INDUSTRY FOCUS: LOGISTICS

Continued from page 28 operate in is very challenging,” smiles Schmidt, highlighting some of the current hurdles.

“We run to Mozambique and Richards Bay where we export a lot of coal, and the ports are jampacked. Those ports are just parking lots at this stage – there is a lot of frustration amongst drivers. The roads are not great, and there are problems with labour. Transnet should be doing so much more volume by rail. We don’t talk about it much as we accept it as part of life. But, as South Africans, we have learned to navigate around it. If you try to fight all of the challenges at once, you will be frustrated for the rest of your life.”

At the South African Roads Federation (SARF) Conference held in Cape Town in October 2022, SANRAL admitted the country faces a pothole crisis across its road network but committed to working with local governments to resolve the issue.

Tengwa works hand-in-hand with its fleet partner to understand and avoid costly delays, and it brings expertise across multiple tedious-butnecessary procedures to allow vehicles to remain focused on the road ahead.

“We own the clients, and we manage that relationship,” says Schmidt. “They have their own team and depots and people who liaise with drivers. We manage the efficiency of the loading and offloading, crossing the border, paperwork, duties, requisite permits, and we handle the follow up and tracking. We take ownership of the fleet operating efficiently. The fleet owner must make money by operating efficiently. We are the client facing entity and we make profit. Together, we ensure everyone is happy. We have the expertise to ensure that the flow is efficient.”

He adds that this model is not common in South Africa, with many competitors owning large fleets. But this brings its own challenges as they must be kept busy at all times, and must be busy with the right type of work.

“Vehicles must be on the move. You can probably stand a vehicle for a couple of days in a month before you start to lose money. Covid had an impact on fleet movement, and that is part of the reason we took the decision to become asset light.”

Tengwa’s strength was demonstrated in the past year, following a number of upgrades and adoption of tried and tested systems. Schmidt and Burger have helped to install new technology and software that is industry-recognised and streamlined. This is just part of the journey as the company hopes to make use of more technology (currently busy rolling out data analytics and tracking coverage) to add further value to client operations.

“We are a clear enabler when moving product,” highlights Schmidt. “We move lots of fertiliser locally – we moved more than 30,000 tons from South Africa to Zambia in just the previous season. With magnetite, we moved almost one million tons in a year – that is something we are proud of.

“We are progressive in our thinking, we have done a lot, and we want to go to the market to get our name known.”

Refreshing Influence

ETG has helped Tengwa to become more efficient through access to trade flows from partners across the group. While opening new doors for growth, ETG also operates an autopilot strategy, sharing vision, but leaving Tengwa to make decisions and cruise in its own lane.

“That is refreshing when compared with many of the bigger logistics corporates in South Africa,” says Schmidt. “They are very entrepreneurial. They have a strategy which they share with us, but they let us run the business. We develop and execute a strategy. They expect results but they don’t interfere.”

Burger agrees: “Their biggest influence comes from group flow and volume. ETG owns a large fertiliser organsation and they handle grain and maize trading. When they complete those trades, we get to be involved in some of those movements.”

Growth for Tengwa is about reinforcing relationships with clients and helping to move more cargo around Africa, while continuing to build a strong base of high-quality systems and processes that deliver regional presence, global reach, for Africa and beyond.

“In my view, it is about getting our operating model right and getting systems right. Typically, people in this space do not plan well. Clients get frustrated and people don’t get paid as they should – brokerage can become a mess. We have set the back office up professionally, with proper systems and proper people, and that is an enabler for taking on the big jobs. A backbone that works is key,” states Schmidt.

He adds that deeper relationships with clients means a holistic understanding of problems, and how Tengwa can deliver solutions. A neverending need to learn means that the industry stays exciting. “You understand the dynamics of different industries,” he says. “We learn about complex national retail operations, we learn about what goes into steel manufacturing, we learn why copper is important and how we must handle the cargo. It never stops.”

This is a business excited about the future, not anchored by negativity, but looking beyond the horizon for opportunity.

“Tengwa is not the same Tengwa from five years ago. We have gone through a lot of change and we are geared to move big volumes, providing great service, at competitive prices.

“We have access to flows, we have good clients, and we are bullish and positive,” Schmidt concludes.