Critical mass works in favour of customers

RAY SMUTS LCL GRINDROD has turned in a ‘stable’ performance with total volumes up 20% and the three South African offices handling just under 150 000 pallets for the year. What is more, as challenging as it may be, the company anticipates an 8% increase over last year. Commenting on long-term profitability, Johan le Roux of LCL Grindrod says logistics is a low margin, high volume business requiring a substantial critical mass. “We believe we have reached a point where our critical mass allows us to contribute to the development of all of our customers, without being under pressure to expand our customer base.” The mission for LCL Grindrod for the year ahead is to strive toward expanding its product offering and in so doing extend services throughout the overall supply chain on a door-to-door basis. “It makes financial sense,” says Le Roux. “We and our customers benefit through being in control of the entire supply chain, enabling them to assume as much risk as they are comfortable with.” At the end of the day, LCL Grindrod’s ultimate objective is to attain ‘total cost reduction’, while also enabling customers to develop their business on a pro-active basis. This is substantially aided through the company’s world-wide office network, allowing them (customers) to sell fruit to buyers in all major markets, without having to experience restrictions on the logistical side of their businesses. Planning and marketing is in full swing for the 2007/08 season and LCL Grindrod anticipates a ‘lively’ first six months as indicators point to export volumes exceeding 2006/07 levels, due to favourable winter climatic conditions in the Western Cape. “We foresee the strong demand for containerised shipments during the current season will be carried forward to next year," says Le Roux.