As the warehousing/depot and distribution sector battles the impact of Covid-19, many players have been forced to scale down, says Mndeni Ngcobo, commodities and marketing manager for South Africa Cargo Services (SA Cargo). “They are instead looking into collaboration in order to save on their operational costs.
Although this approach has benefits, limitations such as not having full control of your service offering can be a major concern for all parties. Hence, we believe good old simplified communication is the fixer of it all.”Ngcobo believes that the warehousing sector will grow and will see more developments in future.
Whether this will occur within the next 36 months, however, is highly unlikely. “I doubt that the growth will happen soon, but that does not mean we should rest and wait for things to happen around us. In fact, it is the perfect time for most businesses to pivot and plan long-term strategies and partnerships.”He says like most businesses the biggest challenge at present in the warehousing/depot and distribution sector is around managing costs and efficiencies versus customers’ post-Covid expectations.
“The pandemic has resulted in significant change. Now more than ever customers want a blow-by-blow report of operations. Delivering high-end services and meeting these expectations while guaranteeing profit margins are met is now fast becoming a topic of conversation,” said Ngcobo. “It will be interesting to see how the situation develops in a world where there’s increasing demand for efficient systems.”
According to Ngcobo, while the overall outlook for the coming months is tough, there’s room for collaboration. “One can also now make some strategic moves into new markets or even new sectors.”SA Cargo KZN's warehousing portfolio has recorded positive growth patterns over the past 12 months and the company is looking to replicate this momentum at its other regional locations including Port Elizabeth, Saldanha Bay, Cape Town and East London.
Another important area of focus is digitalisation and the implementation of new t ech nolog y. “Internationally things are more advanced with many of the services semi- to fully automated – and the cost of adding smart technologies into local operations is becoming more feasible. “In Africa, however, we still have to bear in mind that most economies face high unemployment rates and major skills shortages – and in applying technology this must be taken into account.”