‘It’s all about ensuring a fair deal for all parties’

For the Nicolella brothers it’s been
full steam ahead since they bought
out commodity broking company
Meridian Shipping some six years
ago.
While they have been involved
in running the business for the
past 20 years, since the buy-out
they’ve have managed to grow
their volumes ten-fold, with the
company moving 3 500-5 000
containers a month to worldwide
destinations.
While good timing has certainly
played a role, they believe that
their customer-centric approach
has been a big part of their success.
And it’s the kind of success
that comes at a price – but for
Guglielmo and Yvan, taking
their laptops to the beach and
dealing with customer queries
while opening Christmas presents
is a small price to pay for the
independence and fulfilment that
Meridian Shipping has brought to
the family.
While Guglielmo had dreams
of joining the navy as he watched
vessels sailing in and out of
Durban harbour during his early
years growing up in the port city,
commercial shipping was never a
career ambition.
He joined Meridian Shipping in
1990 with Yvan coming on board
two years later – and when a full
buy-out opportunity arose in 2006,
they were up for the challenge and
have never looked back.
Acting as middlemen between
traders and shipping lines, their
objective is to get the best deal
and service for the customer. “But
we believe in partnering with the
shipping line – because that’s in
everyone’s best interests,” says
Guglielmo.
“And although we’ve often
been approached to get involved
in packing, warehousing and
transport, we prefer to focus on
what we’re good at and what we
can manage.”
The company initially focused
on steel and asbestos exports, but it
has now diversified in product and
destination, serving traders of all
sizes to a range of destinations.
The East is its major market
– with 50-60% of its volumes
moving on this trade lane – but it’s
not all about massive commodity
shipments to China. “We’ll do a
40-foot container of biscuits to
Port Louis if that’s what the trader
needs.”
According to Yvan, 2007 was a
watershed year.
“We were fortunate in that we
had positioned ourselves well in
the market when the boom hit in
China and we were in the right
place at the right time – and
business has continued to escalate
ever since.
“We have remained focused
during these years on what
we do best and we believe the
main benefit for the client is the
customer service that we provide.”
“It’s all about the family values
of integrity and transparency,”
says Guglielmo, “and we believe
that this has a lot to do with
our success in maintaining and
increasing our customer base.”
But it’s not plain sailing by any
means.
“One of the biggest challenges
in South Africa is the lack of
infrastructure in the country,
strikes, port congestion, delays
and changes at the port, the
inconsistency of rail – and,
depending on the buoyancy in
the market – capacity and lack of
equipment.
Two or three years ago
space was at a premium,
but tougher market
conditions have meant
easier access to capacity.
And while at times
having to drive a hard
bargain with the lines is
part and parcel of what
commodity broking is all
about, it’s also about trying
to ensure a fair deal for all
parties, says Yvan.
Freight rates are now a
third of what they were in
2008 and half of what they
were in 2006 – which could
be an indication of the dire
circumstances in which
the shipping lines find
themselves. And that comes
back to Yvan’s earlier
contention that it’s all
about finding the balance
between partnering with
the lines while still having
the clients’ best interests at
heart.
Ten years ago lines
were happy to negotiate
an annual contract – but
they’re now dealing on a
monthly basis or even a
spot basis – which makes
it difficult for the trader to
plan ahead.
“Even getting a rate for
three months is difficult
and hardly ever achieved
these days,” he said.
Competition in the field
of commodity broking has
also escalated dramatically
over the past decade. “Ten
years ago commodity
broking was limited to two
or three companies – there
are now 20-30 vying for
the same business,” says
Guglielmo.
Clearly the shipping
landscape has changed
dramatically, but for the
Nicolella brothers the
basics of a successful
business will never change
– hard work, know-how,
obsessive attention to
customer service – and, of
course, integrity.