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No quick fix solution to SA logistics industry’s Covid contagion

Home Transport & Logistics Exports & Imports No quick fix solution to SA logistics industry’s Covid contagion

WHILE there has been a slight uptick in domestic and international cargo traffic in recent weeks, South Africa is struggling to counter the fallout of the Covid-19 pandemic and lockdown responses, and there will be no “quick fix” to the situation.

That’s according to industry body, the South African Association of Freight Forwarders (SAAFF), which said overall maritime cargo for January 2021 was down 15% compared to the same time last year.

Global container imbalances, port congestion and poor efficiency have taken their toll, and the hoped-for bump in cargo traffic after the “hard” level 5 lockdown was lifted did not materialise. February 2021 proved to be a much-improved month for air cargo, as the public started to adopt more positive sentiment towards flying both domestically and in Southern Africa.

However, SAAFF warns the short-term outlook is not expected to improve while the operational curfew persists, even if the medium-term outlook looks slightly better.

One of the hardest hit areas has been road freight. As documented in the media and industry publications, severe cross-border transit delays were experienced on the North-South corridors. According to SAAFF, in one week in February the average cross-border queue time at Beit Bridge averaged 19.6 hours, costing the industry an estimated R450-million.

The air, sea and road freight environment has been extremely challenging for logistics companies, to be sure.

Despite these circumstances, they have found a way to not only maintain operational standards, but pursue new ways of thinking to deliver to clients.

Marcus Ellappan, the Director of Road Freight at Bidvest International Logistics (BIL) said the company had been successful in negotiating the turbulent waters of the pandemic thanks to its approach of limiting wastage. From top management down, everyone in the business had taken a “hands-on” approach to ensure that nothing is left to chance and stakeholders are engaged every step of the way.

“There are solutions in the detail. You’ve got to look at the low hanging fruit and getting quick wins like saving on fuel costs. Ask if you getting the best fuel consumption? Are you getting the best deal on fuel purchases?,” Ellappan said.

“Investing in skills is a no-brainer. The returns are exponential with a skilled workforce. You also need to engage, engage and engage with clients. You need to understand their business and look for win-win scenarios.”

He said a lot of waste occurred in supply chains simply because there was a lack of engagement.  He also recommends automating manual tasks where possible. “This creates a fresh look to business and also eliminates conventional methods of doing things.”

The United Nations Conference for Trade and Development (UNCTAD) notes in that in 2020 there had been continued migration towards e-commerce, with online purchases increasing by between 6% and 10% across product categories. This fact is not lost on Ellappan, but a balance between benefitting from e-commerce and exercising vigilance needs to be struck.

“We envisage a lot more e-commerce platforms for booking vehicles popping up, but one needs to be wary of some of these platforms,” he said. “Without the correct compliance, this could result in more road freight incidents which include crashes, hijacking, unfair labour practices and uncompetitive transport rates which does not level the playing fields from a compliance perspective.

“While leveraging off technology is definitely the way to go, road freight has many variables that need to be managed legally. These platforms should not focus on mainly booking the ‘cheapest’ hauler.”

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