Kuwait-headquartered logistics heavyweight Agility has a clear vision: to grow its business without trying to please everybody. Offering customers personalized and reliable services in the air, ocean, road, and rail sectors is the guiding principle for all stations across the globe, emphasizes Markus Lingohr, CEO Area Central Europe.
When managing standard logistics processes, the inclusion of artificial intelligence (AI) can prove to be quite supportive, Mr. Lingohr admits. However, when it comes to solving more complex
challenges, developing customer-centric solutions based on experience and personal expertise, AI (still) has its limits. It might sound old-fashioned, but tailored services nurtured over years
within an enterprise, thus becoming part of a company’s genes, still beat approaches based on machine learning, he is convinced.
“Collaborative services combined and based on know-how are not available off the shelf,” he states, putting Agility’s credo in a nutshell.
His company is already well advanced on this path, he explains, which is proven by long term business relations with leading customers in the automotive, life-science and chemical industries, or by firms producing and selling consumer goods. In order to provide the market with tailored solutions, Agility has categorized these core business fields in sales and service verticals to ensure clear responsibilities and a continuous flow of information from a single source. This approach has demonstrated its worth in practice, as customer feedback shows, he states.
As an example, he mentions pharmaceutical producers or traders who monitor the entire supply chain very closely and evaluate the performance of their transport partners. This is supplemented by periodic audits and data logging of the cold chain from beginning to end, Mr. Lingohr says. “I think in this particular sector, and not only there, we are doing pretty well compared to competitors, as data shows.” This is also true for the other verticals mentioned above, the Hamburg, Germany-based executive adds.
In fiscal 2019, Agility reported a net profit of Kuwait Dinar (KD) 86.8m (€20.08m) and sales reaching KD 1,578.6m (€364.1m), up 1.8% year-on-year.
In the first half-year (H1), ocean and air freight volumes were down 14.8% and 23.6%, respectively, resulting from COVID-19 lockdowns and economic contractions. However, “H1 saw higher yields in air freight, due to capacity shortages and a spike in demand for urgent shipments of PPE and other medical equipment,” the company stated. Consequently, cargo net revenue increased 17% y-o-y, with contract logistics achieving 7% net revenue growth while ocean freight net revenue went south 16%. Growth driver was project logistics with a 25% net revenue increase. It was spurred by “new capital projects and positive volumes from existing customers,” Agility stated.
Not interested in own freighters
Air freight accounts for roughly 35% of the entire annual revenues generated by Agility, whereby the turnover can vary depending on seasons, causing an occasional shift in the ranking of the business segments. “Anyone who now operates a cargo plane can consider themselves lucky,” says the manager, regarding the current boom in air freight. At the same time, he emphasizes that Agility has no ambitions to operate its own freighters, i.e. to follow or copy the asset strategy previously pursued by Panalpina and, more recently, by Maersk. "We do not want to become an airline," Mr. Lingohr emphasizes. “We advocate air charters whenever appropriate and wherever needed, however, regular air traffic is nothing we really consider as an option.”
Different business priorities
Interesting is the different emphasis Agility places on regional markets. While in Europe and North America, the company has made a name for itself primarily as a forwarding agent, on its home turf the Middle East and large parts of Asia, however, contract logistics ranks top on the service portfolio, driven by the many warehouses run by Agility in these markets. A development Mr. Lingohr excludes for Europe. “Here, we do not want to become a warehouse logistician,” he exclaims.
We always welcome your comments to our articles. However, we can only publish them when the sender name is authentic.