Kuehne + Nagel increase efficiency with Europe restructure
Global logistics giant Kuehne + Nagel (KN) have announced the restructuring of their European operations in the first step of a ‘comprehensive programme for increases in efficiency’.
In an online statement released on their website, KN explained it will optimise its regional structure beginning July 2013, beginning by merging the current organisational units of ‘Central Europe’, ‘North West Europe’ and ‘Southwest Europe’ into one central region.
The new region, dubbed ‘West Europe’, will be based in Hamburg, whereas the region ‘East Europe’, which has head offices in Vienna will remain the same.
In view of the growing trades between Africa and the Middle East, the regional units ‘Middle East / Central Asia’ and ‘Africa’ will be consolidated. The management of the new region ‘Middle East / Africa’ will be headquartered in Dubai.
In order to maximise business opportunities in the Asia-Pacific region, two regional teams will be established. The national companies China, Hong Kong, Taiwan and Macau will belong to the region “North Asia” as of July 1, 2013, with headquarters in Shanghai.
The region “South Asia” will consist of the South Asian countries South Korea and Japan, and will be headquartered in Singapore. The structures in the regions North and South America will remain unchanged.
These changes follow a number of changes at KN, following the resignation of the Group’s CEO, Reinhard Lange, and a new drive to implement cost saving efficiencies following a fall in net earnings for 2012.
An online statement releasing the company’s operating results summarized: ‘Compared to the previous year, the company increased volumes in all business units despite slower international trade growth. However, results were negatively impacted by declining profit margins, cost increases and an antitrust fine of CHF 65 million imposed by the European Commission in March 2012.’
Karl Gernandt, Chairman of the Board of Directors of Kuehne + Nagel International AG: “In the difficult market environment 2012 the strategy of the Kuehne + Nagel Group to focus on regional and industry-specific growth segments has proven its worth. However, we did not manage to adjust our costs in a timely manner everywhere; as a result we had to experience setbacks in profitability in several countries. Taking this into consideration, Kuehne + Nagel will realign its management and organisational structures in order to react more quickly and efficiently to market demands and growth potentials. From our new members to the Management Board we expect important impulses for the operational development of the business units Contract Logistics and Road & Rail Logistics.”
Cainiao Network Launches Customer-Centric Logistics
As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.
Who Is Cainiao?
According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00.
For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’.
What’s Part of the Upgrade?
Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments:
- Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions.
- Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture.
- Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency.
- Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311).
Where is the Company Headed?
From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’.
Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’.