Strike and recession a two-punch whammy

The recent Transnet Strike “ain’t
over ‘cause it’s over” logistics firms
are noting.
“I think the short term repercussion
is we have got a large backlog.
Hopefully you can clear that. For
the long term, if strikes of this nature
continue, all business is in jeopardy,
not just us in logistics,” said Manie
Kruger of Kwela Logistics.
Noting that if their customers
cannot move goods then their
contracts cannot be honoured,
logistics firms are concerned that the
reliability of SA exporters may be
compromised.
“Business is very bad at the
moment. The recession pays a
major role obviously, because our
utilisation factor comes down. But
what really affects us is strikes.
Transnet seriously affected us. In
May it was really coming to a
standstill for us. Our company has
been seven years in the business and
I’ve never seen anything like this,”
said Kruger.
Reduced use of warehousing has
been one effect of the one-two punch
of strike and recession. “Clients
were keeping goods in storage for up
to three months normally. Now they
don’t store as long as they did. They
bring in and take out immediately.
They are looking at their cash flow
situation,” Kruger said.
“It’s a big part of our business,
warehousing,” he said. Kwela runs a
12 000 m² warehouse in Cape Town
where the firm is headquartered, and
a 4000 m² facility at its Johannesburg
branch office.