RUSSIA/EASTERN EUROPE\\\
Business booms as Eastern Europe joins the caravan club
The Hull region is the centre of Britain’s caravan manufacturing industry – in itself one of the UK’s
lesser known business
success stories. There has in fact been quite a boom in exports, not of new caravans, but mostly secondhand ones destined mainly for Poland and Lithuania, as well as Kaliningrad and even further afield, says Mike Straw, managing director of Hull-based Seaway Logistics. The company was formed in 2010 aſter the voluntary liquidation of Assco Humber (which in turn was previously Anglo Soviet Shipping, the agency of the once extensive
Soviet commercial fleet). Assco Humber, which faced a
shortfall in its pension fund, paid off its debts, its existing directors retired and Mike Straw took over the running of the new business, together with a small staff of three former Assco employees. A brisk trade has developed in
secondhand caravans to Poland and the Baltic. Hauliers arrive in Hull to collect new caravans for holiday resorts all over Britain, and they usually bring the secondhand one that is being replaced with them. These are then exported. Previously, the usual route from Hull was by ferry to the
Redhead in Russia Redhead International’s
longstanding relationship with Militzer & Munch is paying off with its services to Russia. The German-based logistics specialist offers one of the most comprehensive services to that country, explains marketing manager Austin Duffy. “A lot of companies say they offer services to Russia, but in fact it’s just Moscow and St Petersburg, whereas M+N’s set-up really does cover the whole country. It’s not a matter of dumping stuff in those two cities and then relying on a local haulier to somehow get things there.” M&M has bought two large
distribution companies in Russia which has been the nucleus
of the company’s
expansion in Russia. It now has 400 employees main platforms at Moscow, St Petersburg, Smolensk, Chelyabinsk and Bryansk and through its Trasco subsidiary offers a further six
depots and 400 more staff, But even with the benefits
of a network, Russia is an exceedingly large territory and it can take a long time to get cargo to its destination. “But we can act quicker than most,” says Austin Duffy. Transit time from the UK to Moscow or St Petersburg may be only 12 days, but a further week or more to some of the more remote destinations. Duffy
adds that getting
documentation correct is vital. Redhead and M&M will ensure that everything is in order before goods leave the EU, since goods held by Russian customs for incorrect paperwork can cause huge problems. Redhead International, which
bought out M&M’s UK operation some time ago and acts as its agent here, also employs a Russian national at its Bradford HQ. “Russia is an exciting opportunity for us,” says Duffy.
Netherlands and then by road to destination but increasingly tough road restrictions for abnormal loads – particularly for the larger 3.6 metre wide caravans - was making the journey difficult and expensive. A direct sea voyage from Hull looked increasingly attractive. Here came another cunning
use of spare transport capacity. There is a steady trade in bulk timber in small coaster vessels from the Baltic to the Humber region and ships are oſten looking for return loads. A typical 3-3,500-tonne coaster can take around 24 caravans – a tweendecker around 30 – giving the ship operators useful revenue on what might otherwise be an empty leg and the caravan owner a cost-effective freight rate. The operation has developed
over the past 2-3 years to the point where it is now a fairly regular
service using TTS vessels; the operator gives Assco first refusal on any returning vessels it has in area, giving around four sailings per month. Other ship operators’ capacity is also used from time to time. Services operate from Hull to Klaipeda, Gdansk and Szczecin and there is also a vessel every three weeks or so to Riga in Latvia In theory, the ships will take
other cargo, but around 95% is currently caravans, says Mike Straw. So far, there doesn’t seem
to be any let-up in demand for caravans in Poland. Many go to holiday parks but they are also used as accommodation on building sites and in Lithuania – where property prices have gone through the roof – as permanent homes. One shipper also moves them on from Lithuania by rail to Ukraine.
Damco sets up in Russia
Damco is another forwarder that has been spreading its influence in Russia, setting up offices in Moscow and the three main port cities of St Petersburg, Novosibirsk and Vladivostok. It is also applying for a broker’s licence – which it hopes to have by February – to smooth out customs clearance. “We like to be able to control
everything from end to end as far as possible,” explains the company’s east Europe CEO, Nick Kyrzakos. Damco’s business in Russia is
growing quite briskly, including project work and even military traffic to Afghanistan. There is also plenty of business beyond Russia in the likes of Kazakhstan and Turkmenistan, Kyrzakos
adds. These days, quite a lot of
the traffic to Russia moves from places like Turkey or East Europe, even though the company controlling it may be based in western Europe. Damco is now looking for
more personnel for its Russian offices. There is no shortage of young logistics professionals, Kyrzakos says, although finding 40-50 year olds with the relevant management experience is harder. “The revolution in 1990 and the collapse of the old Soviet Union is part of that,” he says. ”However, we do have some older employees, particularly on the operational side, and they are very good – they know exactly what they’re doing.”
Issue 1 2013
29 Trade mission
UK business chiefs Trade and Investment minister Lord Green and CBI director-general John Cridland led a mission to Moscow and St Petersburg on 26-29 November. Lord Green described Russia as the UK’s fastest growing major export market with 140 million consumers, offering great opportunities
for British
businesses. Russia’s accession to the World Trade Organisation is also making it easier for British firms to do business there, he
added. The mission aimed to build on
National Export Week earlier in the month. According to the CBI, Russia is
a significant trading partner for British businesses, with more than 600 UK firms already there and UK exports totalling £5 billion. In the last two years, the value of British goods exported to Russia has increased by over 80%. This is expected to grow further as Russia opens up its economy.
It IS rocket science
Volga-Dnepr Airlines has been awarded a Russian Federal Space Agency (Roscosmos) licence to transport rockets and other space
gear, including rocket fuel. Aerospace is already big
business for the airline, which has completed 3,312 such flights for
customers in Germany,
Kazakhstan, Canada, China, Russia, US and France to all the world’s leading space centres.
Bad start for Moscow’s WTO membership
Only three months aſter Russia joined the World Trade Organisation, EU trade commissioner Karel De Gucht was
threatening to it to the
Dispute Settlement Body for failing to live up to its obligations. Brussels was angered by Moscow’s
fees on imported
secondhand cars, its ban on live animal imports; increased tariffs on hundreds of imported products and red tape on its timber exports. Russia
had been “doing
exactly the opposite” of what it was supposed to under the terms of its WTO accession, he said.
Exporting freight to Russia? We’ve got all the right connections.
Visit:
www.redhead-int.com Phone: 01274 464276 Email:
smd@redhead-int.com
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