to be one that is considered wholly palatable, judging by the mixed reaction to the news of the Swift takeover.

On the other side of the coin, however, it is encouraging to read of the many success stories that are currently being written by logistics providers in the Middle East.

Our cover story describes the multitude of solutions that toyseller Toys "R" Us is utilising in order to increase its share in the regional toy market, and the synergies found by DHL Excel Supply Chain have resulted in a ten-year contract worth an estimated US$500 million with Saudi Aramco, a deal that shows that no barrier is too high when it comes to making partnerships with even the world's biggest companies.

In addition, our regional news section outlines the potential rewards that exist in the Middle East's postal industry.

So while there are some concerns hovering over the logistics industry, as there are for many other sectors in the GCC and beyond, there are a number of positives that should be taken on board as well, not least the fact that the Middle East stands to weather the storms of an economic slowdown better than most other regions.

The encouraging aspects of the sector will be celebrated at the second Supply Chain And Transport Awards (SCATA), which will be held at the prestigious Al Marooj Rotana Hotel in Dubai on 28th May.

We have a preview of the awards in this edition, and a full report on the results will be submitted in next month's issue.

Any thoughts you have on the current state of play in the supply chain industry, or on this edition of Middle East Logistics, would be highly appreciated. Please send any comments to

Robeel Haq is the group editor of ITP Business' transport magazines.

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