Payment depends on proof of delivery process
KEVIN MAYHEW
LOGISTICS OPERATORS should view the distribution of emergency aid in southern Africa with the same urgency as just in time or highly perishable cargo.
“The reason,” says Mike Newell, regional logistics co-ordinator of Oxfam, one of the most influential non-governmental agencies in southern Africa, “is quite simply that lives are at stake.”
Oxfam is currently running programmes in Zimbabwe, Zambia, Mozambique, Malawi and Angola and spends about R6m per annum on its own logistics capacity. A further R21m annually is channelled into the logistics industry based on the accepted norm that about 14% of the cost of products from South Africa is used for logistics.
“We have our own short haul transport capacity that we use from depots in southern African countries to rural areas where aid is needed – generally to communities with acute basic needs such as food, water and sanitation,” said Newell.
Capacity checks
“The long hauls – usually out of South Africa – are undertaken by outside transporters whose capacity to deliver on time to meet our distribution timetables is paramount. For that reason we check the capacity of any accredited freight forwarder and transporter to see that they can deliver to these requirements,” he explained.
Oxfam does not generally get directly involved in contracting long haul transporters but leaves it to its suppliers to work with people with whom they are comfortable. However, the agency reserves the right to check the credentials of the suppliers’ transporters to make certain that they adhere to internationally accepted practices with regard to overtime for drivers and their ethical standpoints.
One of the key ethical concerns is that of corruption and bribery – at any level. Disqualification for such practices is shared amongst the major aid agencies so contravention of these codes of practice leads to immediate blacklisting, he said.
Late payments
On the issue of late payments for logistics services – particularly for warehousing when bureaucracy delays cross-border movement for excessive periods – he said Oxfam relied on the freight forwarders to clear the way.
“We will, however, try to help if we feel that something unforeseen has happened and we believe our help will achieve our principal objective of getting aid through. But, if it is shoddy preparation by the service provider, then we hold them responsible and penalty clauses will be effected,” he added.
“At Oxfam we have a specific process of payment on proof of delivery at certain points, but ultimately we have to know that the aid got through successfully and in acceptable condition before we can pay. As we work mainly through suppliers paying their freight forwarders and transporters, the problem of payment does not lie with us but with the relationship between the supplier and his service providers,” he added.
