The Italian logistics company is bucking the trend to grow by acquiring other companies, relying instead on its own organic growth. This long-term and proven strategy was emphasized by leading managers of the Florence, Italy-headquartered firm during the opening ceremony of its new Bremen station last Thursday (03FEB22). It is the company’s fourth branch office in Germany.
Horizontal, not vertical growth
Acquisitions are in vogue. This is demonstrated by recent takeovers. For example, APM Maersk's purchase of freight forwarder, Senator International; Hapag-Lloyd's acquisition of Africa
specialist, Nile Dutch; the multimillion-dollar purchase of Ingram Micro's Commerce & Lifecycle Services (CLS) by CMA CGM; or MSC's imminent incorporation of Bollore's Africa business.
“The current trend in shipping is to grow horizontally instead of vertically,” says Andreas Kujawski, Managing Director Germany at Savino del Bene. This is the easiest way for shipping lines to gain additional market share, rather than through large-scale mergers, he adds. This, because the latter hardly generate any notable synergies or price advantages vis-a-vis competitors, as Hapag-Lloyd Chief, Rolf Habben Jansen recently confirmed to the media.
Meanwhile, the exorbitant freight rates that have shot through the roof since the outbreak of Covid-19, have encouraged ocean carriers to go on a spending spree. No wonder, with prices of up to 14,000 USD to ship a 20-foot container from Shanghai to Western Europe. About 3 years ago, customers only had to pay about 10% of that sum for the identical service.
Family-run companies are rarely on the hunt list of the big ones
Hence, smaller agents need to take care not to be swallowed up by the mighty. Unless they are family-owned and have no interest in a change of ownership, as is true of the Florentine logistics company, Savino del Bene. Founded in 1899 and managed by Paolo Nocentini since 1977, it has always remained family-owned and managed through generations, even though shipping line MSC holds a minority stake.
Meanwhile, the company runs offices in 293 locations across the world. It shipped 665,000 TEU in 2021d, manages 40 warehouses, employs 4,300 staff in 55 countries, and offers customers road, rail, and inland waterway freight services, as well as tailored project logistics solutions. Forecasted is a 2021 turnover amounting to 3,000,000 EUR vs. €1,600,000 in 2020.
Emigrants helped Savino del Bene to grow
Although ocean freight is dominant, air freight is a core pillar of the Italian agent’s business as well. Last year, for example, 86,000 tons were transported by plane. This is an increase of 35%, compared to 2020. Key air routes are Milan - New York, and Milan - Chicago.
“Due to historical reasons,” notes manager Kujawski. After all, the origins of Savino del Bene's American business are based on the transport demand of Italian emigrants, whose belongings the forwarder once shipped across the North Atlantic. But today, other items such as refrigerated products, express shipments, or medical goods, have replaced suitcases, and have spurred the role of air freight.
Preferred carrier concept
Savino del Bene cannot compete with the big players in the industry, nor is that its ambition. Instead, the company concentrates on smaller and medium-sized customers, providing tailored services to retain them in the long term.
As far as the product strategy is concerned, the focus is on verticals; for example, pharmaceuticals, automotive or machinery. It offers suppliers its own certification program and - as part of its quality management - pursues a preferred carrier strategy. “We have built special relationships with major cargo carriers, allowing us to secure guaranteed allotments at highly competitive rates.” Cargolux Italia and Lufthansa Cargo are at the top of the list, Mr. Kujawski states.
“But depending on route and capacity, we also cooperate with other cargo airlines; for example, Etihad, Emirates, KLM, or AirBridgeCargo,” he adds. Said this, he points out that “we ensure complete security of cargo, from the moment it is picked up by hand-picked partners, while it is warehoused in facilities equipped with safety systems that comply with all current regulations, and until the final destination, where our local operators take care of customs clearance and delivery procedures.”
From Dusseldorf to Hamburg
Andreas Kujawski has been Managing Director of Savino del Bene in Germany since January 2021. “As a family-run company, we are not driven by quarterly figures, but are given the time to develop products and markets, carefully,” he emphasizes. This also includes the fact that the logistics provider relies on its own performance in its growth strategy and does not intend to gain market share by buying competitors. “We are concentrating on ourselves. Acquisitions are not an issue for us,” he points out.
The Bremen office now opened by the 56-year-old, is Savino del Bene’s 4th branch in Germany, after Frankfurt, Dusseldorf, and Stuttgart. Soon, a 5th station – Hamburg – will be added to the network. The office will be located in downtown Hamburg, right next to the German headquarters of shipping company MSC. Once established, Dusseldorf will lose its role as the agent’s central seat in Germany.
For Kujawski personally, this is very convenient. He lives in the city and will only need about 20 minutes to reach his new HQ from his home.
We welcome and publish comments from all authenticated users