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Lee Griffiths, managing
director: “You have to have
people who are an authority on what they do.”
The right mix
The winner of the 2018 BIFA Ocean Services Award was NNR Global Logistics, which has gained a firm foothold in the market and has no intention of slowing down
BIFA said NNR Global Logistics scooped the 2018 BIFA Ocean Services because the company “demonstrated a strategic response to the volatility of the container market by taking a long-term strategic approach based on being regarded as a trusted advisor to its clients”. However, NNR is a relatively new kid on the block in the ocean freight sector. So how did it establish that reputation for reliability so quickly?
Multimodal requirement Lee Griffiths, managing director, explained: “NNR Air Cargo changed to NNR Global Logistics less than two decades ago. The addition of ocean freight services to our business is only ‘recent’ in relation to our 110- year history. You have got to be multimodal to serve your customers these days – they prefer to use just one provider if possible, so as to minimise disruptions and simplify communication.
“As a new player in a mature market, pragmatism suggested that an effort to be the cheapest was a strategy unlikely to succeed. We planned carefully and resourced accordingly. Our offerings were based upon a carefully assessed selection of carriers: those who were
August 2019
synonymous with a higher quality of service.” The group’s ocean cargo grew steadily; within 10 years it had achieved double-digit growth year-on-year and was managing over 30,000 teu per annum. Volumes are now over 150,000 teu per annum, with growth in the UK of 32% in the last year alone. Griffiths acknowledged the importance of technology in the digital age. Indeed, IT is a key focus for NNR. It develops all of its own IT systems, with nothing off the shelf, and may well enter BIFA’s Supply Chain Management Award next time around. However: “You have to have people who are an authority on what they do,” he stressed. “You need to know when to use technology, and how to mix digitalisation with personal service. We call it ‘East meets West’, and the magic is in the middle – where we are. “When we started out in ocean cargo, a lot of
people were seconded from our air freight business as there are some transferable skills that apply equally to ocean freight. Mostly, though, we have acquired industry moguls. This is a volatile industry, and people change jobs frequently – but we offer a secure, stable position, which is attractive. The average term here is eight-and-a- half years across 117 people.” That mix of inter-personal skills, technological know-how and industry experience has helped NNR navigate the turbulent ocean freight sector thus far. According to Griffiths, the volatility in the market comes about because vessel owners’ pricing strategy is confused.
Constant disruption He outlined: “They drop the market price to gather volume to fill their ships. They end up carrying low-yield cargo, so they reduce sailings, which brings supply and demand back into kilter – so prices go up again. “There is disruption all the time, but we have
built relationships that enable us to get access to the right capacity. Our global procurement strategy also helps us to find consistency, as we benefit from group buying with pooled volumes while still being able to adapt to particular markets or situations. Of course, the idea is not to kill carriers – we need to find a happy medium.” Griffiths noted that pricing used to be fairly
steady, but in today’s competitive market, subject to antitrust laws, that situation is unlikely to return for any sustained period of time. Whatever happens, he is confident that demand for NNR’s ocean freight services will rise 15% year-on-year for the next five years, and the company is on track to meet its growth targets.
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