16 minute read
TALKING POINT
Eng. Abdulrahman Al Hatmi, Group CEO, Asyad Group
A QUEST TO SECURE THE FUTURE OF LOGISTICS
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Oman-based Asyad Group is technologically arming itself to meet market needs and empower a more future-proof sector
e need new ideas,” says
WEng. Abdulrahman Al Hatmi, Group CEO, Asyad Group. “I think the world is full of talent and it needs to be tapped. There is a multitude of intellect in the world. Hopefully, we will get some great ideas out of this challenge, and some good minds will come up with fantastic proposals that we can adopt and integrate, and hence make a difference in our business and to the bottom line.”
Asyad Group has already positioned itself as an integrated logistics solutions provider and a logistics hub in the Middle East and North Africa region, but now, it is investing in research and development in order to employ big data and emerging technologies to develop sustainable solutions and future-proof a more resilient global supply chain.
“We see ourselves as a logistics frontrunner in the region in terms of integrating solutions, whether it be shipping, land, or air solutions, and of course, free zone offerings to provide customer with a unique proposition that serves their purpose,” says Al Hatmi, adding that the idea for the Global Logistics Hackathon originates from his belief that technology will help the whole industry to provide the best offering to its customers.
FIT-FOR-PURPOSE SOLUTIONS
In more detail, Al Hatmi explains that he is taking the lead on the technology front in a hope to offer fit-for-purpose solutions to customers and the economy. “We want to couple technological offerings with a
cost benefit analysis to help the economy in terms of employment,” he says, adding how technology can help overcome cultural obstacles.
“For example, working on logistics jobs wasn’t attractive for young people. We then automated the cranes, which are now operated through a control centre. Now, these jobs have become very popular with the locals. It’s a slightly uplifted job that is intellectually challenging. This is a very good example of technology enabling jobs.”
The company is also focusing on employing robotics at fulfilment centres and last mile delivery. “We’re looking at blockchain technology and unified trading solutions where all customers and service providers can access a single platform to meet their needs,” Al Hatmi notes. Artificial intelligence (AI) is another area of interest for Asyad Group. It hopes to use AI to provide commercial information to its teams. “We’re looking at all sorts of technologies that can be put together and hopefully provide a great product, which is a standout solution to our customers and our employees,” he adds.
GOING GLOBAL
Apart from technologically enabling itself, Asyad Group is looking to become a global player by first tapping into the Indian subcontinent and Africa.
“We need to expand our targeted markets beyond the GCC.” Al Hatmi explains. “We need to tap bigger markets. We all know that logistics is a very tough business with small profit margins. Therefore, we need to deal with larger volumes to scale up the business.”
India is quite a promising market, he adds. “The GDP growth is going to be pretty good. I think you’re looking at 7% year-on-year. Africa is an emerging market; they’re still upcoming and now is the right time to support these growing economies. I think that, if we succeed in positioning ourselves as a service provider to these countries, it will be a win-win situation.”
The GCC region, with its 40 million residents, is considered a small market for the logistics sector. Additionally, the region is home to some of the largest logistics firms. This has made competition even tougher for a sector that is already tight on profit margins. “Competition is tough, let’s not shy away from that fact,” Al Hatmy says. “Everybody around us has the same aspirations. Everybody’s driving the diversification agenda to turn away from oil and fossil fuel whether it’s regionally or globally. It’s easy to turn to logistics as a source of diversification. But we cherish good competition because it makes you sharper. It makes the industry much more attractive. And to be honest, if anything that the COVID-19 pandemic has showcased, it is that logistics is a ‘make it or break it’ test for economies. And I think that is probably the key message to take away from this situation.”
Expanding on how the COVID-19 pandemic has drastically impacted global supply chains, causing a lack of products and parts available in the market, Al Hatmi says, “We simply cannot get access to products, as there is a break in the supply chain,” says Al Hatmi. >>>
“Freight rates aren’t going to get better for a year or more due to the chaos. It’s going to take time to settle the chaos. And it’s not just freight rates. It’s a lack of supply. You can’t get enough boxes, containers, or enough ships to move the products. It is affecting the availability, which is worse. So, even if you want to pay, you can’t get material because it’s not available anymore.”
DECENTRALISATION OF SUPPLY CHAINS
Al Hatmi is of the opinion that there is going to be a global shift in the industry. “I think decentralisation will be the name of the game for logistics,” he says. “With the ongoing geo-politics, trade wars and tariffs, decentralisation is the only solution.”
Another issue, he reveals, that is plaguing the industry is the lack of talent. “The competition for the right resources and talent is enormous. We need to find great talent. The sector is redefining itself from offering mundane jobs, such as truck driving and warehouse storekeepers, to enabling highly intellectual, highly demanding careers. Now, you need different sets of skills, such as commercial and technology related skills, to enter the market.”
At the end of the day, Al Hatmi believes that the road ahead is going to be challenging, but it also brings with it opportunities. “The logistics sector is undergoing a major overhaul with technology at the forefront, and we need to be prepared for it to succeed,” Al Hatmi concludes.
EMPOWERING
TRADE SINCE THE LAUNCH OF DP WORLD’S ECOMMERCE PLATFORM DUBUY.COM IN APRIL, THE B2B MARKETPLACE HAS SEEN EXPONENTIAL GROWTH. We sit with Mahmood Al Bastaki, Chief Operating Officer at DT World - DP World to tell us more.
Africa has always been a strategic market for DP World, the Emirati multinational logistics company has been investing in the continent for a few years now. Earlier this year in April, it announced the launch of DUBUY.com, a global wholesale eCommerce platform, available first in Rwanda and Ethiopia with plans to expand across Africa and eventually around the world.
DUBUY.com adds digital trading corridors to the physical corridors DP World has built across the African continent with its investment in ports, terminals, and logistics operations. “The marketplace represents a new model of partnership with the UAE, designed to strengthen the existing potential in Africa,” says Mahmood Al Bastaki, Chief Operating Officer of Dubai Trade World. “This technology allows home grown businesses to become international manufacturers and exporters - by linking them with new markets in Africa, the Middle East and eventually the rest of the world,” he adds. >>>
FORAY INTO KENYA
In October, the platform was introduced in Kenya. Within just six months the platform has become a major gateway for trade in the East Africa region. “Kenya is very strategic for us as a hub in the eastern part of Africa,” he reveals.
“The country has the potential to embrace our eCommerce platform. Looking at Kenya’s demography, the internet penetration is quite good, with just over 40%. The smartphone spread is 98% and active social media users are 20% of the population.”
Furthermore, Kenya and UAE have a good trade relationship. “They welcome international investments and are keen to partner with UAE,” Mahmood notes. In 2019, UAE’s export to Kenya was valued at about USD1.8 billion.
Kenya’s 2030 Vision of transforming the country into a newly industrialising, middle-income country fits in with DUBUY.com’s vision of digitally connecting Kenyan buyers and sellers with the rest of the world.
DP World has also partnered with Kenyan National Chamber of Commerce to connect with key logistics providers and solution providers. It has also collaborated with governments of states to strengthen its presence in the continent. Mahmood explains in detail: “This way we’re building trust in the platform for buyers in Africa. There’s a lot of purchasing happening through mobile devices as well as mobile payments and we’re leveraging on that for the success of our eCommerce platform. We are a brand they can trust.
“Africa is an upcoming continent with a large young population between the ages of 18 to 30. These young people are the future. They are embracing technology. Our aspiration as an eCommerce platform is to be global, to buy from anywhere, and ship to anywhere. That’s the whole idea. But our focus at the beginning is to tackle the Africa region.”
FURTHER EXPANSION
DP World has a presence in 11 African countries and further expanding its footprint in the region. In July, it acquired JSE-listed Imperial Logistics, an integrated logistics and market access company with operations mainly across the African continent and in Europe.
“We see huge potential in Africa. It is providing us with a lot of opportunities, and we offer them many prospects too. It’s a two-way street. We go as a partner - creating jobs, enhancing competencies, and offering training.
We grow the economy together and participate in the sustainable development of the nation. That’s the whole essence of our eCommerce offering deployed in Africa,” he reveals.
The combination of DUBUY.com’s advanced technology and DP World’s physical infrastructure offers a secure and reliable way for organisations in Kenya to develop, expand and crucially, improve supply chain connectivity and resilience as the country recover from the COVID-19 pandemic.
It will also solve some of the key challenges facing the growth of eCommerce in Africa, including reliable fulfilment, secure financial transactions, and the movement of goods.
DP World is leaving no stone unturned to ensure DUBUY.com is a success. Since its launch the marketplace has undergone several enhancements to better user browsing experience. Additionally, newer payments methods are added. Mahmood adds: “We offer all kinds of payment methods, mobile, credit card, wire transfer and recently we began offering mPesa. It is quite popular in the eastern Africa region, and customers use it and trust it.”
The site was recently enriched with new products as well. “When we launched, we had 17,000 products. Today, we are showcasing 200,000 products on the platform. We have an aspiration to reach a million in the next nine to 12 months,” he notes.
So far, Mahmood is quite happy with the reception DUBUY.com is receiving in the markets it operates in. “The number of products has increased. Website visits exceeded 550,000 hits. We see keen interest from customers to browse our view products, compare prices, and to try out certain shipments. We just don’t include products from the UAE, we also have sellers from India, China, Turkey, and the US.”
Expanding on which products are popular on the platform, Mahmood says: “We’ve seen a huge demand for automobile parts and have a good number of products in our offering. There are good number of electronics - computer screens, devices for phones, mobile phones, accessories - and some FMCG products. Additionally, there is demand for PPE items such as safety gears like mask and gloves that have been used during the pandemic.”
Seeing a demand for automotive and spare parts, a used car category was introduced and has been well received in the marketplace, Mahmood reveals.
MEETING DEMANDS
The reason for DUBUY.com’s success has been simple, according to Mahmood. “We’re meeting a demand. Both the buyer and seller have access to a large database. For the seller, instead of being restricted to small number of buyers. They have a wider net to market their products to. Same for the buyers they are not limited to a small net of sellers.”
Explaining further, he says: “For buyers to sell more we are integrating a new solution in the site, digital trade finance. We would like the sellers to sell more and the buyers to buy more. The only restriction most businesses have is the access to cash and funds, this drought often impedes their growth and the continuity of placing more orders.
“We are fixing with a ‘buy now and pay later’ solution, which will be provided over the next couple of months. Buyers know we provide a hassle-free service. They know that DUBUY.com is a trustworthy place. A big concern for sellers is ‘will the buyer pay on time’ They may ship the products but if the buyers don’t pay it becomes a cause for concern, here we take full responsibility. >>>
“We mediate the payment process and ensure the sellers receive their money. We offer a secure payment platform. This way the seller has liberty and freedom to put more products out and enrich their offering to prospective buyers.”
Mahmood divulges that DP World has big plans for the marketplace. “We want to DUBUY.com to be a global player. We want to enable B2B trade in every corner of the world in a professional, easy, and quick manner. We want DUBUY.com to be the platform of choice, a differentiator, and a hope to the SMEs around the world.”
Expanding on the pipeline for the marketplace, he says: “We are transparent and work with full integrity. We would like the world to trust us and use this to grow their business, this is your gate to the world, and the world to you. This is our aspiration; we will be launching continent by continent. We plan to introduce one million products online by next year and five million in the next couple of years.”
In phase one of its plan, DUBUY.com will be launched in 19 African countries, phase two includes all of Africa. “We want the African countries to trade among each other. This is based on the agreement that was signed and follows the African Continental Free Trade Area pact.”
Mahmood also hopes that with Common Market for Eastern and Southern Africa (COMESA) in place that allows for cross border trading among African countries with ease and less restriction of tax and duties, and customs duties, there will be increased trading on the platform. “In Africa, you’ll see us grow much faster in the coming months,” he says.
That being said, all necessary precautions are being taken into consideration. He elaborates: “We are tackling one by one country at a time. We don’t want to rush into opening the platform to everybody at this stage. It’s critical because a simple mistake can devastate our reputation. We are now sure that in the coming weeks Kenyan traders will enjoy our eCommerce offering and will reap the benefits of trading on the platform.
“As we grow and expand there will be new products demanded that the suppliers don’t have, or a certain country doesn’t supply. We will work out the demand and supply challenges, which is a big challenge in these areas. Things will be ironed out as we go ahead.”
CHALLENGES AND HURDLES
As an eCommerce platform, the biggest challenges it faces are cyber security issues. “We can’t relax for a single second until every loophole is closed and every possible situation is explored. We have hired the best experts in cyber security and regularly host ethical hacking sessions,” he says.
“We’ve put up the right firewalls, use the latest technology to ensure are not left blindsided or victims of hacking, phishing or website spoofing.”
Some of the non-digital challenges the DP World faces in Africa are warehousing, lack of proper infrastructure, availability of trucks, vans, and containers. He adds: “In fact, availability of containers is becoming a global challenge impeding trade.”
Further explaining on the supply chain woes that have frustrated every possible sector, he says: “Just as we began to recover from the lockdowns, the industry was hit with a shock of scarcity of containers. Shipping line increasing their freight rates to astronomical numbers, which was never witnessed in the last 50 years.”
With shipping company ranking in millions of dollars due to high demand of containers, businesses across the world are hit with a logistics knot that shows few signs of improving.
“The pandemic has brought to light how reliance on a single market can be devasting. With DUBUY.com, we will open to markets that many never attempted to do business with. Many of these countries have excellent products. “With us being neutral, unbiased to any country, we will openly offer opportunities to countries with good brands to expand their horizons and reach,” Mahmood explains.
GLOBAL TRADER ENABLER
Over the past five years, DP World has gradual moved away from being purely a port operator to function as a global trade enabler. Mahmood says: “A lot of focus from our side is on digitising cargo movements that goes from the sellers to the buyer, and we have accomplished much in the special economic zones, free zones, trucking and logistics areas.”
DP World is heavily investing in the cargo and logistics value chain, Mahmood explains. “DP World knows the ins-andout of logistics and the core competencies of eCommerce. We have immense experience in this field and are serving buyers and the sellers across the globe. So, for us it was a natural evolution and a progression to get into eCommerce. “We want our customers to continue using our ports and our facilities by giving them an eCommerce solution with a full end-to-end offering.”
He adds that the brand name of DP World is “very strong” which has a presence in the global logistics market. “Customers trust this name. They know they can transact securely and put their money in the company. Our brand offers them that guarantee.”
For DP World, technology is at the core of its business. It has established its own innovation centres and programmes to seek out smarter solutions for the logistics sector. “Whether it be artificial intelligence, machine learning, data science or IoT we’re investing in all these fields,” Mahmood explains.
“Technology is no longer an accessory to us; it’s become a necessity. It’s the future. There is a huge push towards the digitising the supply chain in a holistic manner, digitising the freight forwarding business, and the tracking and tracing capabilities in DP World,” he concludes.
