FBJ 4 FREIGHT BUSINESS JOURNAL


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Issue 3 2015 - Freight Business Journal From the Editor


It was pretty inevitable that, following the European Commission’s rejection in 2013 of UPS’s bid for TNT Express, someone would have another go. TNT’s financial results have been fairly gloomy of late, with falling revenues, meagre profit margins and a loss in 2014. A restructuring programme is in place but, financially, the Dutch- based express operator has been doing little more than bump along the bottom these last few months. In a bid to assuage the EU’s competition watchdogs, FedEx, TNT’s would-be new owners, were keen to point out their current lack of presence in Europe, especially in the all- important road delivery sector. Even with the purchase of TNT, the combined company would have a market share of no more than 17%, at least according to one analyst. But as consultants Transport Intelligence quickly pointed out, the real value of the purchase to FedEx would be the opportunity to prise open small but growing markets in China and the developing world. TNT has become something of a niche player in countries such as Asia, and these could be strategically important to FedEx, which is a giant in its home market but not seen by everybody as a true global player. Of course, despite the protestation of the chief executives, the takeover is not a done deal. But the alternatives, to us at least, look rather miserable. It will be sad to lose what was once a swashbuckling pioneer of the global express market, at least as an independent entity, but time marches on.


By Chris Lewis


Being such a well-informed bunch, FBJ readers will know that there is a difference between the Global Shippers’ Forum (GSF) – the UK-headquartered organisation that represents shippers in a diverse range of countries in Australasia, Africa, Asia and South America – and the Global Shippers’ Alliance (GSA), the new organisation that has been set up by the European Shippers’ Council, the Asian Shippers’ Association and the American Association of Exporters and Importers. But with only an ‘F’ and and an ‘A’ to separate the two organisations, could it cause confusion among those not so intimately involved with the freight industry – government and EU departments, or indeed busy people in companies whose remit include shipping among many other responsibilities? Given that, broadly, the two organisations carry out the same sorts of tasks – talking to governments, and other supranational bodies and organisations - and share the same concerns – pricing, competition, regulations and service standards – at some point they may well need to get together and form a united front. True, there are probably differences in approach, but essentially we all want the same things – fair pricing, transparency, competition between carriers and less red tape.


“We come not to bury BIFA but to praise it” – that is the message that comes across from the Chartered Institute of Logistics and Transport on forming a new Freight Forwarders’ Forum. One or two mischief-makers might interpret CILT’s actions as somehow setting up in competition with the British International Freight Association, but CILT people I have spoken to do seem to want to work with BIFA and see the two organisations’ roles as quite different. Potential confusion is never good – see above – but in this case it could be avoided. CILT’s main aim is to raise the profile of the profession and increase its attractiveness to young people. It is a professional organisation; its members are individuals, not companies. BIFA is a trade association, concerned with things like terms and conditions and certain aspects of training, for instance. It also has a role in lobbying government, insofar as the government listens to freight forwarders. Like many trade associations today, BIFA’s resources are also extremely limited. If anyone is willing to shoulder the burden of publicising the industry better, that should be welcomed. Yes, having two organisations involved with freight forwarding might need a certain amount of explanation, but there is no reason why, in time, the two bodies cannot work together where appropriate.


Why should Customs be a black hole?


Much of the resurgence of the UK economy is being driven by the boom in international trade. But with customer expectations on the rise, even the smallest delay passing through customs at UK ports and airports can have a significant business impact. The growth in online businesses


importing and exporting a diverse range of goods from around the world and with growing confidence amongst UK manufacturers, import and export activity is playing an essential role in the country’s improving fortunes. However, the road to success is far from


smooth – and as every retail company knows, the end customer is demanding more. Business customers and consumers are not prepared to wait for goods to be delivered. The entire logistics process is becoming not just a competitive differentiation, but an essential part of the customer experience. Yet while companies can increasingly


gain visibility over key aspects of that journey, including the last delivery mile, there are still aspects of the import/export model that remain opaque - and passing through customs at UK air and seaports


///OPINION


FBJ is the only UK and one of the few pan-European Multimodal newspapers. The comments we have received prove there is still room for a hard copy publication with the freighting industry. You don’t have to look at a screen all day!


FBJ boasts the most informative and authoritative source of information with unrivalled in-depth knowledge of the rapidly changing freight business environment.


As the definitive publication within the sea, air, road and rail freight sectors, each issue includes regular news and analysis, in-depth coverage discovering the business decisions behind the news stories, shipper and exporter reports, opinion, geographical features, political and environmental issues.


If you have any stories or letters which should be of interest or any feedback on FBJ, please contact our editor Chris Lewis - +44 (0)208 6450666 chris.lewis@fj-online.com


next issue >> circulation >>


Our next issue will include features on Malta and Ro-ro. There will also


be our regular IT Section and news pages. For further details contact: John Saunders - +44 (0) 151 427 6800 john.saunders@fj-online.com


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is a key area of concern. While the overall customs process is pretty slick these days, delays still occur - from HMRC document checks to ascertain the accuracy of goods value or incorrect commodity codes, to intervention by Trading Standards or Port Health. A lack of visibility of where goods may be in that process may have a significant knock-on effect on collection, distribution and end customer delivery. Whether it is a two hour delay checking


documentation or a week long physical examination, there will be an impact on the the end customer experience. How can an importer update customers on the actual delivery date of goods without up to date information regarding the arrival on shore and the stage of the customs clearance process? How can a retailer confidently embark upon a promotional campaign with a three month lead time without the ability to track those goods every step of the way, from manufacture to the shop floor?


The issue is not the delay itself, but rather the lack of information on the potential duration of the inspection. The ability to provide traders and customers alike with complete, real-time visibility of goods passing through customs offers clear value and differentiation. Freight forwarders, for example, know whether or not goods have arrived, where they are in the process and when they will be released - so why not share that with customers? Complete end to end visibility of the


supply chain is powerful. Of course, delays will still occur – but armed with that insight, a company has the confidence and ability to respond proactively, to contact customers and provide realistic updates regarding delivery. With visibility of every single stage of the supply chain, organisations can improve the customer experience and achieve far greater financial control. Chris Jones, executive vice-president, marketing and services, Descartes


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