Optimising southern Africa’s supply chain

The business case for infrastructural development in southern Africa is widely acknowledged. Yet supply chains continue to be constrained by a number of infrastructure backlogs, which require effective public-private sector collaboration to be rectified. Simultaneously, infrastructure improvement must boost intra-African trade and bolster development.

Abrie de Swardt, IMPERIAL Logistics Marketing Director says, “Southern Africa’s economic growth depends on consistently greater movement of goods, with consumer and commodity markets offering significant growth opportunities. Regional expansion could be fast tracked should the public sector harness the strategic and operational expertise of Logistics Service Providers (LSPs).”

It’s a collaborative matter

De Swardt views infrastructure as one of Africa’s critical growth enablers saying, “Capital and resource investment by the public and private sectors must focus on ensuring on-going maintenance and operational improvement of southern Africa’s transportation network.” The region requires solutions that effectively balance road, rail, waterways, pipelines and air.

“Solutions that optimise southern Africa’s end-to-end supply chain must be identified and critically, must be supported by cost effective and efficiency-driven infrastructure,” he says, noting that South Africa’s Infrastructure Commission, currently in the process of being established must tap into the value offered by LSPs.

Reportedly, the Commission aims to improve visibility and coordination around South Africa’s R860-billion public investment drive. Its mandate will include unblocking of regulatory and funding constraints, supporting rail infrastructure revitalisation, addressing the life-cycle maintenance challenge, as well as ensuring systemic selection, planning and large project monitoring.

It’s a strategic matter

“LSPs must become more global, concentrated and segmented around customer types, and universally better at execution,” says de Swardt. “To heighten the strategic role being played, LSPs must enable the value chain to become a change agent for business.”

Are LSPs brought on board for transactional support or are they considered to be a critical strategic resource? What do LSPs need to do to ensure consistent delivery of fundamentals and tangible value? In the current market, more companies are going beyond supply chain cost containment. Demand forecasting, supply chain integration and risk management, for example are increasingly strategic imperatives.

To continuously deliver a sustainable competitive edge to customers, LSPs must balance process, people and technology. “This requires technological supremacy and highly skilled people, tailoring client-specific solutions and applying demand-driven principles, strategic alliances and partnerships,” he says. “Conventional perspectives on logistics and supply chain management must be continuously redefined.”

It’s a developmental matter

In emerging markets, LSPs have much to contribute to socio-economic development through Public-Private Partnerships (PPPs).

De Swardt highlights companies such as Wal-Mart and McDonald’s investment in supplier development. In India, Wal-Mart is “improving the operations of thousands of upstream suppliers.” McDonald’s has “spent six years developing local farmers’ agricultural practices and building a reliable cold chain, which has improved farm yields by 60% and cut chemical and water use by two-thirds. ”

Locally, he says that LSPs bring critical skills such as modal integration, network optimisation, asset maintenance and IT enablement to the table to assist national and provincial departments and municipalities with planning, budgeting and contract management. This support contributes to better functioning communities and cities.

“As LSPs, we have much to contribute to alleviating infrastructure backlogs and thereby, towards improving southern Africa’s competitive position. The industry’s expertise extends from strategic alignment to systems development and implementation and overseeing of on-the-ground operations,” concludes de Swardt.

About IMPERIAL Logistics

IMPERIAL Logistics is a global logistics and supply chain leader that moves business and industry through innovation, inspiration and foresight. Through its established Southern African and International divisions, IMPERIAL Logistics’ service delivery comprises fundamental logistics and end-to-end supply chain management solutions to blue chip customers in almost every industry. As a preferred logistics outsource provider, IMPERIAL Logistics positions itself as an extension of its customer’s business, building its customer’s brand alongside its own. IMPERIAL Logistics Southern Africa is a multi-branded business, categorised into five key divisions, namely Transport and Warehousing, Consumer Products, Specialised Freight, Integration Services and Africa. IMPERIAL Logistics International comprises four operating units, namely Panopa Logistik, neska, IMPERIAL Reederei and Brouwer Shipping. For further information, please visit www.imperiallogistics.co.za.