Transport and logistics looks to be a fairly grim market to be involved in at the moment.
Last month, one of the world’s biggest shipping lines, Maersk, reported an 84 per cent decline in profits with its chief executive Nils Anderson stating that conditions were worse than after the 2008 financial crisis as a drop in trade from China has slowed growth, causing rates charged by the industry to plummet.
At the other end of the chain, smaller family-owned firms are also feeling the pinch, but Dubai’s Al Sharqi Shipping believes that tough markets such as this are the best time in which to make investments in its business.
“We have always bought the most number of trucks when the recession is here. In 2009, when the whole market was going down, we were buying trucks because prices were cheaper,” says the general manager Kashif Rafiq, 31.
Al Sharqi Shipping was started by Kashif’s father, 66 year-old Muhammed Rafiq, in 1989. He arrived in the UAE in 1974 and worked for a rival firm until 1989 when a recession hit and he lost his job.
Al Sharqi was borne out of necessity, says Kashif’s brother, Atif Rafiq, 30, who is the company’s business development director.
“He had two options when he was let go from his old job – either go back to his hometown or to stay in the country and set up on his own,” says Atif.
The company has survived several recessions since, and is still making investments in tough times.
“Even right now, we are investing in IT infrastructure,” says Kashif.
He is overseeing the installation of a new, US$60,000 enterprise resource planning (ERP) software system from the US-based Netsuite, which the company plans to use as part of an ongoing drive to digitise most of its activities and provide customers with real-time information over deliveries.
“The whole industry is changing,” says Atif.
For instance, the company equips all of its drivers with a tablet and a printer.
“These are not educated people - they don’t really know how to operate a smartphone,” says Atif. “But we found out that once you trusted them and gave them certain privileges, you could give them a tablet and they started working from it,” he adds.
These are used for a range of tasks from producing delivery notes and securing signatures to dealing with problems over deliveries or vehicles.
“They use Google Talk and WhatsApp. Any issue they have on the container, they can immediately take a picture and send it to us. We don’t need to send a guy all the way over to inspect,” says Atif.
“If a lorry breaks down, they can show the problem over Skype or on WhatsApp. We have a mechanic who can see what is happening and can troubleshoot on the spot.”
The company has grown from a handful of clients for whom Muhammed used to work at the old Deira port into a company with offices in Dubai, Sharjah, Faisalabad, Karachi and Dar es Salaam.
“From a small office in Deira with one chair and a secretary, we are now in three countries with five offices and a workforce of 100-plus,” says Atif. “We have about 50 [staff] in the UAE, 22-25 in Tanzania and about 30 in Pakistan.”
The pair declined to give sales figures for the business, but say that the company had to double in size each year from 2010-14, before consolidating in 2015, when turnover was flat. Its recent growth meant it has made the SME100 – a biennial ranking of Dubai’s fast-growing companies organised by the Government’s Department of Economic Development – at number 83.
Three younger brothers, Asif, 25, Wasif, 24, and Sadaf, 22, also work at the firm and are at various points in the completion of a two-year rotational training programme aimed at ensuring they completely understand the business.
Kashif says that he believes the company’s investment in technology will help it to bridge the gap between it and some of the industry giants. “If we are able to take technology, and give a service that is equal to one of the big logistics companies like Kuehne & Nagel or Ceva Logistics, does size matter really? It’s all web-based now.
“If you are able to lock in and see exactly where your shipment is, you’re going to know this is something you can trust.”
The company also believes there are further opportunities in Africa. Kashif says that although the continent throws up challenges, many of these are issues it faced in the GCC years ago. “Africa is all about manual paperwork and is tribal – it’s about who you know. We still know how to deal with it.”
Moreover, despite the slump in freight rates, the volume of goods being shipped to Africa is expected to increase, partly through major investments in ports and roads infrastructure, but also because GDP growth is expected to continue across most of the continent. The IMF is predicting growth above 5 per cent for sub-Saharan Africa in 2016, and a recent Knight Frank report stated that of the 20 countries expected to be the fastest-growing in the world over the next five years, 13 are in Africa.
Trade volumes between Africa and markets such as Russia and China have also helped the DP World, Dubai’s ports operator, to maintain traffic growth in 2015.
DP World reported an increase in volumes of 3 per cent last year, or 2.4 per cent on a like-for-like basis. Speaking at the recent CIS Global Business Forum in Dubai, DP World’s deputy chairman, Jamal Majid bin Thaniah, said growth in global shipping volumes was more likely to come from new north-south routes than trans-Pacific or Europe-Asia traffic.
“In my own opinion, the [opportunities] will only come with the North-South. East-West is saturated,” said Mr bin Thaniah.
“When it comes to cargo, either by shipping lines or air freight, Dubai will play a major role in connecting African countries with the CIS, the Russians, the Chinese etc.”
mfahy@thenational.ae
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PAKISTAN v SRI LANKA
Twenty20 International series
Thu Oct 26, 1st T20I, Abu Dhabi
Fri Oct 27, 2nd T20I, Abu Dhabi
Sun Oct 29, 3rd T20I, Lahore
Tickets are available at www.q-tickets.com
The biog
Hometown: Cairo
Age: 37
Favourite TV series: The Handmaid’s Tale, Black Mirror
Favourite anime series: Death Note, One Piece and Hellsing
Favourite book: Designing Brand Identity, Fifth Edition
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BIGGEST CYBER SECURITY INCIDENTS IN RECENT TIMES
SolarWinds supply chain attack: Came to light in December 2020 but had taken root for several months, compromising major tech companies, governments and its entities
Microsoft Exchange server exploitation: March 2021; attackers used a vulnerability to steal emails
Kaseya attack: July 2021; ransomware hit perpetrated REvil, resulting in severe downtime for more than 1,000 companies
Log4j breach: December 2021; attackers exploited the Java-written code to inflitrate businesses and governments
UAE currency: the story behind the money in your pockets
The Dictionary of Animal Languages
Heidi Sopinka
Scribe
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
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Killing of Qassem Suleimani
CREW
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More coverage from the Future Forum
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
'Munich: The Edge of War'
Director: Christian Schwochow
Starring: George MacKay, Jannis Niewohner, Jeremy Irons
Rating: 3/5
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ONCE UPON A TIME IN GAZA
Starring: Nader Abd Alhay, Majd Eid, Ramzi Maqdisi
Directors: Tarzan and Arab Nasser
Rating: 4.5/5
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THE SPECS
Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
Torque: 780Nm
Transmission: 8-speed automatic
Price: From Dh1,350,000
On sale: Available for preorder now
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Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Moon Music
Artist: Coldplay
Label: Parlophone/Atlantic
Number of tracks: 10
Rating: 3/5
Infiniti QX80 specs
Engine: twin-turbocharged 3.5-liter V6
Power: 450hp
Torque: 700Nm
Price: From Dh450,000, Autograph model from Dh510,000
Available: Now
In-demand jobs and monthly salaries
- Technology expert in robotics and automation: Dh20,000 to Dh40,000
- Energy engineer: Dh25,000 to Dh30,000
- Production engineer: Dh30,000 to Dh40,000
- Data-driven supply chain management professional: Dh30,000 to Dh50,000
- HR leader: Dh40,000 to Dh60,000
- Engineering leader: Dh30,000 to Dh55,000
- Project manager: Dh55,000 to Dh65,000
- Senior reservoir engineer: Dh40,000 to Dh55,000
- Senior drilling engineer: Dh38,000 to Dh46,000
- Senior process engineer: Dh28,000 to Dh38,000
- Senior maintenance engineer: Dh22,000 to Dh34,000
- Field engineer: Dh6,500 to Dh7,500
- Field supervisor: Dh9,000 to Dh12,000
- Field operator: Dh5,000 to Dh7,000