Making the Most of the Dubai Hub

GEFCO’s Stefano Pollotti on the growing need for companies to modernize logistics.

 

Thanks to its location, infrastructure, and relative ease of business, it’s not exactly shocking that Dubai has been hailed so often as the ‘crossroads of East and West’, one of the ‘most strategic commercial hubs in the world’ and an ‘essential traditional trade route’. They might sound like overused phrases, but there is no doubt that Dubai has earned its reputation. What is perhaps a little more surprising is that despite these massive logistical advantages, there is still a reluctance from many companies to capitalize on them.

 

There can often be a lack of understanding in the logistics of importing, exporting, and transportation which leads dealers, manufacturers, and distributors down the wrong path. The archaic view that keeping logistics in-house saves money is simply no longer valid.

 

I believe there are plenty of opportunities to be more time-effective and cost-efficient. Dubai has a rich history as a successful trading post, but the phenomenal effects that have come with the city’s rapid economic rise have changed the way we expand and conduct business but not necessarily the way we think.

 

On a cargo that may cross seven land borders and three shipping zones, we have seen companies try to work out which is the cheapest supplier for each leg of that journey. This is where a consultant can step in and explain that there are one-stop-shop solutions which can deliver discounts, economies of scale, and eliminate the unnecessary investment in time and money. Consultants are not a threat to their logistics set up but we can act as a partner and help them to progress and develop their options. It is a question of mindset as well as business acumen.

 

One of GEFCO’s cost saving strategies was with the distributor of the Korean car makers Hyundai and Kia to Jordan and Iraq. Previously, the cars had been exported directly to Jordan from Korea, which looked like the best option on paper. But taking into account the well-developed customs and import/export procedures of Jebel Ali as well as the length of transit and sophisticated infrastructure, we advised to export through Dubai. Not only did it save considerable costs, it also avoided any possible contact with the Syrian conflict.

 

Logistics, storage, transportation, and distribution are extremely competitive businesses, particularly in this part of the world, and the way to progress is to adopt new practices and accept new services. We are living and working in an age where companies must constantly reassess their operations and outgoings. Even though tough competition is always a danger, false economies can be the greatest threat of all.

 

Many of the developing markets in the Middle East took some time to come to terms with the essential technology that drives the modern logistics industry today. This is something that needs consistent evaluation, revisiting, and where necessary, upgrading. There are no short cuts when it comes to the latest software. Clients will want to be absolutely certain that you have the capabilities to ensure their product will arrive not just in one piece and on time, but that while in transit it will be kept at the appropriate temperature, in the right amount of space, with the relevant humidity, and every other guarantee that it will be in optimum condition upon arrival.

 

There are hundreds of technology solutions to choose from and there is no excuse for not investing in the most effective one – but still it happens. Why would business owners cut corners on an integral part of their operations? The answer, more often than not, is because they don’t understand it and because the business used to run well without it. “Used to” being the operative words. Buying software that is either outdated or inappropriate is nothing more than ticking a box and will ultimately lead to missed deadlines, bad inventory, damaged goods, still stock, and all of the other factors that culminate in high costs and lost business.

 

Dubai is a fierce logistics marketplace and an arena where it’s not just the fittest who will survive, but the brightest who will thrive. Thankfully, we see this complacency diminishing as businesses and boards realize they cannot afford to provide a mediocre service – perhaps we see it less because the companies who were guilty are no longer part of the industry and have paid the price for their own bad practice.

 

As part of one of the most established European integrated logistics providers, we have the infrastructure, the backing, the expertise, and the experience of our GEFCO brand. We have the support to ensure that our own operations are tried, tested, and trusted, but at the same time we can’t rely purely on our heritage. The auto logistics industry plays a significant role in Dubai’s import/export trade and like all of our competitors we must make our case for being the preferred service provider. Whoever you are and whatever your background, you need to stand on your own two feet and prove that you are worthy of being a partner. Again, complacency can be the final nail in the company coffin.

 

There is, of course, an extremely positive element to being part of such an exciting and competitive market for both the buyers and the suppliers. For the clients, the costs are significantly lower and the quality significantly higher as logistics companies vie for business. For the providers there is a constant evolution to refine operations and increase efficiency.,

 

We are in an all-consuming, fluctuating industry that demands continuous investment and rapid development. The Oxford English Dictionary defines logistics as ‘the practical organization that is needed to make a complicated plan successful when a lot of people and equipment are involved’. Easier said than done.

 

About Stefano Pollotti

Stefano Pollotti comes from a truly international logistics background, with senior roles spanning, Holland, Italy and the Middle East.

Having graduated in Engineering and Industrial Management from Italy’s highly prestigious Politecnico di Torino in 1998, Stefano joined the Italian Army as an officer in the Alpine Troupes.

Two years later he began his logistics career in earnest as a Business Development Analyst and Supply Chain Engineer with TNT in Bologna and Milan. In 2003, he moved to TNT’s offices in Milan as Contract Manager before relocating to Holland, where he took on the role as Operations Lean Manager in Amsterdam.

 

In 2007, Stefano returned to Italy as Contract Logistics Director for Italsempione Spa.

He moved to Dubai in 2008, as Contract Logistics Director Middle East for CEVA – formally TNT Logistics and has been Managing Director of GEFCO Middle East since 2012.

Stefano is married with two children and speaks Italian, English and French

 

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