Future vision

With the launch of a brand new airfreight hub in Dubai, TNT Express continues its high-powered mission to dominate the Middle East market
Future vision
Bryan Moulds
By Robeel Haq
Mon 25 Apr 2011 10:33 AM

What comes into mind when
you hear the name ‘TNT Express’? Unquestionably the brand is synonymous with
reliable and efficient express services – making it the first port of call to
many who require a product to be delivered within a stringent timescale. It is
this impressive reputation that has seen the company go from strength to
strength to establish itself as one of the world’s leading express delivery
service providers - distributing over 4.4 million parcels, documents and pieces
of freight across the globe every week. TNT Express is certainly no stranger to
the Middle East market either. Operating a
network that extends across all GCC and Levant
countries, the company has been express delivering in the region for well over
25 years now. But with so much success and repute in the express market, why is
the company turning its aspiring eye to dominating the Middle
East’s logistics industry?

It is all part of the
global company’s ambitious forward plan – ‘Vision 2015’ – which sees TNT
Express diversifying its products to give itself the competitive edge in an
unpredictable and recession-battered economy. The Middle
East is one of the regions that have been earmarked for tremendous
growth potential. “The best way to describe our presence here is one of bended
knee, and we are beginning to straighten up,” says Bryan Moulds, TNT Middle
East’s ambitious regional managing director.

Moulds appreciates that
the past ten years has been witness to a huge change in the region’s mentality,
transforming the UAE in particular, to a vibrant emerging platform – bursting
with opportunities as it actively diversified its business economy away from
the traditional oil and gas sectors. For the last six years TNT Express has
experienced an impressive CAGR of 30% in the region – with the UAE leading the
way.

It comes as no surprise,
therefore, that when the express operator decided to build its very own hub, it
would choose the UAE as its location. Last month, TNT inaugurated its new air
cargo handling facility at Dubai
International Airport
in the prestigious company of His Highness Sheikh Ahmed Bin Saeed Al Maktoum,
president of the Dubai Civil Aviation Authority and chairman of Dubai Airports
and staunch supporter of the hub. “In a way this has been a long time coming,”
says Moulds. “Our previous presence was limited to just 234m2 and so to change
that to a 3000m2 platform has been quite a considerable leap in size. However,
this investment was critical for our continued growth plans in the
region.”

Indeed, from TNT’s
perspective, the implications of having its own air cargo hub are enormous.
Firstly, it enables the company to hugely expand its future growth potential
with a view to handle an increasingly significant volume of cargo as the
economy picks up speed. Secondly, the hub brings along with it the capacity for
TNT to process its own equipment, namely its fleet of Boeing 767s, 777s and
747s. “In the past, we wouldn’t have been able to process that kind of
equipment given our platform size,” explains Moulds. “Now, we can align and
consolidate all of our Middle East materials, whether from Bahrain, Kuwait,
Saudi Arabia
or the UAE, through our new hub and into the rest of the market.”

The company also recently
launched a dedicated B767 freighter, with a daily connection between its Dubai hub and European air hub in Liege, Belgium.
“This enables us to link two major intercontinental platforms through one
dedicated corridor,” says Moulds. “Having this facility now open and operating
allows us to connect the leading platform geographies of the world so we can
become more aggressive in the market place and break into these intercontinental
streams.” The new air cargo hub represents the central axle in TNT Express’
massive growth plans to conquer the Middle East
by providing faster, more cost effective and more reliable logistics services
to the region. “Some would say that we are just opening a warehouse and that
may be true,” Moulds argues. “But the significance of opening that warehouse is
critical for TNT’s further development in the UAE and Middle
East.”

Indeed, with the volumes
on TNT’s freight network between these key hub destinations (UAE and Europe)
showing more than 30% growth last year, the timing of the company’s
‘aggressive’ development plans could not be better. “We want even more
visibility in the marketplace so that customers are made very conscious that
TNT is a major player here,” emphasises Moulds. “We are capable of picking up
on the freight market just as much as the express market, but some of our
potential customers may not necessarily know this.” These potential customers
can expect to see plenty more vehicles on the roads and more planes landing
with TNT logos emblazoned on their sides. TNT Express is one company that is
not shy of shouting out its presence in the region in order to drum up
business. “Essentially, we aim to get more enquiries from customers that may be
using some of our competitors,” says Moulds. “We have a strong competitive
advantage as we can offer a much more diverse product range than others.”

Although TNT’s brand is
synonymous with the express product range, it is the company’s ‘deferred
express’ services which have been fast gaining momentum regionally. “This is
what gives us the differentiation,” enthuses Moulds. “We offer a product range
that gives the market place the choice of whether they need premium end express
products or whether they need dedicated transit times that have a deferred
transit option in them and potentially save money.” With the global economy
slowly clambering back from the recession, saving money is often the primary
goal of many from TNT Express’ customer base and as an unsurprising result, the
company has witnessed a shift in demand for the more cost-efficient deferred
express product. “Supply chains in general are one of the first areas that are
looked at to save costs in company dynamics,” Moulds points out. “As a
consequence, express products are not growing as quickly as they used to and
deferred products are becoming more sought after as they potentially save money
for customers in the supply chain.”

Whilst TNT Express has
long provided the deferred express service, more commonly known as ‘Economy
Express’, the product experienced a sharp increase in popularity following on
the recession. Moulds has been quick to pick up on this and react accordingly.
“Although the most important part of our business is our premium end products,
you have to be realistic about what the market expectations are,” he explains.
“Customers are very conscious about costs and so will try to defer the speed of
their products when it can save them money.” Partly as a result of diversifying
its product portfolio, the operator has weathered the recession rather well
from a Middle East point of view. Despite a
marketplace that remains ‘tricky’, the company has been growing at double digit
figures this year and Moulds expects to finish the year with between 18-20%
growth across the Middle East. “During the
recession, we did see a small decline and when we normalised the numbers, we
virtually stood still,” he admits. “But we understood that with the ability to
diversify, not just in the express market but outside of it, we could continue
growing.”

In particular, this growth
is being fuelled the hi-tech, automotive and retail sectors as they begin to
increasingly move larger volumes of high-value goods on TNT’s trade lanes. The
company received a further boost to its volume growth last month, when it was
formally approved for the transport of hazardous goods throughout the region
after meeting stringent IATA criteria on its air networks and operational
handling facilities.

“Now that we have the
ability to move hazardous goods on the air network, this basically allows us to
connect all markets with all of our product range - whether they be hazardous
or not,” says Moulds. “It lends itself to another avenue and opportunity to
diversify into additional platforms.”

Moulds has every right to
be excited about TNT Express’ future growth in the region. He himself was
appointed to the post of managing director earlier this year, and now has
responsibility for operations in Jordan, Saudi
Arabia, Bahrain,
Kuwait, the United Arab Emirates, as well as agents in the
wider Middle East and Indian subcontinent.
Armed with immense enthusiasm and belief in the potential in the region, he has
been a key driver in the company’s huge local success. He also brings with him
many years of solid experience, having begun his TNT career back in the UK in 1989,
before moving to the UAE in 2000. “It certainly has been 21 busy years,” Moulds
recalls, smiling.

And the ambitious regional
managing director has no intention of stopping there. With more serious
investments planned for the future, TNT is keen to fulfill all its potential in
the region. “We are well placed for growth over the next five years and have
the capacity to both take on and handle that level of growth,” says Moulds.
“This is important as not putting the investment in first can sometimes stunt
your development and make it difficult to retain 20-30% growth – it isn’t an
easy thing to keep up with. A little bit of forethought, and I see us being
very different from what we are today.”

With the air cargo hub in
place, TNT Express is well on its way to stamping its reputation as a key
logistics leader in the future. So where does Moulds think the company will be
in ten years time? “I don’t think we will just be considered the small parcel
mover that, generally speaking, people associate TNT with in the marketplace,”
says Moulds. “We will a lot bigger, and if we are not number one in the
marketplace, then we will certainly be one of the first brands that customers
think of when considering their logistics and express operations.”

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.