Logistics firms to boost revenues by expansion
Dubai, October 29, 2013
Supply chain executives are looking to increase revenues by growing in existing markets and expanding into new regional and international territories, said a survey.
Respondents want to focus on the wider Middle East and African countries by introducing new products and services to these markets, said the survey covering supply chain perceptions in the GCC released by Barloworld Logistics Middle East.
The survey is based on independent market intelligence conducted on behalf of Barloworld Logistics by international business consultancy firm Dun & Bradstreet.
Constraints to achieving these goals include frequently changing shipping rates of service providers, constant changes in government rules and regulations, inconsistent cross-border trade rules within the region, and congestion at ports, they said.
About 365 top executives across a wide range of industries from Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE were surveyed to gain their views and feedback on current and future trends in supply chain management in their countries.
The first part of the survey provides a macroeconomic view of how the GCC countries currently fare in comparison to their international counterparts, which is followed by the results and findings of the research, and the third section analyses the key findings and observations of what these mean for supply chain management in the GCC going forward.
The survey showed that the UAE ranked significantly ahead of other GCC countries on all the parameters in the World Bank’s 2012 Global Logistics Performance Index. It also ranked ahead of countries such as Norway, Australia, Ireland, Taiwan and Korea and ahead of larger emerging markets like China and India.
Qatar, the UAE and Saudi Arabia ranked the highest among the GCC countries in the World Economic Forum’s 2013-2014 Global Competitive Index in terms of basic requirements such as efficiency enhancers, innovation and sophistication.
Globally, with the fast pace of change companies in the GCC region are facing the challenges of unpredictable order volumes, constant pressure to reduce costs, exposure to higher levels of risk, and finding and retaining skilled people.
At the same time GCC governments are making large investments in infrastructure developments such as ports and railways to improve efficiency and connectivity. Respondents also rank increased competition from regional and international companies and the unavailability of skilled resources as top constraints to achieving business objectives.
Key supply chain objectives included improving customer service, minimising costs, reducing complexity, increasing efficiency and performance, and upgrading and integrating fragmented IT systems.
Twenty nine percent of respondents believe they have an advanced understanding of supply chain management and use the latest IT systems to integrate logistics functions.
About 58 per cent of companies across the GCC countries outsource part of their supply chain activities to third party service providers, said the survey.
Overall, respondents rated the quality of infrastructure in the GCC as above average, expressing most satisfaction with the road and air infrastructure, which they expressed the lowest satisfaction with existing port infrastructure, although as outlined in the report this is being addressed through large investment and development of ports.
A GCC wide railway network and standardised customs procedures are the most desired infrastructure developments in the short term, with progress in this regard already underway, said the report. - TradeArabia News Service