Logistics industry must address issue of rising costs

South Africa’s logistics
industry will have to find
ways of adapting to its everchanging
environment where
rising costs are just one of the
challenges to overcome.
That’s the view of Francis
Kingston, underwriting
manager for Lombard
Insurance, who says that
rising fuel costs, additional
toll fees and the strong rand
are just some of the economic
factors that affect the way
organisations in the industry
operate.
“In addition there is always
the threat of strike action,
such as the Transnet strike in
April 2010, that crippled the
industry for over a month – the
ramifications of which are still
being felt today.”
On the legislative side
companies need to be aware
of the implementation of the
New Companies Act and The
Consumer Protection Act, with
the new Customs Act hovering
on the horizon, he added.
“The South African economy
is slowly showing signs of
growth, but as Greece has
shown us, the global financial
crisis is not yet over and many
developed countries around the
world are heavily indebted,”
says Kingston. “Until all these
issues have been sorted out,
we can expect only a tentative
approach to global economic
recovery and significant
growth.”
According to Kingston,
one of the largest assets (and
risks) on a company’s balance
sheet is its debtors’ book.
“Companies should seriously
consider taking out credit
insurance on their debtors’
book if they have not done so
already.”