The global perspective
Brian Cartwright, regional MD, Logistics Executive, meets John Wylie, MD Middle East, Barloworld Logistics
John Wylie Managing Director Middle East for Barloworld Logistics, has had an interesting and varied career encompassing over 27 years of commercial and general management experience in third party logistics across a wide variety of markets and cultures. His early career began in the UK and his progression into senior executive roles saw him leading businesses in Western Europe before moving to Saudi Arabia for around 3 years.
He then moved to Central Europe after which he relocated back to the Middle East and he has been living and working in the UAE since late 2008.
John has now been at the helm of Barloworld Middle East for almost three years and has overall responsibility for the business across the entire GCC and parts of Africa. During this time he has grown the business by over 40%, an impressive achievement when you consider the tough trading conditions we have all faced globally over the past few years.
How and when did Barloworld Logistics enter the Middle East market?
Barloworld Logistics acquired Swift Freight in 2008 to gain entry to the Middle East market and given the Swift profile at that time the companys focus was primarily freight forwarding and warehousing. Since then the company has evolved in to a supply chain solution provider that offers contract logistics services and complementary freight forwarding. This major change has aligned us with the core proposition of the South African organisation but it also reflects the opportunities we are seeing in the market.
How would you briefly sum up the core proposition that you mention when you talk about the South African business?
Well, for over 20 years since the business started in Africa, Barloworld Logistics has been supporting and advising its clients with modelling global and regional supply chains, as well as helping them with optimising inventory and demand management processes and facilitating rapid response to changes in global supply and demand. Over the years the business has been able to set itself apart with a suite of world class software products and proven methodologies which has helped us construct and interpret results successfully for clients across many business sectors around the world.
These systems and methodologies have translated extremely well to the Middle East market and the resulting interest has ensured a steady level of growth for our business in this region.
Have the changes to your business model from the earlier Swift Freight approach positively or negatively affected the business?
Our freight forwarding business has contracted in the last 12 months but this is partly a result of the challenging business environment, and also the result of a conscious decision for us to move away from forwarding other than for our existing contract logistics clients and high yield opportunities.
We have also changed our customer mix from where it was three years ago. When I arrived in Barloworld our warehouse clients were mostly transactional and did not require any real value-add services. This has changed particularly since this time last year as our client portfolio has evolved and the services they require have become more complex. But this has been a positive for us as our revenue quality has improved.
Our new business model has also forced us to embrace a fully Integrated Management System. Our customer commitment to continuous improvement has driven us to achieve four ISO accreditations and HACCP certification in the last two years. This has not only improved how we do things but also given us tremendous credibility with customers particularly when we are talking about improving operational excellence in their supply chains.
Do you think the requirement for more in-depth, value added Supply Chain Solutions will continue to grow in this region?
As companies now look to improve working capital and reduce costs, we are seeing a marked increase in demand for us to look at optimising supply chains. I think this trend will continue and so I am investing in resources this year to ensure we have the right people to build appropriate solutions. But it is important to state that we are not consultants who simply tell companies what their issues are and how they might solve them. We rather work with clients to identify the right solution for their business and implement it.
Are you planning any further expansions for the business in the region?
Within the GCC countries, our focus is the UAE and Saudi Arabia but currently we are also working on projects in Kuwait and Oman. Projects in Saudi Arabia have contracted recently due to the reduced oil price but we still see the Saudi market providing a number of opportunities given our business model. There are a number of large companies in the Kingdom that have their own warehouses and transport assets but lack the appropriate management, systems and planning tools. Using our supply chain experts and specialized software we can build the right complementary framework to make best use of the assets, resources and systems.
Barloworld Logistics is also active in African countries such as Kenya, Uganda and Zambia due to contractual commitments for clients based in Dubai. There are a number of opportunities in these African markets and at present we are working with our colleagues in South Africa on a number of 3PL and 4PL solutions.
What do you think about Iran, is that also one of your targets?
Iran is an exciting prospect, we are currently looking at how best to access the market but, given the countrys need to develop its infrastructure in the coming years, there will certainly be opportunities in logistics and supply chain management. I am looking forward to visiting Tehran shortly and getting a sense of the country, the environment and where Barloworld Logistics might play a role in the future.
Given the current global economic environment and all that we have discussed today, how is your business performing in general?
The current market situation is challenging and is impacting volumes and margins. However, as I mentioned earlier, as companies look to drive down costs and optimize their supply chains, we are seeing more opportunities in the 4PL space. So this is having a positive impact for us. The issue with this type of business is that it is lumpy; it has long lead times, is hard to forecast accurately and the people needed to build and deliver the solutions are expensive which increases fixed costs. We counter this in the Middle East by having a relatively small team here in Dubai that works with specialist colleagues in South Africa.
Overall, the business is doing well given the current environment. 2016 is a year for Barloworld Logistics in the Middle East to identify opportunities and build the right framework to provide the right solutions for clients. So I see this as a year to keep things tight and build for the future.