Here’s a must-read interview with Scan Global Logistics, together with its CEO for Asia Rickard Ingvarsson, as we learn more about the forwarder’s goal to uncomplicate the world of transport and logistics.
Can you give us a brief background of your air freight network in Asia Pacific? Which country is your biggest market and what are your major plans to expand in the region?
Scan Global Logistics (SGL) has a very strong and expansive presence across Asia Pacific, with its own offices in 11 countries in Asia and 3 countries in the Pacific region. Asia Pacific is in our company split in two, with Pacific currently consisting of Australia, New Zealand, and Japan, while the Asia region stretches from Greater China in the East to Bangladesh in the West and all the countries across Southeast Asia. Greater China (including Hong Kong and Taiwan) is by far the biggest market with 16 locations and counting! In fact, SGL is organically growing across all our markets, whilst we also continue to look for new locations to open in thru M&As or as green fields, some of which will happen during early/mid-2022, so stay tuned!
With lack of belly capacity in ex-China and the region, how does SGL manage to secure the capacity to transport urgent cargo? Is a multimodal approach the way to go when it comes to avoiding port and other disruptions (and reducing costs)?
We have a very powerful and innovative airfreight team with strong carrier relationships, allowing us to have in-depth, creative, and fun discussions with our vendors. Furthermore, I am a strong believer in empowerment, so each person is responsible and accountable for their own actions and decision making within its authorization. I find this culture drives the positive behaviors, such as speed in the decision-making process but also fairness in the discussions with suppliers and customers for that matter, which ultimately allows SGL to secure the needed support in a heartbeat!
Multimodal is for sure a necessary tool in finding new creative ways for our customers to overcome the constant disruptions we have seen since the outbreak of the pandemic, thus offsetting against shortages of capacity and constant price fluctuations. Sea-air, air-sea, land-air etcetera are here to stay but you need to manage them well and set the right expectations.
Were there any instances when you had to work with a new partner (airline or lessor) to deliver much needed capacity? How important are connections in our industry?
Our industry is still a people’s business, and we consider our vendors ‘partners’, this mentality has fared us well as we ride the highs and lows alongside of our suppliers which demonstrates to them, we are in this together! Who you know is important but who knows you is essential! Maintaining good relationships and approaching carriers with trust and respect at the forefront of the relationship will always mean you are pushing on an open door in the future when it comes to new opportunities. Like many others, we also have a pool of core carriers, but we are also not inflexible, we need to be true to our entrepreneurial DNA and find new partners and solutions to serve our customers. At SGL, we have successfully served various UN organizations for decades, just because of our out of box thinking and never say no to a challenge. For the last 2 years plus, we have distributed COVAX and PPE supplies to hundreds of countries, a lot to emerging markets with scarce or no solutions at first sight, and those challenges we like to take on!
SGL went on a buying spree last year and established quite a service for sea and air. Are there any plans for a major acquisition in Asia?
As suggested earlier, we are constantly looking for new customers, new verticals and markets to enter, fully embracing our pioneering spirit. Entrepreneurship is as said in our veins (DNA) and as one of four companies’ virtues (others are Respect, Integrity and Fun). We have a few white spots in Asia that we are intending to fill during 2022 and ahead, but the potential companies that we intend to buy or markets we plan to start in needs to match or add an ingredient to the SGL culture and DNA. We spend a great deal of time getting to know our future colleagues, understanding their values and respect of the culture—and if there’s a spark and a match, the whole integration process will go much smoother.
What can you say about the recent move of major shipping lines and forwarders into air cargo and last-mile? Do you expect this trend to continue?
It’s not the first time carriers buy forwarders and forwarders act as carriers, and these hybrid models can often lead to an uneasy feeling between partners. It’s for sure an interesting and dynamic time we live in, and we simply must wait and see how successful this trend is, but there’s plenty of room for everyone in this market. We respect our suppliers and peers’ strategies and we have ours that works for us and like everything over the last couple of years, SGL must be adaptable to change and manage accordingly. At SGL, we live by the motto, to uncomplicate the world and by making the world a little less complicated for our customers.
Can you share more about what’s unique behind Scan Global’s company culture and DNA? How does the company help with the transition of absorbed staff (from the acquisitions) into this new culture? What’s your advice to the next generation of freight and logistics professionals?
The culture & DNA of Scan Global Logistics is not something that happened overnight, it took us years to mold to stand before us today. Empowering people across our business, whilst adding a pinch of entrepreneurialism and a drop of fun has driven Scan Global Logistics to new heights and will continue to do so. The agile and nimble nature means that we can engage with customers and tailor solutions around their needs, rather than provide a ‘one size fits all’ approach. Some of our most successful products have been built around customers!
The fact that we have a very healthy due diligence process where culture is put at the top of the agenda in terms of a business match often means that when integrating new staff is a lot easier because what has already made their existing company a success means that they can continue to do what they do best in Scan Global Logistics! At the end of the day M&A in an asset light industry like ours must focus on the people and culture as a priority. Of course, after seven acquisitions last year, we have managed to build a bespoke and unique internal team that deals with all aspects of the process, including the on-boarding process of our new colleagues.
My advice for the next generation of freight forwarders would be to act like a sponge and absorb everything! Every day is a learning day in our industry, and I continue to learn new things even though I’ve spent half of my career on this side of the aisle. I also think it’s imperative to understand different cultures and embrace diversity, as that makes your life much more interesting and fun!
