By Robeel Haq
Are logistics companies in the Mideast still heading for a bumpy ride in the region? Robeel Haq analyses.
Growth prospects are still available in the Middle East. That is the message that research firm Booz and Company is sending to the global logistics industry with its latest report, which states the GCC market increased in value to US$18 billion in 2008, with further growth being forecast in the coming years.
The report will receive a hero's welcome from the industry, especially at a time when the global media is churning out stories of depressed markets and company closures.
However, looking at the small print, it seems logistics companies are still heading for a bumpy ride in the region. The forecast might be bright, but the market will become more and more competitive, especially with international players flocking to our sunny shores and away from stagnant markets in other parts of the world.
"For local players to survive, they need a strong business platform and the ability to deliver services that match the highest of global standards," the report states with a bleak honesty.
Of course, with a suitable action plan and a determination to succeed, the Middle East is still offering an abundant supply of opportunities. To capitalise on this, Booz and Company has outlined a multi-phase approach that covers everything from organic growth, alliances with international players, expansion into new markets and aligning future ambitions with available budgets and expertise.
We discuss the implications of this report with its author, Fadi Majdalani, in this month's issue, followed by supporting interviews with ten of the smartest players in the Middle East 3PL sector, including Gulf Agency Company (GAC), Aramex and Al-Futtaim Logistics. In addition, our cover story on Global Shipping & Logistics (GSL) provides a great case study on how local companies are continuing to thrive in the face of market challenges. Enjoy the read and we'll see you again next month.
If you have any comments to make on this month's issue, please email Robeel Haq, senior group editor (email@example.com)
Robeel Haq is the senior group editor of ITP Business' transport magazines.
If they aren't shipping it then nobody is buying it. This makes the logistics sector a hot wire to what is happening in manufacturing in the high tech arena. Belly cargo on all airlines is way down and those logistics companies with their own aged fleets of M11s and expensive B747Fs must be smarting, even though fuel is cheaper for now. Aramex, Agility and a few other local players are in a much better positiion, because they have much quicker response times in this changing markets. The big names are lumbering and their overheads are killing them.