Money-making opportunities for daring logistics companies
For instance, there is a need to meet warehousing and storage demand, which has seen a spike for non-essential inventory.
Picture for illustration. Containers at one of Grindrod Intermodal’s storage facilities. Image: Grindrod Intermodal website
Among the hardest-hit by the coronavirus, the logistics industry currently faces rattled supply chains, a drop in consumer demand, staff decline and disrupted production lines – developments which have adversely impacted retail and purchasing prices.
But the future is not all doom and gloom, according to Mixcorp chief executive Mixo Kobe, who maintains the onus is on company executives to change strategic direction and capitalise on existing markets.
Specialising in bulk handling, loading, shipping, warehousing, containerising and ocean freight management, Mixcorp – a 100% black-owned company – provides logistics solutions to the mineral and mining industry, through more than one mode of transport.
Kobe believes that companies should modify their business models to create sustainability in the local market to remain relevant, while adhering to compliance regulations in what he says is “a narrow market”, by only prioritising goods and services deemed essential.
Resilient, despite a distribution deficit of over 30% for essential goods and services compared to last April’s numbers, Kobe says the domestic logistics sector is set to make a comeback to meet the needs of essential services and production.
Although during lockdown government has plans to assist distressed businesses in the form of grants and financial loans, many logistics companies are leveraging on risk to satisfy the demand for infrastructure and manufacturing commodities.
Says Kobe: “Supply chain management must be completely revised to meet efforts to sustain a coherent reaction to the current operating requirements stipulated by lockdown regulations due to the coronavirus pandemic.”
Initial steps, says Kobe, should include innovative thinking, making provision for long-term sustainability and being adaptable to achieve fiscal recovery.
“For instance, the oil and gas industry has recently opened a detailed discussion in our company as we have a strategy to achieve profitability in goods and services, which fall under the required essentials parameter.
“This transaction alone opens up areas of interest, which require urgent attention such as clarifying whether you will be servicing a company that is providing essential services and how beneficial this new strategy will be to your company.
“Will it be beneficial for the sake of short-term profitability or will it introduce longevity?
“These are questions you need clear answers to.”
There is a need to meet warehousing and storage demand, which has seen a spike for non-essential inventory.
“While only essential goods are permitted to be distributed, non-essential goods are piling up and require storage – a business opportunity, through renting out warehouse facilities for a short term.”
A movement towards a technological revolution in the logistics sector is “pertinent to facilitate functionality in the wake of the Covid-19 pandemic”.
“There is a need to move beyond the man-machine interface to operate productively and profitably.
“There are several technologies available for road and rail, as well as remote-controlled technology, which eliminate proximity as a factor in the operation and management of devices and equipment,” says Kobe.
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