INTERVIEW: Al-Futtaim Logistics
Logistics Middle East sat down with Al-Futtaim Logistics’ acting managing director and finance manager, Raman Kumar, and general manager for freight, Vargheese Anthony, to discuss their freight milestones in 2014, as this year’s expansion plans see the company branch into new trade lanes.
Tell me about Al-Futtaim Logistics.
Vargheese Anthony (VA): We are a market leader in providing end-to-end logistics, especially in automotive logistics, contract logistics, freight management, and corporate and general transportation. These verticals at Al-Futtaim Logistics are our strong pillars, which have placed us amongst the pioneers in the region’s logistics market. Our strategic position in 14 locations in the UAE has provided the right geographical coverage to meet our customers’ requirements. We are ready to grow further and faster, not only in the UAE, but in wider markets as well, with the help of our network partner IJS Global, we serve more than 80 countries across the globe.
Raman Kumar (RK): We are growing at a very fast rate, which presents challenges, but our wonderful team makes things happen. My skilled management team takes the business forward after I give them a strategy and direction. As an organisation, we are growing fast because we are delivering innovative and creative logistics solutions to every customer.
How does the UAE market perceive Al-Futtaim Logistics as a logistics provider?
VA: There is a gap in how the market perceives us today compared with our competence. Some people believe we are too strong in the local market, but not like other multinational corporations that are perceived as strong in delivering an end-to-end logistics solutions. The fact is, we are a global logistics provider with a strong foothold in the Middle East, catering to customers who are industry leaders, not only limited to local logistic operations but end-to-end integrated logistics. We provide advanced and integrated supply chain solutions to our customers, and most of them have worked happily together for many years, growing together.
We have developed a diverse client portfolio across the fashion, retail and heavy industries, as well as electronics, engineering and technology, automotive, aid and relief sectors. Whilst we proudly cater to large volumes for Al-Futtaim group companies, which gives us a strong presence in the UAE logistics market, we also provide customised value-added and 4PL solutions such as modifications of vehicles, retrograde movements, and warehouse and freight management.
Al-Futtaim Logistics operates charter movements to conflict zones and can mobilise 24/7 emergency operations within six hours of notification for emergency situations often faced by humanitarian organisations. Our specialist sectors include air charter operations, project cargo movements and relocations.
What would you say are Al-Futtaim Logistics’ key strengths?
VA: Our diversified multicultural team of about 1,000 associates leads the automotive logistics and corporate transportation sectors in the region. We also have a prominent market position in contract logistics and freight management. Our strategic positioning in prime locations such as Dubai Cargo Village, Dubai World Central (DWC), Sharjah Air Cargo Terminal and Jebel Ali Free Zone (JAFZA) has helped us to substantially grow international freight, especially in charter and general air freight. We have invested significantly to maintain a healthy infrastructure that serves our customers without compromise. Working with our strategic partner, IJS Global has enabled us to provide complete end-to-end logistics from all key origins and destinations.
RK: Al-Futtaim Logistics is recognised as a leading 3PL service provider in the UAE market and this is further confirmed by our existing clients who are satisfied with our services. As their partner of choice, we are always ready to help their business grow and in 2014, we successfully proved that we have the expertise to be innovative and creative in our solutions to wow our clients.
What were the freight milestones in 2014?
VA: Last year, we successfully achieved our target growth. In a very interesting year operationally, we shifted our freight operations to a larger state-of-the-art facility called LOG 1 at JAFZA South Zone to accommodate growth and also launched facilities at DWC. We managed approximately 4,000 tonnes of air charter operations throughout the year to and from DWC and Sharjah Air Cargo Terminal. We developed and delivered logistic platforms in some of the hubs connecting North Africa and the Middle East to enable a competitive edge, and we developed logistics platforms in other GCC countries to meet customers’ requirements.
In 2014, we introduced GoH (garment on hangers) warehouses to enable our customers in the fashion industry to ready serve their buyers at the showroom, and for our retail sector customers, we developed centralised home deliveries. We are pleased that a customer satisfaction survey conducted by an independent surveyor in the second half of 2014 showed that we continue to meet our customers’ expectations.
Can you elaborate on the customer satisfaction survey? How does the feedback help Al-Futtaim Logistics to evolve?
VA: Al-Futtaim Logistics conducts bi-annual surveys among clients who consistently use our services. This is conducted via an independent market research consultant. The feedback is shared with the executive management team and further survey actions are well structured and governed by the ISO Quality Integrated Management approach. This helps us to identify the root causes and corrective actions in collaboration with our customers. The process is fully supported by our leadership team, the success factor behind consistency in the customer satisfaction results, as we are able to address all areas that can continually improve the services for our clients and grow together as their preferred logistics partner.
How did it feel to win 3PL Service Provider of the Year at the Supply Chain & Transport Awards (SCATAs) again in April last year?
RK: The SCATAs are the only leading industry awards in the Middle East region. Al-Futtaim Logistics was a double winner at the 2014 awards, which is testimony to the high quality of service that we continue to deliver, and represents our contribution to the industry. We were honoured to receive this award, which increases market and customer confidence in us as a leading logistics player, both in the local and global networks.
How do you both see this year developing for Al-Futtaim Logistics?
VA: This year will be another interesting year for us, with some strategic changes in our growth directions. We strongly believe that our presence in the GCC and some African countries will enable our clients to perform better for their end customers. In a nutshell, we expect to fly the Al-Futtaim Logistics flag in additional countries within the year, and expect to double our business in the next couple of years.
RK: We are looking to expand regionally in Qatar, Oman, Saudi Arabia, and East and North Africa, and then into Egypt. We are hungry for expansion and business growth. In terms of our expansion in the UAE, we are looking to recruit 200 people across the board, from warehouse operatives to the management team over the next year.
VA: Another initiative is a trade lane development with our network partner; we have identified seven trade lanes for growth, where we already have a sizable presence today, to become influential service providers in these corridors. While a major focus is to support our key clients in their regional growth plans, we are gearing up to strengthen our presence in sectors that are fuelling the economy, such as food, pharmaceuticals and records management. In respect of this, we have already signed several contracts and we are exploring more opportunities as well as investing in new facilities, fleet and several other infrastructure developments to meet upcoming demands.
What industry trends do you foresee for 2015?
RK: We foresee positive trends in the next few years leading up to Expo 2020 in the UAE. As an organisation, we are expanding geographically from our home market and we are comfortable in our current positioning in terms of starting sizeable projects and our expansion in new markets.
VA: In the lead up to Expo 2020, we are ready to cater to the increased logistics requirements of our existing customers, as well as new clients. Expo 2020 will boost the economy and we are geared for that. There will be a construction related influx of business and we want to take the biggest slice of the pie.