Freight &Trading Weekly Special Feature Logistics

JULY 2009 FREIGHT & TRADING WEEKLY

SPECIAL feature

Logistics As strong as the weakest link

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JULY 2009 | 1

Editor Joy Orlek Consulting Editor Alan Peat Contributors Liesl Venter Advertising Carmel Levinrad (Manager) Yolande Langenhoven Claire Storey Jodi Haigh Managing Editor David Marsh

Correspondents

Durban Terry Hutson Tel: (031) 466 1683 Cape Town Ray Smuts Tel: (021) 434 1636

Carrie Curzon

Tel: (021) 674 6935 Port Elizabeth Ed Richardson Tel: (041) 582 3750 Swaziland James Hall jhall@realnet.co.sz

Advertising

Co-ordinators Layout & design Circulation Printed by

Page 2 Customer focus at the heart of successful supply chains

This is as true for the economic battlefield as it is for physical battle grounds. In the words of Lt. Gen. Fredrick Franks, USA, 7th Corps Commander, Desert Storm: “Forget logistics, you lose.”

In this feature we celebrate some of the logistics victories and examine challenges facing business in South Africa today.

Page 10 Logistics holds key to African growth – report

Tracie Barnett, Paula Snell Dirk Voorneveld subs@nowmedia.co.za JUKA Printing (Pty) Ltd

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“The line between disorder and order lies in logistics …”

– Sun Tzu. Nothing much has changed, except perhaps that the current world economic meltdown is forcing management and companies to focus again on their logistics chains in order to stay in the game and position themselves for the recovery – whenever and wherever that happens.

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Page 21 Independent companies pool resources to improve customer service

Page 4 Expansion into Africa is top of the agenda

Page 12 New device improves container security

Phone + 27 11 327 4062 Fax + 27 11 327 4094 E-mail carmell@nowmedia.co.za Web www.cargoinfo.co.za

Page 22 Eastern Cape freight likely to stay on road Page 25 Vehicle industry looks to logistics to contain costs

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Page 5 ‘Effective systems the difference between survival and failure’

Cover concept: Joy Orlek and Dirk Voorneveld

Page 6 Supply chains competing with supply chains

Page 14 Project specialist put through its paces

Page 8 Ongoing road congestion shows no sign of easing

Page 18 Logistics company achieves top empowerment ranking

Page 16 Confederations Cup kicks off soccer logistics success

Page 27 Sophisticated seals provide real-time cargo tracking

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2 | JULY 2009

Customer focus

at the heart of successful supply chains

By Alan Peat

I

n the search for the answer to the common question: “What makes for world-class supply chain operations?

FTW quizzed Martin Bailey, director of Industrial Logistics Systems (ILS) and former academic logistics specialist, for the solutions.

“Every week,” he said, “we read a great deal of stuff that is written on what hundreds of so called ‘experts’ believe are the best things you can do in your supply chain to become world class.

“Third party operators will tell you that all you have to do is outsource, and they will take you to the ‘Promised Land’. Consultants will waffle

‘To have a successful supply chain you need motivated, intelligent, educated and competent people operating the processes.’ eloquently about value chains and strategies that will earn them lots of money (example: balanced scorecards).

Equipment suppliers will absolutely convince you that buying their kit will allow you to infinitely increase productivity, and the local IT salesman is sure that if you use his software you will halve your costs and double your throughput.”

But finding the truth is a complicated issue.

“Unfortunately,” said Bailey, “there isn’t a simple, all-embracing answer to creating a world-class facility – and there are many ‘false prophets’ trying to force you to go down a path that will not achieve the desired results.”

But Bailey supplied a few guidelines that may help in trying to create a supply chain that truly has potential to be world-class.

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“Most really successful supply chains are customer-focused,” he said. “This requires a radical change in business philosophy – and the vast majority of organisations have extreme difficulty in changing their entire culture to refocus on customer needs, rather than their own internal needs.”

As an example, Bailey suggests that customer focus means that customer needs are more important than supply chain costs.

“It means that you need to really understand what the customer wants, likes and dislikes,” he added, “and you then need to restructure your supply chain around his needs – not around what you perceive is best for him.”

Next on his list of guidelines is “quality”.

“Really successful organisations have a core quality focus,” he said.

“Everything they do is around maintaining high levels of quality. A total quality philosophy permeates the entire company.”

And this quality philosophy must also include the supply chain.

“It is no use making the best product in the world,” Bailey said, “and then giving it to a third-rate distribution infrastructure. When companies do embrace total quality concepts (including supply chain philosophies), they are on the road to success.”

Costs are another area that is under the spotlight.

“While service and quality must take precedence,” said Bailey, “any worldclass supply chain must focus on cost.

“Depending on the available margins, supply chain cost may have a large influence on the success of an organisation.”

And to reduce costs, Bailey added, organisations usually rationalise, consolidate (example: centralise) and re-engineer processes. In some cases, outsourcing or in-sourcing may provide short-, medium- and long-term

Martin Bailey ... ‘There isn’t a simple, all-embracing answer to creating a world-class facility.’ financial benefits.

Infrastructure and resource will also play a role in seeking a solution.

Bailey feels that, to achieve a world-class supply chain, you need the facilities, resources and infrastructures that will allow you meet customer needs.

“This,” he said, “means you need appropriate warehousing, transport and management facilities. If you don’t have the physical resources to receive, store, order pick, dispatch and transport you cannot react to market needs and thus cannot possibly have a world-class supply chain.”

Information technology (IT) also fits under this same heading. According to Bailey, if you don’t have appropriate IT resources, you cannot achieve operational efficiency to make your supply chain world-class.

At the core of any operation are

its people.

In Bailey’s mind, to have a successful supply chain, you need motivated, intelligent, educated and competent people operating the processes. You also need systems to manage the people and processes that run the core business without people interference.

“Finding and managing good people is perhaps the most difficult task within any organisation,” he said.

Bailey concluded that a world-class supply chain was, therefore, a balance between lots of components.

“They range from a customer focus through intelligent business philosophies, along with enablers such as good infrastructures, people and information systems. Organisations that truly achieve world-class status are those that achieve excellence across all these areas.”

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4 | JULY 2009

Expansion in Africa is top of UPS agenda Infrastructure shortfalls pose major challenge

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Paul Horsfall ... ‘Working closely with government departments and border patrols.’

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xpansion in Africa is currently a main aim for global supply chain specialist UPS, with plans to spread its network of operations, agents and authorised service contractors throughout the continent.

It already has a solid footprint in Africa – including Namibia in the southwest, Reunion in the south-east, Morocco in the north-west and Djibouti and Egypt in the north-east.

“Our interest in Africa is very similar to our customers elsewhere in the world,” said Paul Horsfall, MD of UPS-SCS in South Africa.

“Even though there are serious challenges related to poor transport infrastructure in various countries, we are dedicated to overcoming these difficulties by working closely with government departments and border patrols.”

Among the drawbacks that need to be overcome are various political, geographical and governmental restrictions tending to limit the coverage areas.

An example, according to Horsfall, is Angola.

“It is a fast growing market and the possibilities to expand are exponential,” he told FTW. “But, although the Angolan government is doing its utmost to upgrade the roads, the congestion of the shipping ports in the country limits UPS’s ability to increase the level of service already in existence. It is crucial that we train and support our partners in these countries to overcome the challenges and uphold the quality and standard that UPS has worked so hard to build.”

International aid to developing African nations is another area of focus for UPS, rated the world’s largest package delivery company.

“The international aid agencies, with their time-sensitive materials, find us a reliable partner which understands their needs and has a strategic network across Africa to support their programmes,” said Horsfall – highlighting as an example a recent US$50-billion deal with a well established pharmaceutical company to deliver much needed antiretroviral drugs (ARV) to various African countries.

Transporting these ARVs is not as simple as one might believe, according to Horsfall, as the cargo must be kept below

a temperature of 35 degrees Celsius.

“Africa’s extreme temperatures create a constant challenge to control the temperature inside a metal container,” he said. “Unexpected delays at the border post, and offloading and security issues at shipping ports also have a major effect on the turnover times and service delivery.”

Hijacking and theft of medical supplies also constitute a major problem.

To combat this, a UPS answer is that stringent security measures must be implemented when delivering these sensitive materials – and the company needs to work in close partnership with its agents in all African countries to ensure that sensitive cargoes, such as ARVs, are delivered to those departments responsible for distributing them to the public.

“However, it doesn’t matter what the size, shape or value of the package we are commissioned to deliver,” said Horsfall.

“We will take every step necessary to ensure that it reaches its destination.

“We are correctly equipped to ensure the safety and timeous delivery of each package entrusted to us.”

JULY 2009 | 5

‘Effective systems the difference between survival and failure’

By Alan Peat

A

good computer system is no longer something on which a clearing and forwarding business has built up a dependency – it is the business nowadays, according to Werner Pretorius, the logistics system specialist at freight system operators, Compu-Clearing.

“If you want to be successful in anything, be it warehousing, customs clearing or road transporting,” he said, “you need to have a fantastic system to back you up.

“This is especially so in this current economic crisis, where time is money and you can’t afford the slightest mistake. It’s the difference between survival and failure.”

A latest example of the CompuClearing system activities, Pretorius added, is a job they are currently conducting for the Swedish-based electronics specialists, Ericssons, developing an automatic ordering system for the company.

“For those guys,” he said, “this is a serious contract. They’ve got anything between a couple of hours and the next day to produce the spare part needed for a client.”

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And that is a complicated process, with thousands of transactions a day having to travel through the system all the way from order placement to part delivery and installation – and every spare part needing to be instantly available within the time available.

“You’d never be able to handle all these transaction records with a manual system,” Pretorius added.

A computer system is no longer purely a glorified, electronic calculator – it’s part of your very business management policy.

According to Pretorius, people are utterly reliant on a fast, accurate system – and it’s actually doing the thinking for them, telling them what they need to do next.

“It all boils down to customer service,” he told FTW. “Keeping the customer happy nowadays, you need to ne able to up your service offerings by two-to-three levels just to compete, and meet the demand.

“There’s just no time any more. The freight business is so time-instant. It’s just crazy fast.

“Systems have to be equally instantaneous and utterly accurate. The very future of your business depends on it.”

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6 | JULY 2009

Supply chains

competing with supply chains TPT encourages private sector involvement

By Joy Orlek

S

upply chains are competing with supply chains in the global logistics game – a concept of which Transnet Port Terminals is patently aware.

“In today’s globalised village we know that it’s supply chains that compete, so if we adopt a supply chain view and encourage collaboration amongst players within the chain, it enables South Africa’s supply chain to become globally competitive,” says Mervin Chetty, recently appointed GM for the Natal corridor.

But every link in the supply chain has a role to play, says Chetty.

“Interfaces between supply chain players are critical – it’s not only about

investing in ports and rail but also enabling other parties, like those in the private sector, to equally invest in skills development, capacity creation and productivity and efficiency improvements.”

TPT’s five-year plan involves an investment of R11.2-billion.

A significant amount of that investment is geared towards cranes and equipment, and is clearly positioned for the container and bulk terminals. “While several companies are pulling back on investments due to the global recession, we’re taking a country perspective which means creating capacity ahead of demand,” says Chetty.

“We may have to delay some investments, but we certainly won’t be

cancelling them.”

And these investments will improve global competitiveness in several ways, in his view.

“First off they’ll reduce the cost of doing business in South Africa by reducing transport costs.”

By way of example, a vessel that currently takes two or three days to turn around could be turned around in two days with improvements to productivity and efficiency, says Chetty. “That means a one-day saving for the shipping line, creating competitive advantage.

“There’s a huge opportunity for us as South Africans, and more especially South Africa Inc – and while we don’t have the major trade flows, we’re certainly well

Mervin Chetty ... ‘Well positioned at the epicentre of the continent to promote the hub and spokes concept.’ positioned at the epicentre of the continent to promote the hub and spokes concept and attract a lot more trade to South Africa.”

Creating capacity ahead of demand When it comes to global competitiveness, reducing the cost of logistics is a central theme.

And Transnet Port Terminals is clearly on side – in its intentions if not always in practice.

“TPT’s objective in the next five years is mainly around making sure that the country’s port system is really

globally competitive,” says Mervin Chetty, GM of the Natal corridor.

And achieving that goal demands focus on several areas.

“We need to create capacity ahead of demand, to improve productivity and to up-skill our workforce.”

And while South Africa may not be the main east/west trade route, within

the region or within the continent it handles probably more than 80% of the volumes in Africa from a container and bulk point of view.

“So it makes sense for us as a country to adopt a position of having a hub within sub-Saharan Africa.

This will in turn facilitate a hub and spokes system within East and West

Africa so that all traffic emanating from South Africa can be shortshipped into the different areas within this region, said Chetty.

“It also positions South Africa from a NEPAD point of view to help landlocked countries to reduce transport costs which is high on the agenda.”

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8 | JULY 2009

Ongoing road congestion shows no sign of easing

Approximately 90% of all containers arriving at Durban do so by road transport.

By Terry Hutson

O

ne of the most taxing problems facing Transnet during the ‘busy’ years of the mid to late 2000s was that of congestion at the container terminals, with Durban in particular handling record volumes and facing the prospect of ‘house full’ signs that forced shipping lines to wait outside

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for days at a time or even to bypass the port altogether.

This led to a number of schemes being considered, each aimed at increasing container capacity – schemes that are still part of the mix, but due to the unexpected economic downturn, are now not so urgently required.

Nevertheless, if there is one area that continues to be of concern to the eThekwini Municipality (Durban), to its motorists and to port users generally, and in particular to the road freight industry, it is ongoing road congestion – one of the major culprits in raising the cost of logistics in this country.

Increased volumes arriving at the port are not the only reason for this problem. The loss of traffic from rail to road, which has been ongoing for some years, has now reached the point where approximately 90% of all containers arriving at Durban do so by road transport – 15 years ago rail’s share was between 35 and 40% and rail could be seen as still holding its own.

Since then the transition to road transport has escalated and in addition Transnet Freight Rail’s inability, or unwillingness, to deliver dry bulk commodities – coal, ores of various

The human face of logistics

By Ed Richardson

descriptions, grains – has seen vastly increased numbers of tipper trucks arriving at both Durban and Richards Bay from as far afield as across the borders, Limpopo province and the Northern Cape.

Added to this are considerable numbers of tanker lorries arriving simultaneously in the Bayhead region, with resultant massive road congestion becoming a serious problem and challenge.

Transnet has tried to alleviate the problem among container deliveries by opening a truck stop facility outside DCT but has held off from making a decision to create a similar facility next to the Pier 1 Container Terminal.

It has also held back on widening the remainder of Bayhead Road leading to the Pier 1 terminal.

But the challenge remains latent and while the really bad logjams have largely disappeared with the decrease in container volumes, the number of long-distance tipper lorries arriving has continued – a single company advised recently that of its fleet of 480 tippers most would be delivering to destinations in the ports of Durban and Richards Bay.

Port and city authorities are working together to ensure that surrounding communities benefit from the business generated by the freight flowing through the harbours.

Walvis Bay has been identified as the first pilot for the Safe Communities Project in Namibia.

The country is the third in Africa to adopt the initiative, which promotes social stability amongst community members in order to reduce crime and other social ills.

With the increased volumes moving through the Port of Walvis Bay along the Walvis Bay Corridors, “it has become imperative to ensure that the business and social environment in Walvis Bay provides the necessary safe environment for community members,” says Hippy Tjivikua, project manager for the Safe Trade Transport Corridors of the Walvis Bay Corridor Group.

The community-driven Safe Communities concept has been developed by the World Health Organisation (WHO).

JULY 2009 | 9

US sees logistics costs dropping … thanks to financial crisis

By Martin Rushmere

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Warehousing costs

 9.5% Inventory-carrying costs

 13% Transport costs

 2% Transport costs were only up 2% over 2007. Trucking, which accounts for 78% of transportation, increased 1.3% compared to 4.4% for rail, air, and ocean modes. Truckload industry capacity dropped at unprecedented rates, with freight volumes declining faster than capacity, offering little incentive to keep fleets.

Cape Town Robert Child Marine Manager Phone: +27 21 417 4404 E-mail robert_child@aon.co.za

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os Angeles: A woeful economy and the popped bubble of consumer spending have combined to take much of the steam out of higher logistics costs in the US. Total logistics costs dropped to $1.3 trillion last year, a decrease of $49 billion from 2007, while interest rates plunged 50% as the Federal Reserve tried to heat up the economy, according to the Council of Supply Chain Management Professionals. After rising by over 50% during the previous five years, business logistics costs dropped to 9.4% of Gross Domestic Product in 2008.

However, warehousing costs rose by 9.5% as unsold stock spent more time in warehouses.

In 2008, inventory-carrying costs dropped 13%, and were the driving force behind the year's decline in logistics costs. The decrease in carrying costs was due to both a 2% drop in inventories and an 11% decrease in the inventorycarrying rate.

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10 | JULY 2009

Logistics

holds key to African growth – report

By Ed Richardson

R

egional integration is essential for sustained development on the continent, especially within the context of the current world economic crisis, according to the Unctad report Economic Development in Africa 2009.

Better links between countries, ranging from paved roads to banking cooperation, are needed to spur mutual economic growth,

says the report. Weak physical and institutional infrastructure is the key obstacle to increasing intra-African trade and investment.

This is why Africa has the world's lowest shares of regional trade and investment, according to the report.

Official statistics put Africa’s share of external trade at 9% of the global total, and inward foreign direct investment (FDI) at 13%, it adds.

Subtitled “Strengthening Regional Economic Integration for Africa’s

Development”, the 2009 edition of the Unctad annual report on Africa says the establishment of subregional economic communities has not substantially increased intra-African trade, investment and mobility of people as expected.

To boost regional integration, countries need to strengthen their regional physical infrastructure such as roads, railways, telecommunications and regional airlines. Given the limited resources

of individual African countries, there would have to be joint funding by neighbouring countries.

Physical infrastructure will need to be complemented by improvements in soft infrastructure, including policy harmonisation at the regional level, trade facilitation, efficiency in border procedures and the adoption of national policies that help rather than hamper the process of integration, the report says.

World Cup logistics – now is the time to make money

By Ed Richardson Logistics companies will be making their money out of moving materials and equipment for the new stadiums in South Africa, broadcasters setting up studios, new hotels, and bringing in the many thousands of litres of Budweiser beer that thirsty fans will consume.

Judging by the experiences of Germany (Fifa Soccer World Cup 2006), Korea (Seoul Olympics 2008), in Germany overall hotel occupancy dropped due to “crowding out” and displacement of normal tourism, according to Wolfgang Maenning of

the University of Hamburg.

Retail sales in Germany were also down, as locals stayed away from the shops or watched the games at home, he told a Fifa World Cup in South Africa 2010: Economic Scope and Limits conference in Cape Town recently.

The experience in Seoul was similar, with retailers reporting a 50% drop in sales ahead of the Olympic Games. According to the New York Times, hotels were also forced to cut prices as spectators stayed away from the long-haul destination.

Analysis of the effects of the

French (1998) and US Soccer (1994) World Cups show similar patterns.

While beds in the host cities were mostly sold out, hotels, restaurants and tourism destinations outside of the games mostly lost out – leading to an overall drop in tourism numbers during the events.

First to go is incentive and group tourism – who wants to travel to a country where prices are expected to be inflated, transport crowded and restaurants and sites expected to be full of fans?

The truth is that the 2010 Fifa World Cup is probably the best time to find tourism bargains outside of

the main centres – if not now, then closer to the time if South Africa follows the same pattern as other countries which have hosted either the Soccer World Cup or Olympics.

For logistics companies, the challenges will be working around the expected traffic jams, no-go zones that will be closed before, during and after games, and even covering up their own signage – none but official sponsor logos may be displayed in a one kilometre radius around stadiums and on the official routes.

Seems there will be time to watch the games, after all.

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Nyati Cross Border are not letting the fact that they are the new kid on the block stop them.

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Mozambique

Sandra de Kock

Understanding the unique intricacies of moving cargo in African countries is what makes Whitelion successful.

“Having reliable contacts and relationships with people in the countries you are working in is very important,” says Director Sandra de Kock. “We specialise in Mozambique and have

Zambia

Richard Hall

From couches to copper there is very little that Ka Go 2 Go doesn’t transport. Specialising in consolidations into Zambia, the company is based in Johannesburg but also has a warehouse and offices in Chingola, the ideal location to offer a personalised service to both Zambian and South African clients.

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As the global economic downturn continues to impact on South African transporters service is becoming integral in securing business.

“Because of the substantial

Angola.

Established just six months ago, the company is intent on proving its capability in taking on the difficult Angolan market.

“The global economic downturn did not make for an easy first six months in operation,” says owner Friedel Kirstein. “It has, however, been a big achievement having survived in these tough economic times.”

Providing cross-border transport services to all the SADC countries the decision

to service Angola is aimed at extending its reach to existing clients and attracting new business.

“We believe there is a lot of potential and opportunity in Angola and want to make our mark. It is not an easy entry point and we know there is a lot of red tape from the get-go, but we know that we are able to service this country very well as we have the capability,” says Kirstein. “It is about opening a new door and broadening what we do.”

And with much development happening in Angola there is no doubting the need for transporters.

“Developing a new market is not necessarily easy, but in these economic times it is about creating opportunities and making business work despite the obstacles.”

made sure that we know and understand the important issues in the country, that we are able to overcome hurdles and meet clients needs regardless of any obstacles.”

Initially established to move large amounts of timber, Whitelion has expanded and now moves a variety of cargo – be it to the Port of Maputo or the Durban harbour.

“During the winter months we are very busy as it is citrus season and much of the fruit is moved out through the Maputo Port,”

says De Kock.

With about 40 vehicles servicing the Mozambican route, the company also has an office in Nelspruit. This allows it more hands-on involvement with farmers and also gives it a central location on the route.

“We have really invested in ensuring we understand Mozambique. It is not an easy route as it is very cash-flowintensive. The tolls on the route are expensive.”

Add to that the major border delays experienced, along with

the language barrier, and being good at transporting on the Mozambican route is no easy feat.

But Whitelion has in the past year proved its worth and is considered an expert on the country.

“We make sure that when we transport especially to the north we use drivers who are wellversed in Portuguese and that they know procedures and are capable of dealing with issues,” says De Kock.

According to owner Richard Hall, the company has seen major growth in the past year – expanding from a fleet of three to 15 vehicles.

“We pride ourselves on offering a very personalised service – we know our clients and their needs well.”

Also specialising in express and emergency services to Zambia, the focus at Ka Go 2 Go is on service. “We are able to move goods from Johannesburg to the copper belt in two days.

We are finding in these economic

times that companies are keeping less stock and that has led to a big demand for express services as goods are ordered as and when they are needed.”

And with this comes a need for consistency and reliability – attributes that are important to Hall. “Transporters often shy away from consolidations or repairs and returns because there are always a lot of problems involved. We don’t shy away, we do the consolidations, we do the repair and returns, and we do them well.”

Having built up infrastructure in Zambia, the company is able to meet clients’ needs. “We also have good relationships with our clearing agents and have made invaluable contacts – all things that are necessary when working in Zambia. It is a much easier country to service than for example Angola or the Congo, as there are no language barriers.”

drop in rates, clients are now shopping around for transporters who can offer a superior service.” says Gary Hall, co-owner with Mike Koch of Cargo 2 Congo. “It’s all about service delivery.”

Initially focusing on project cargo to the Congo, the company saw a dramatic slow-down in business as a result of the downturn.

“Quality service as well as a hands on approach has been our saving grace. Here you don’t deal with six or seven people –

you get to our top management immediately and we’re available 24/7.”

And taking their outstanding track record into account this is not just another transporter.

“We give every client personal attention.”

Working in the Congo is not easy, Hall admits. “There are government levies charged on most everything. Transport laws and restrictions are constantly changing – if you’re not 100% up to the minute you will fall behind. Having said that though

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the rewards are also great and there are many opportunities for transporters.”

And while it may still be a tough environment out there, it is getting better. “In recent months we have seen an increase in demand for consolidation work into the Congo. These consols will hopefully translate into project work once the economic cycle swings,” says Hall.

Tel: +27 11 974 0575 Cell: +27 82 448 2367 gary@greendoorlogistics.co.za

12 | JULY 2009

New device improves container security Partnering helps clients through global crisis

BY Michelle Hardy

S

ecurity of ocean-going containers has been improved with the introduction of a new device developed by Cape-Town based EDGIN Logistics Solutions.

“Recognising the need for additional security, we have just developed and successfully used a custom-made device that records when an ocean container door has been opened and closed,” says Dave Johnson of EDGIN. Working in a similar manner to a Ryan recorder (which records the temperature inside a reefer container for later analysis), this device records the date and time each time a container door is opened and closed.

The company continues to invest through the downturn. It recently opened a facility in Port Elizabeth, offering its timber clients packing services closer to the forests of the Eastern Cape, in addition to general warehousing with container storage, packing and unpacking facilities.

EDGIN has also added 6 600m 2 of covered space in Cape Town. “This space may come in handy for large prospective clients, such as the proposed mining projects on the West Coast,” says Johnson.

The company is partnering with clients to help them through the global crisis, says Johnson: “We have found that the present downturn has put tremendous strain on our existing client base, particularly those involved in the export

Abnormal handling is part of the mix. of raw materials.

“Many of those clients have been with us since our company was founded and we really view them as our business

partners.” EDGIN’s discussions with its clients has allowed it to offer extended credit terms, reduced rates and lower costs by streamlining operations, he said.

logistics services and has found that this can also be cost-effective, according to Johnson.

He practises what he preaches and outsources where necessary. “One of the most important aspects of logistics is honesty, and if you’re honest you’ll

admit that some of your peers can do a better job than you with some products, or that they have a facility more suited to a particular commodity or storage requirement.” EDGIN outsources warehousing to three other concerns in Cape Town alone.

3 PL comes of age Companies are starting to realise the advantages of third party logistics as a result of the downturn, according to Dave Johnson of EDGIN. Manufacturers using internal logistics functions now have idle warehouses and low stock, and third-party logistics

providers can save a lot of money by preventing this.

“By using a 3PL you are spreading the risk of wasted space, not to mention the idle personnel and capital equipment,” he says.

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JULY 2009 | 13

Revival of protectionism threatens trade routes

By Ed Richardson

T

he free global flow of goods is being threatened by the resurgence of protectionism warns Willemien Denner, a researcher at the Trade Law Centre for Southern Africa (Tralac).

Since the start of the financial crisis the World Bank has estimated that 78 trade measures have been imposed or implemented.

These trade measures include 66 trade restrictions of which 47 took effect. Several countries have raised border barriers, introduced subsidies or stimulus packages for export-orientated or import competing industries, and increased the use of trade remedies.

“A pattern is beginning to emerge of an increase in import licensing, import tariffs and trade remedy utilisation to support domestic industries,” says Denner.

“The World Trade Organisation (WTO) and the World Bank have

indicated that the contribution of protectionist policies to the decline in trade has been limited to date, however looking forward there is a risk of a retreat from trade liberalisation and open border policies which has been followed in the past decade,” she says.

Denner sees signs that South Africa may be one of the first African countries to raise trade barriers. As the financial crisis puts increased pressure on African economies the question remains whether governments will resist political pressure to utilise the implementation of protectionist measures to protect domestic industry and employment.

“South Africa has already indicated that they are considering raising import tariffs on garments to maximum levels agreed to by South Africa in the WTO. Is this an indication of policy measures to come by African countries as economic activity decreases due to the global recession?” she asks.

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14 | JULY 2009

Project specialist put throu From stampmills to 255t transformers

By Alan Peat

A

mong the more run of the mill abnormal cargo moves, abnormal transport specialist, Vanguard Rigging, has recently completed the transportation and placement of two antique items of gold-mining machinery.

According to MD Bryan Hodgkinson, the stampmills are sited at the Kloofendal Nature Reserve on the West Rand of Johannesburg, and one of them is the

legendary 124-year-old Sandy Croft stampmill that gold mining pioneers Fred and Harry Struben shipped to SA from England in the 1880s. The reserve also plays host to the Confidence Reef, the first goldmine on the Witwatersrand, discovered by the Struben brothers.

“This was a great community project for us to get involved with,” said Kevin Joubert, project manager, Vanguard.

“The Friends of Kloofendal have been planning this for some time, and by

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Below: Antique stampmills – the first of their kind in the country – were relocated to Kloofendal

ugh its paces coincidence we discovered that we could easily accomplish what they needed.”

The mills, weighing approximately eight tons each, were moved from Florida, Roodepoort where the Sandy Croft mill had been standing for the past ten years – using a crane truck to lift and place them on a flatbed truck for transportation.

In what might be described as a more mundane abnormal move – certainly from an historical point of view –

Left: On the move ... Vanguard has been involved in the delivery and placement of a series of transformers and rectifiers to various sub-stations nationwide.

Vanguard has also just completed a massive, 18-month programme of transformer movements around the country.

This, according to Hodgkinson, was the delivery and placement of a series of transformers and rectifiers to various sub-stations nationwide – with each 667-MVA transformer weighing in at 255-tonnes, and 10-metres long by 4.9-m wide by 5.25-m high, and each shunt reactor tipping the scales at 82-t a unit.

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16 | JULY 2009

Confederations Cup

kicks off SDV’s soccer logistics success ‘It’s all about delivering on promises’

By Liesl Venter

T

here is no stopping SDV Durban – from mine equipment to food aid – this is a company on a mission.

Having been responsible for the supply and delivery of all the gazebos, marquees and toilets for all the stadia in which the recent Confederations Cup was held, they are proving their mettle.

According to Ken McDonald, branch manager for SDV Durban, the Confederations Cup was just one opportunity to show what the company’s capabilities are.

“We were very proud to be a part of the Confederations Cup and to have contributed to its success. We are equally excited at the opportunity of contributing to the 2010 World Cup Soccer next year.”

The company transported 96 containers of modified toilets which arrived together with all the marquees and gazebos. These arrived in 174 containers on a temporary importation and were delivered to all the various

stadia where soccer matches took place during the Confederations Cup. “We have since collected and exported them,” said McDonald. “They will then be re-imported again next year for the 2010 event for which the number of containers is expected to be around 450.”

SDV Durban, a part of SDV SA and SDV Africa, which is a logistics brand under the newly branded Bollore Africa Logistics network, is present in over 40 countries and employs over 18 600 permanent staff in Africa. The company specialises in abnormal loads and recently completed the delivery of 266 loads of machinery from Durban to the DCP mine in Kolwezi in the DRC. Says McDonald: “The cargo consisted of four Terex excavators weighing 540 tons each. These were all disassembled and required 17 abnormal loads to transport one complete machine to the mine site some 3 800km away.”

He said two major challenges faced were to drive or rig some disassembled pieces under a bridge with a maximum height of 4.8 metres and to cross a

raging river via a barge.

“We have also been awarded 37 000 tons of food aid that will be warehoused in Durban before being transported by road to different warehouses in Zimbabwe,” said McDonald. “This food aid is critical for Zimbabwe and our challenge will be to deliver the entire tonnage within ten weeks.”

McDonald believes that being a successful logistics provider is all about being able to deliver on promises.

“It means being in partnership with our customers, especially when the economy is tough such as it is now. We will limp along the same road together, trying to provide an additional crutch that will assist with the limp.”

This type of partnership, he says, builds confidence and ensures that the recovery is less painful.

Having just moved into new premises in the Riverside Business Park in Durban, SDV Durban has also purchased its own transport company and now has over 400 trucks and 900 different trailer combinations for the transport of cargo into southern Africa.

The new SDV Durban premises in the Riverside Business Park in Durban.

An 85-ton transformer transported from Durban to Tenke mine in the DRC by SDV Durban. It had to be rigged under a bridge height of 4.8 metres.

A 68-ton disassembled piece from the Terex excavator which weighed 540 tons assembled – recently moved by SDV Durban.

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New supply chain body formed

By Alan Peat

A

call for “thinking out of the box” comes from Mike Johnston of consultants, Logistics Management, and president of the Southern African roundtable of Supply Chain Management Professionals (CSCMP).

He told FTW that business leaders and the SA government needed to start thinking out of the box a little more to ensure that there is room for the economic growth and sustainability of the freight industry.

There is just too much focus from government and businesses on short-term solutions to challenges facing the industry.

“By not creating permanent solutions to real issues,” Johnston said, “we have to keep revisiting things that should be sorted out once and for all.”

It’s time for businesses to start doing their homework properly, he added.

“Companies are too rigid and are not thinking about the long-term future.

“It is essential that within the supply chain there is room for flexibility. Change is inevitable – so allow for it.”

Johnston felt that the need to create some consistency and uniformity within the supply chain management industry was a driving force behind a new industry body.

The various associations and institutes involved in the industry have formed a body called the Federation of Supply

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Chain Management Associations (FSCMA).

“The need for such a body has existed for some time,” said Johnston, “although formation of the organisation only occurred this year. The member associations of the federation strive to create an influencing and co-ordinating body that will address issues affecting the industry.’

Current members of the FSCMA include the SA Association of Operations Management (Sapics), the Road Freight Association (RFA), the SA Institute for Industrial Engineering (SAIIE), the Institute of Purchasing and Supply of SA (Ipsa), the SA Association of Freight Forwarders (Saaff) and the Southern African Roundtable of the Council of Supply Chain Management Professionals (CSCMP).

One of the reasons for creating the FSCMA was to close the gap that exists between government and the supply chain industry, according to Johnston.

“There is a lack of understanding of definitions and concepts within the industry. For example, at the urging of minister of finance, Trevor Manuel, each government department is having to appoint supply chain managers.

“A quick look at their job descriptions tells you that they are procurement managers, and not supply chain managers.

This type of confusion is not helping us move forward.”

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18 | JULY 2009

Logistics company

achieves top empowerment ranking Owner-driver scheme proves its grass-roots worth

T

ransport and logistics company Cargo Carriers was recently ranked third in the transport division of the 2009 Top Empowerment Companies (TEC) survey, achieving the highest Preferential Procurement score (17.83%) of the top five companies listed in the division.

A significant part of Cargo Carriers’ empowerment programme is its owner-driver scheme that was launched in 2003 in business areas identified as receptive to the concept, says owner-driver manager John Sprenger.

“Existing employees who had the correct attributes were actively encouraged and supported by Cargo Carriers to become entrepreneurs through owning their own vehicles and driving on behalf of the company,” Sprenger told FTW. “The aim of the owner driver programme is to empower drivers who would otherwise never have an opportunity to become successful entrepreneurs – and an important aspect is the training and the business experience they gain, which they can

Arnold Garber

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pass on to their families and local communities.”

The success of the scheme however requires a stringent selection and training process, says Sprenger, which results in the owner-drivers entering a

‘The success of the scheme requires a stringent selection and training process, which results in the owner-drivers entering a service agreement with Cargo Carriers to become independent contractors.’ service agreement with Cargo Carriers to become independent contractors to the company, as opposed to employees. Training covers a broad spectrum of skills, from driving and communications to finance and life skills.

“The owner-drivers are assisted with their finances and unique packages are developed and monitored by a third party administration

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company to ensure they are in order, statutory returns are submitted, high cost areas are controlled, and retirement funding and medical aid policies are in place.”

The four initial owner-drivers selected almost six years ago proved the success of the programme when their service agreement was renewed for a further three years in August 2008, says Sprenger. Since the programme was initiated in 2003 the company has trained 20 owner-drivers, with plans under way to expand this programme.

“Real empowerment is a corporate imperative for Cargo Carriers. The owner-driver scheme fosters true participation in the building of South Africa and the economy,” said Sprenger.

“Given South Africa’s history, empowerment at a grassroots level such as that which is achieved by the owner-driver scheme is an imperative for Cargo Carriers in positively contributing to those individuals and societies that we engage with every day.”

Hackers expect to score in 2010

By Ed Richardson Logistics companies are advised to take extra precautions to ensure their systems are safe from hackers, spam overload and virus attacks leading up to the 2010 Fifa World Cup. This warning comes from the Symantec division at Workgroup, which says Fifa-related spam is set to grow in the run-up to the event.

Justice Mcebi, product manager for Symantec at Workgroup, says Symantec’s monthly spam surveys report that around 10% of all spam in 2008 was fraud-related, such as those advertising fake tickets.

“During the previous Fifa World Cup, related phishing attacks jumped by 40%,” he says.

“As many as 4 615 phishing hosts per month were discovered in 2008, which was a rise of 66% over the previous year.”

Mcebi says that three basic types of information need to be protected around global events: availability, integrity and confidentiality.

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20 | JULY 2009

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Maersk finds innovative answer to trailer clutter in US

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Maersk is trying a new approach to solve one of the most intractable problems that leads to logistics managers and port directors in the US tearing their hair out – the hundreds of thousands of container trailers that clutter up terminals

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‘The company is hiring out its trailers, known as chassis, for a fixed daily rate to local cartage companies.’ throughout the country and slow down cargo movement.

The company is hiring out its trailers, known as chassis, for a fixed daily rate to local cartage companies, ocean carriers, marine terminals and railways. Trucking companies will be required to sign a contract under which they assume liability for the equipment and provide coverage through their own

insurance policies Outstripped by more efficient ports in Europe and Asia, which move containers in automated yards by overhead gantries, the US is hamstrung by outdated yards where boxes are shifted by tractor or truck and where each load moved has often to be exchanged for another chassis.

Maersk has formed a new company, Direct Chassislink, which will pool 5 000 trailers in New York before going national with all 90 000 units. Six industry pools operate in a number of cities, owned by Consolidated Chassis Management, but Maersk only participates in Denver, partly because the industry pools do not want all the additional Maersk equipment.

“Trucks will not have to wait in slow-moving lines on marine terminals to pick up a chassis,” Bill Williams, Maersk Line vice president of health, safety and environment, said in news reports.

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JULY 2009 | 21

Independent companies

pool resources to improve customer service Each specialising in a different overborder country

By Liesl Venter

I

n trying economic times, diversity and innovation may just be the name of the game.

And for those reasons Ka Go 2 Go, Cargo 2 Congo, Whitelion and Nyati Cross Border have pooled their knowledge and expertise, broadening their reach by joining forces while still operating as individual companies.

“It just made sense to work together as it gives us an added value and we are all able to service our clients better,” says Richard Hall of Ka Go 2 Go. “We all operate independently, but at the same time we can join forces to provide customers with access to a fleet of more than 100 vehicles if required.”

And they can offer access to most southern African countries. With each company specialising in a specific country, the client gets the benefit of the knowledge and experience, says Sandra De Kock, director of Whitelion. “Because we remain independent companies, we

retain our niche markets. We are therefore not competition to each other, but rather complement each other’s business.”

With Nyati Cross Border specialising in Angola, Cargo 2 Congo in the Congo, Ka Go 2 Go in Zambia and Whitelion in Mozambique, the four companies can go further together than they would have done alone.

“We have also all been let down at some point or another by subcontractors,” says Gary Hall of Cargo 2 Congo. “Having reliable partnerships is very important and by working together we are putting our names alongside each other and that takes trust. But because there is trust, there is also dependability.”

Friedel Kirstein of Nyati Cross Border agrees. He says having access to a larger fleet, and being able to rely on the experience of the other companies, makes business sense. “You are also extending your reach exponentially and you don’t have to be an expert on every region, because you have access to the

Friedel Kirstein of Nyati Cross Border, Richard Hall of Ka Go 2 Go, Gary Hall of Cargo 2 Congo and Sandra de Kock of Whitelion have joined forces and are sharing expertise. various experts.”

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here is little economic justification for significant investment in the Eastern Cape's freight rail infrastructure, according to a 10-year plan tabled by the province's Department of Roads and Transport.

According to the plan, the province has 3 500 km of Cape gauge railway, but with only limited freight capacity.

The major line in the province with significant current capacity is the 370km long line between Port Elizabeth and Noupoort, which is capable of handling “reasonably long trains with 20 ton axles at speeds of more than 80 kph and is electrified with a relatively modern 25 kV AC system,” says the report.

This line carries 3.5MT of the total of 4.5MT moved by rail annually in the province. The bulk of the tonnage is made up of manganese ore which is shipped through the Port Elizabeth harbour.

It adds “the existing port at Port Elizabeth is adequately catered for and rail developments are under way to cater for the new port and related developments at Coega”.

The only other freight line “of some current significance is the approximately 400km long line between Buffalo City

and the Orange river at Bethulie”.

This is under threat as “reduced activity in the East London port is also leading to a reduction of the line’s status over time. The East London port requires upgrading to accommodate larger ships and increase its volumes and is served adequately by rail for the limited freight that is currently being shipped,” says the report.

All other lines that have not been abandoned can only carry relatively short trains with axle loads of 18.5 tons or less at speeds of around 50 kph or slower.

There are approximately 1 400 km of abandoned lines, with little economic justification for reviving these rail links. “It was concluded that the E Cape should not focus on linkages to external provinces or on the re- development of any branch lines,” say the authors.

Looking at future growth opportunities, the report says “if Mthatha could be developed as a hub for processing, warehousing and distributing forestry and agriculture products going to the East London Port and a variety of products coming from East London to satisfy the needs of farmers and forestry companies, seed, fertilisers, tools, mechanical equipment, etc then freight volumes may make rail more viable”.

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JULY 2009 | 23

‘An American pencil versus China’ on the menu at supply chain expo

T

he recent 2009 Sapics Conference fielded a diverse mix of presentations, from pencils to pharmaceuticals, South Africa to San Diego, lean to green, and oil to outsourcing, providing international and South Africanflavoured offerings to suit the tastes of all of the 800-plus delegates who attended.

The Association for Operations Management of Southern Africa (Sapics) hosts the annual event in collaboration with the Supply Chain Council.

Dr Stephen Franks, strategic adviser at RiverLogic Inc in the United States, demonstrated to delegates the competitive opportunities to be found in the global financial crisis.

“This global cash crunch seems irreversible, and without new rules of engagement, the challenges for growth will be insurmountable,” Franks said. “However, there is a silver lining - it is called Integrated Business Planning (IBP).”

He demonstrated how IBP provided the strategic planning and consistency framework that unified plans across business functions.

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“Using this framework, you will understand how to quickly identify and capture shortterm, cash-generating opportunities to fund longterm strategic growth.” He used international, real-world examples to prove the point.

In a case study entitled “An American Pencil vs China”, David Seeber, vice president of manufacturing at the General Pencil Company, USA, a manufacturer of classic wooden pencils, shared his experiences in competing with China’s vast, low-cost manufacturing capabilities. Seeber said he had worked to make the US pencil manufacturing industry more competitive by designing and implementing manufacturing techniques that minimised labour, improved quality, shortened delivery time and reduced costs.

China featured once again in the form of speaker Kien Leong, general manager at JCIT Asia Pacific in China. His presentation on “Planning and Execution Excellence for Customer Fulfilment” challenged some of the assumptions and logic

that are at the heart of production and material planning. He demonstrated how manufacturers could make substantial improvements to their operating performance by simply looking at the planning cycle in a different way. Drawing on both concepts and real-life examples, he led the attendees through a journey

of planning and execution excellence.

Supply chain excellence – particularly in the pharmaceutical industry – was the topic of a presentation by Rod de Spong, chief financial officer of Douglas Pharma, New Zealand’s largest pharmaceutical company. De Spong examined how supply chain excellence and the SCOR model had accelerated his firm’s growth and profitability.

Part of the African mix at this year’s conference was Douw Jooste, manager: supply chain enablement, Sasol Oil, South Africa who looked at the “Migration of Sasol Oil to a Supply Chain Organisation”. He noted that Sasol Oil had embarked on a business redesign to meet changing market conditions and customer needs. Substantial changes were implemented regarding process design, supply chain strategy and organisation design, as well as the increased use of appropriate technology. “The implementation process to date has introduced a number of changes but has also created a number of learnings useful for future similar projects,” Jooste noted.

24 | JULY 2009

Road Transport to SAIL pushes rail Angola and DRC M

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ulti-modal company SA Inland Logistics is using its position on a rail link and near the Durban harbour to offer efficient transferability between road, rail and sea modes of transport.

“We intend pursuing the rail market more aggressively in the next few months,” says SAIL’s Gerald Naidu. “Our strength and skills are in this field and our research has revealed that the industry needs new blood from an experienced team.”

The expansion of rail transport routes

in the company is viewed as a promising investment as it has provided the company with opportunities in accessing the overborder market.

“We see major growth in the overborder market and have already commenced with some loads into Malawi and Zambia,” says Naidu.

Another reason for expanding in rail is the current truck queues at the Durban Container Terminal.

“This waiting period is costing the economy and end customers as transporters have to now factor in these delays when pricing their services – not to mention the increased risk of accidents.”

New express services from East and West

By Michelle Hardy A new express imports service from Europe and the Far East has been introduced by Linex Air Services.

New air routes have also been opened by the company, with options of Ho Chi Minh City in Vietnam (Tan Son Nhat International) and the US gateway Los Angeles (LAX International).

The company is also making it easier to track cargo.

“We are developing a new in-house

system called SAM,” says Martine Forbes of Linex. “This allows client systems to seamlessly integrate with our system.”

Linex’s continued growth locally and internationally is due, in part, to clients affected by the economic crisis turning to specialised logistics companies for help, says Forbes, “By allowing us to manage the channel for the movement of goods, the company can focus on what they do best.”

JULY 2009 | 25

Vehicle industry

looks to logistics to contain costs Lessons to be learnt from Russian response

By Ed Richardson

M

otor industry logistics is coming under the spotlight in South Africa and the rest of the world as the industry battles to survive in the face of falling sales.

There are parallels between the Russian auto market, which has seen a more than 50% drop in sales in some segments, and South Africa – both of which had years of record sales accompanied by shortages of some models.

“The issue for us today is no longer the lack of (road transport) fleets or capacity,” Natalia Petrenko, vehicle logistics director for Ford in Russia told the Automotive Logistics Russia conference in Moscow recently.

“Our job has actually become more difficult as we have to improve lead times to meet our customers' expectations.”

Electronic voting by delegates at the conference put government policy, including customs, as the most significant current challenge for logistics in Russia, above issues such as

The Durban car terminal ... an industry battling to survive. infrastructure or investment.

South African organisations putting pressure on government to fight corruption are cautioned to plan for unintended consequences: Vladislav Zaslavskij, president of the Association

of Car Importers and Customs Brokers, said that Russian customs was stifled by bureaucracy and hampered by efforts to quell possible corruption.

“Anti-corruption measures have made it difficult for the customs officials to

initiate any new measures,” he said.

“The managers of the federal customs feel as though they are participants in a reality TV show, as all of their offices and cars are bugged and being recorded.”

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operating in South Africa. “The application is designed to improve internal operational processing, enhance management control and provide better communication with parties or systems outside of the forwarding or clearing functionality.

“We have many multinational clients who have forwarding and accounting packages prescribed for their use by their parent company that do not always fully address the local demands – for example the SA Revenue Service MAS requirements or real-time credit checking,” says Sims.

Core Freight has provided solutions for these clients, he says, “improving their overall systems functionality through the use of robust modern technology and innovative design. It is a proven system tailor-made for South African requirements.”

But the need for effective systems is not restricted to large multinational players and smaller agents should equally consider their options, says Sims. “The

Jonathan Sims … ‘The need for effective systems is not restricted to large multinational players.’

CoreFreight application can be used over the internet and this provides access to a modern fully functional forwarding and clearing package in a secure cost-effective manner for these operators,” says Sims.

Understanding what can be achieved through modern IT practice is essential to remaining competitive

as the logistics industry evolves.

“Now is as good a time as any for South African operators to review their systems to determine not only if they provide an effective solution to their current processing requirements but also if their organisations are prepared to face the challenges of the future.”

GRAPHITE 2526

ow more than ever companies need to optimise every component in the logistics supply chain in order to derive overall gains in efficiency, says Jonathan Sims of Core Freight Systems.

“This includes IT systems as much as the other elements responsible for the physical movement of the goods,” he told FTW. And while it is highly unlikely that any single application will optimally service all the systems requirements of all the parties across the chain, this needn’t be viewed as a negative, he said.

“Principals and service providers can then select the ‘best of breed’ applications for the specific functionality they require in their individual areas of operation and these different applications should then be connected to supply the overall supply chain system requirement.”

Core Freight Systems specialises in the provision of an application for use in the forwarding and clearing aspect of logistics for companies

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JULY 2009 | 27

Sophisticated seals provide real-time cargo tracking Focusing on the trailer and its cargo rather than the cab

S

afety along the container supply chain is no longer just a simple case of locking a box with a reinforced padlock, according to Kevin Norwitz, MD of security sealing company, Vikela Aluvin.

Dealing with sophisticated criminal gangs, security specialists have to be equally high-tech in their products, he told FTW. In Aluvin’s case, the latest evidence of its efforts are local trials of stateof-the-art electronic security seals being conducted with certain large customers in conjunction with EJ Brooks, the largest security sealing company in the world.

According to Norwitz, the products undergoing the trials are variations of the GlobalTrak high security electronic seal – a unit that qualifies under all the international conditions laid down by world bodies. It is C-TPAT compliant and combined with an advanced GPS and/or GSM tracking device to provide the end user with real-time tracking and event information.

“These high security bolt seals with electronic capability are currently

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being used successfully in the US and the Far East,” said Norwitz. “Vikela, along with Brooks, is now focusing on South Africa, and then the rest of Africa, because of the seals’ capabilities in remote and high-risk areas,” said Norwitz.

He added that the underlying concept was that the seals communicated to an Information Management Bureau (IMB) – enabling the user to track the location and status of the cargo at any point along the journey.

“Our system is substantially different from the standard vehicle management systems,” said Norwitz.

“The most important difference is that it focuses on the trailer and its cargo as opposed to the cab. These standard tracking systems could report that everything is in order because the cab is where it should be, but could have failed to pick up that the actual cargo had been tampered with or removed completely.”

At the end of the journey the bolt seal is cut off and disposed of, but the electronic tracking equipment is reusable and rechargeable.

Thinking of buying your business premises?

By Ed Richardson

Kevin Norwitz … ‘Seals communicate to an Information Management Bureau (IMB), enabling the user to track the location and status of the cargo at any point along the journey.’

Companies intending to purchase their warehouses, workshops or offices are warned that they could lose their option to buy if there is a change of ownership of the buildings.

This follows a Supreme Court decision handed down in June 2009 which ruled that the obligations arising from an option to purchase the leased property, granted by the landlord, are not automatically transferred to the purchaser of the property.

“Essentially, a tenant that has been granted an option to purchase leased property has to ensure that it exercises its option to purchase the premises against the original grantor of the option,” says Bridgett Majola of Shepstone & Wylie Attorneys.

“The key is, therefore, to exercise the option before the original landlord or grantor sells the premises or to ensure that the purchaser is given notice of and agrees to be bound by the option,” she says.

28 | JULY 2009

Scoring with 2010 Fifa World Cup Robertson Freight, Neil Robertson.

Based in Cape Town, Robertson Freight specialises in connecting with the niche markets of the West African region.

He says the shipment is an example of how the World Cup can be a catalyst for tremendous growth in the logistics industry – including small companies, such as the family owned Robertson Freight.

Smaller companies have the advantage of flexibility. “We have and will always offer the best

By Michelle Hardy

L

ogistics companies are already benefiting from the 2010 Fifa Soccer World Cup. “We are extremely excited about a recent project undertaken, along with our associates in Germany, where we were called upon to co-ordinate the movement of various broadcasting, surveillance and logistical support units for a privately owned and renowned German studio,” says co-director of

'value-for-money' solutions to our clients, by researching all projects undertaken prior to starting any project,” says Robertson.

Neil Robertson … ‘connecting with the niche markets of the West African region.’

Investing in ‘human systems’ the way to go Value-added initiatives on the menu systems that address the customer’s needs, not our own,” he says.

Proof of the power of people is that the company has grown to the point where it offers all modes of transport to almost every corner of the globe. It also provides the services of in-house logistics departments to its clients, handling the entire logistics process from purchase order to proof of

By Michelle Hardy While many companies are either retrenching or putting a freeze on employment, people are the best “systems” for the job, believes Deon Botha of Globogistics.

“One can go a lot further with the right people, backed up with proper procedures and simple user-friendly

delivery.

With the focus on people over systems, Globistics is able to implement an average of one new value-added initiative a week. “Improvements regarding transport use alone are an ongoing exercise, not just in terms of cost, but service as well,” says Botha.

“Frequencies, routing, transhipments, lead times and external changes

come into play – especially when one works with time-sensitive cargo with demanding deadlines.”

Globogistics has also moved away from the days where additional costs are simply passed on to the customer.

Should there be any additional costs (for example standing time or storage) the aim would be to recover these from the responsible party.

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