Challenged by a lack of capacity and rising prices, air cargo stakeholders are adapting to the new normal in a bid to keep supply chains operational and economies running.
This is according to industry stakeholders who were participating in a webinar on the state of Africa’s air cargo sector amid the COVID-19 pandemic. The webinar, hosted by Messe Muenchen South Africa, the organisers of air cargo Africa Exhibition and Conference assessed the role and challenges of the air cargo sector as restrictions on movement play havoc with operations at airports, airlines, freight forwarders and supply chains.
With many countries on lockdown or restricting movement, cargo capacity has been slashed, creating a challenge for a sector seeking to fulfil its critical role in transporting essential medical supplies and keep import and export goods moving. Panellists in the webinar said stakeholders had to adapt to the new normal, as restrictions would likely continue for months to come. “The current situation requires agility and innovation,” noted Moderator Reji John of STAT Media Group.
Fitsum Abadi, Managing Director of Ethiopian Cargo & Logistics said the airline had adapted quickly, pivoting to a cargo-only carrier and converting many of its passenger airlines to carry cargo. “I never expected to see cargo reclining on seats, but this is in fact what happened at first. We have now adapted by removing the seats of several passenger aircraft to repurpose them for freight, as well as optimising capacity, making Addis Ababa and Lome key regional hubs, and deploying narrow body aircraft to serve regional routes to meet demand.”
Stakeholders reported an increase of chartered flights carrying repatriated citizens, medical supplies or humanitarian aid, which often arrived with little notice. Due to a lack of capacity, costs on scheduled cargo flights, was challenging for producers of perishables for export – such as flowers.
Fabio Weiss, VP, Head of Air Freight Middle East & Africa at DHL Global Forwarding MEA said stakeholders were working together to adapt to the changed environment. “Capacity has declined, but demand is still there. There has been an imbalance of volumes coming into Africa that allow exports going out, and we need to get the mix right for the necessary yields and revenues. The current situation is not sustainable for anyone in the long term. However, we have been working with airports, airlines and customers to find solutions that work for everyone.”
“We are trying to adapt to the new normal as fast as possible,” said Max Conrady, Senior Vice President Cargo at Fraport AG. “We were used to stable, fixed flight plans, and the changes we are experiencing, with many chartered flights, have demanded flexibility from airports, cargo handlers and supply chains. The many operational issues to be solved have demanded a new type of agility. But we are adapting to the new kind of normal, establishing contingency groups within our community to address congestion,” he said.
Nina Engelbrecht-Malherbe, Senior Specialist Cargo at Airports Company South Africa, noted that airports served as a point of regional integration for people and products to connect to the globe. “Airports play an important role in underpinning the economy, getting products to markets, and bringing in essential supplies. We need to be agile, work together with industry stakeholders, understand customers and demands, and link them to the routes they need. We need to work together to help get people back to work. We need to come together as a community to do the best we can; but it is also important that the authorities keep citizens safe without restricting growth and development.”
“It is an unprecedented situation, which demands innovation and cooperation,” said Suzette Scheepers, CEO of Messe Muenchen South Africa. “Fortunately, as we have seen at air cargo Africa shows, this sector is one that can be agile and cooperative, so we are optimistic stakeholders will be able to work together to get imports and exports back on track and support the timeout distribution of medical supplies and humanitarian aid.”
Meet Riaan Rautenbach Changing the Future of moving Cargo, using Cloud-Based and Machine Learning Technology
Riaan Rautenbach, Founder & CEO at LIVE FR8™ (Source: Riaan Rautenbach)
Riaan Rautenbach is an entrepreneur, founder and CEO of South Africa based tech startup LIVE FR8™. A disruptive game changing cloud based App that gives solutions to existing problems in the transport and logistics industry. In this interview with Alaba Ayinuola, Riaan shares his entrepreneurship journey, challenges, impacts and successes of the App. Excerpts.
Alaba: Could you us briefly tell me about LIVE FR8™ and the problems it’s solving?
Riaan: LIVE FR8™ is a South African start-up that offers Cargo Suppliers and Transporters improved low cost logistics services using Cloud Technology. The App can be used on any Smart Device. Cargo Suppliers add loads and Transporters find loads on the App. Cargo Suppliers and Transporters connect using the Cloud. Cargo Supplier lists the loads by weight, category, source address and destination, on the database. The algorithm helps Transporters to search for specific loads in the specified area, thereby turning empty loads into full loads. The Transporter nominates the price to move the cargo to the destination. The Transporter only pays a small fee to LIVE FR8™ once a load has been obtained successfully. The Supplier and the Transporter transact directly with one another, and rate each other. The continuous rating system will remove dishonest, corrupt, non-performing and non-competitive role players. Transparency will drive improved performance and cost effective logistics operations.
Alaba: Why did you start your business?
Riaan: After 30 years’ hard work and experience in transportation of goods by road, sourcing return loads, making deliveries on time, determining whereabouts of Cargo in transit in 5 African countries, I came up with this idea. With my experience in cost accounting, as a marketing manager, financial manager and general manager, I have identified problems in the transport industry. I have spent a lot of time thinking of and finding a solution. I developed an App that addresses the various problems and challenges in the Transport industry: improved communication; finding Cargo geographically in real-time; monitoring and managing dispatch staff, controllers, drivers and Cargo in transit. Reducing communication costs; no expensive programs; no costly servers; no monthly fees; no broker fees; no bidding platform but a closed quotation system. Reducing empty trip costs that results in expensive transport rates, reducing transport pollution and a rating system indicating the performance of Cargo Suppliers and Transporters.
Alaba: What has been the impact of leveraging technology in running your business?
Riaan: The business runs remotely, from any location with internet access. The business model has immense scalability and flexibility. Within 7 months, the App was active in 57 countries. Overhead costs are drastically reduced due to the technology LIVE FR8 App utilises, with no offices or expensive servers required. Technology is the future and using disruptive fourth industrial revolution technology which is Cloud-native and functional is exciting and will lead to transformation of the transport industry.
Alaba: What is one of the biggest lessons you have learnt on your business journey?
Riaan: We have learnt that our product, as a world first “Cloud Technology” App for Logistics is more difficult than expected to market in an existing resistant market. Training is an essential part of our marketing.
Alaba: Kindly share of the impact and success of the App?
Riaan: LIVE FR8™ empowers entrepreneurs in Africa and is available in 19 African countries. It levels the playing field for smaller Transporters anywhere in Africa, lowers operational costs for established businesses and empowers them to compete on equal footing. It transforms anyone with access to an electronic device, into a logistics manager. The App brings a huge competitive advantage to everyone who uses the App. It also empowers isolated communities in Africa to put food on the table by coordinating their logistics on their mobile phones. Though there have been many challenges I believe we will soon make a breakthrough in the market and more people will comprehend how much they can benefit from using the App to improve logistics processes, reduce costs, increase vehicle utilisation and drastically reduce pollution from carbon emissions.
Alaba: What’s the future for LIVE FR8 in terms of its expansion to other African and International markets?
Riaan: Africa: LIVE FR8 will be available in all African countries by July 2021. LIVE FR8 is currently available in 19 African countries: Angola, Botswana, Burundi, Democratic Republic of Congo, Eswatini, Kenya, Lesotho, Madagascar, Malawi, Mauritius (Including Reunion), Mozambique, Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda, Zambia and Zimbabwe.
International; LIVE FR8 is available in the following countries outside Africa; America, Australia, All European Union countries, India, New Zealand, Pakistan, Turkey, Canada, The United Kingdom.
Alaba: Could you share your thoughts on the current state of Logistics in Africa, and where you see it in five years?
Riaan: Logistics face many challenges in Africa such as: Inadequate communication; Border congestions; inadequate road and rail infrastructure; old technologies; trade relations between countries. In five years most of the above, I believe, will be improved by Africa. I am positive, because there are already projects, led by African governments, authorities, entrepreneurs and private sectors to improve all of the above mentioned challenges. LIVE FR8 can play a vital role with its low cost communication between Cargo Suppliers and Transporters. Loads are exposed for free to Transporters, and Transporters can find loads with a geographic search using little data.
Alaba: How can South Africa support small businesses now and beyond?
Riaan: Smaller businesses help to create and sustain jobs. Support is vital to help businesses gain revenue and stay operational. Small-business owners value relationships they have with their customers and need the support of local consumers. As it may be more of a challenge for small businesses to stay relevant, they continuously need to work on adding new products/developing their products and providing new benefits for their customers. This is good as it generates healthy competition with their larger competitors. Small businesses tend to be more innovative as they constantly need to find new ways to sell goods and service. By supporting small businesses you are also supporting your local community to stimulate the economy.
Alaba: Any advice for young African entrepreneurs in tech and logistics?
Riaan: All young African entrepreneurs must believe in themselves and never give up. You can find solutions, keep asking questions about current affairs, search and find answers on how current affairs can be improved. Believe in Africa with all its valuable resources. All economic activities can be improved by young entrepreneurs who seek and find solutions using technology to improve supply chains, transport, more efficient low cost ways of communication and moving goods to people, factories, markets and harbours for export. Africa is the future!
B I O G R A P H Y
Riaan Rautenbach started working as a clerk, then became a learner coder, thereafter I was an Accountant. I then started part time studies at Unisa while working. I was later promoted to Financial Manager and for 4 years I was a Sales and Marketing Manager. I worked as a General Manager in Maize and Wheat Mills and a Poly woven bag factory. I lived and worked in five African Countries: Botswana, Nigeria, South Africa, Swaziland and Zambia. I traded with Angola, DRC, Zimbabwe, Mozambique and Malawi.
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Digitalization in logistics – A user’s experience
Geraldine Mamburu, Founder & MD PDQ Logistics (Source: Geraldine Mamburu)
In some cultures, children are sometimes named after events that would have taken place close to or during their birth. Jokes around naming children Quarantine Buthelezi, Social-distance Moyo, or Pandemic Ndlovu, were circulating in 2020 and made for a good laugh, however, one couple in India took this a little too seriously and named their twin boy and girl, Corona and Covid.
Looking back, I do not recall ever coming across a proposal to name children after any of the variations around the word digital, after all, every second Point of View that was being released was around digitalization and digital transformation. It got me thinking, and realised that a lot of these terminologies are thrown about in the corporate space, but what does this actually mean to the end-user? How does the user interact, make use of, and appreciate digitalization?
Being in the logistics space has found me interacting with a lot more digital platforms over and above e-commerce, social media, and the all-so-dreaded-virtual-meeting platforms. My favourite most convenient app (which is currently the best thing ever since sliced bread in my books) has got to be Truck Fuel Net (TFN). TFN offers a cloud-based, real-time software management solution that helps me manage all my on-road refuelling and driver spend needs. Given that the bulk of operational costs in road freight is fuel, one must have their finger on the pulse and be on the constant lookout for the best price, over and above monitoring driver efficiency. The TFN Management system helps me decide, where, when, and how much the driver can refuel.
Sidebar – I’ve been driving a Ford Kuga 1.6 AWD for a few years (NB: No fire starter jokes allowed) and for such a small engine, that car can chow fuel – I’m talking 11 – 12km/100! I never used to fill up because it was painful watching all that money go down the drain. When I filled up the truck for the first-time round, let’s just say I needed to sit down because I felt a little dizzy.
Every day, we transport goods worth millions of Rands. It goes without saying that the safety and security of the driver, the goods we carry, as well as the trucks themselves, is of paramount importance. TFN’s solutions enable us to run a cashless operation. In the road freight sector, cargo, equipment, and increasingly drivers, are all targets for criminals and if we can take one incentive out of the equation, the better off we are.
Whilst on cashless operations, I would like to give SANRAL a standing ovation. Now, now, before your eyes roll all the way to the back of your head, let me just say that we might have qualms as “Gautengers” about how they went about the e-toll saga, but their app is such a lifesaver! With an e-tag fitted on the vehicle, I can manage my account quickly and securely. The app works in real-time, allowing me to be kept informed of my spend on vehicles. And lo and behold when I do forget to top up (because …you know …admin), I immediately get a notification the moment my funds are depleted, allowing me to top up immediately whilst the truck is still on route, contributing to a seamless operation. Well done SANRAL. Sometimes the government does get it right …sometimes.
The South African logistics sector contributes about 12% towards the GDP, according to Stellenbosch University and the World Bank. Of that percentage, approximately ¾ is attributed to road freight alone. With such modestly generous figures, it’s encouraging to see various organisations come up with digitally inspired solutions to cater to this industry.
This brings me to my most used platforms, Car Track and Tracker. I can only assume that before the advancement in technology, one must have had to have a great deal of faith, composure, and trust. Not to say that we no longer require these skills, but the ability to log onto these apps and be able to get real-time updates on the exact location of a customer’s goods in transit certainly prevents a blood vessel or two from popping (in the event that you cannot reach the driver.) As for Google Maps, it goes without saying, that this is the backbone of my interaction with these tracking platforms.
There are a bunch of other digital platforms such as Linebooker that I am still to explore as the business continues to grow. However, it’s been interesting to know that before we start thinking self-driven trucks (think of that one scene from Terminator, were the machine is operating the truck…but I digress) and other seemingly complex technological advancements aimed at this industry, there are still digital channels that make the day to day operations in logistics that much easier.
What other digital platforms are you using or have you heard off that have made a world of a difference in the logistics space?
Article by: Geraldine Mamburu, Founder & MD PDQ Logistics
Air cargo, logistics crucial in mitigating pandemic impacts
Stakeholders urge collaboration, technology to keep essential goods supply chains moving
The COVID-19 pandemic and global lockdowns have challenged Africa’s air cargo and logistics stakeholders in recent weeks, but through collaboration, agility and the use of digital technologies, they are ably delivering on their mandate to supply critical goods.
This is according to industry players who participated in a webinar hosted by Logistics Update Africa, partners of air cargo Africa, the sector’s leading industry exhibition and conference, on how last-mile delivery services can keep up with Covid-19 demand for critical medical and food shipments.
Speakers from airports authorities, logistics solutions providers and e-commerce companies in Kenya, Nigeria and South Africa noted that adapting to the new realities of closed air lanes and new logistics restrictions had demanded agility and collaboration. However, the same collaboration and agility would serve the industry well when normalcy returns, they said.
With passenger flights grounded and only limited cargo flights landing, airports authorities in South Africa and Kenya said they were seeing a dramatic drop in activity at airports.
Nina Engelbrecht-Malherbe, Senior Specialist – Cargo at Airports Company South Africa, said traffic at OR Tambo international airport had dropped from around 650 movements per day to around 30 – 40 per day. “What’s keeping us busy is the essentials, and we are even seeing passenger aircraft now transporting essential goods in and out of airports, so the cargo precincts are still abuzz.”
Jacob Bwana, Commercial Manager – Cargo at the Kenya Airports Authority, said the pandemic had illustrated that air cargo and its associated logistics network was critical for both commercial and humanitarian purposes. “A key lesson in this time has been the need for solid business continuity plans to mitigate risk and support stakeholders,” he said. On the question of increasing costs, he noted: “Scarcity creates increasing prices, and increases the risk of spoilage, so this is unavoidable. However, we hope to see demand and supply coming back to equilibrium when we return to normalcy. A crisis is not a time to compete, but to collaborate to save lives.”
With reports indicating that air cargo capacity remains 35% lower than last year across all trade lanes around the world, global stakeholders and industry bodies have also emphasized the need for industry collaboration and communication. The International Air Cargo Association (TIACA) has urged the air cargo industry to collaborate to keep fueling trade and ensuring the supply of critical goods, while the International Air Transport Association (Iata) has called for greater coordination between governments to ensure that air freight can continue to flow.
Overcoming last mile challenges
While fewer flights mean the potential for increased efficiency in offloading and distribution of goods, lockdowns and restriction of movement have created bottlenecks and challenges for road freight and last mile players, the speakers said. Among these challenges were compliance with new regulations that restrict movement across borders or during certain hours of the day. However, close collaboration and consultation with governments and value chains had helped to overcome last mile challenges.
Kagure Wamunyu, Chief Strategy Officer at Kobo360, said digital collaboration via Kobo360’s aggregation platform had enabled logistics services to maximize capacity and avoid delays that could have increased costs and slowed the delivery of essential goods. “For example, truck drivers could be required to go into quarantine for 14 days when crossing a border, so by sharing information and working together, companies can arrange for a local driver to take over at the border, to avoid the delay.”
Tolulope George-Yanwah, Country Manager – Nigeria at Jumia Services, said the current crisis was underlining the critical role e-commerce plays, and logistics has been its enabler. “Technologies offer a solution in times like these. As a tech-enabled company, the biggest changes for us have been the need to introduce contactless delivery and enhance precautionary measures. But because we already had the capacity to scale up for special promotional events, we are able to meet growing demand for essential goods. The lesson for everyone is the need to be flexible and react quickly to new situations.”
Suzette Scheepers, CEO of Messe Muenchen South Africa, organisers of air cargo Africa, says supply chains are more important than ever before. “We’re seeing just how important air cargo and the entire logistics chain is, as we strive to take essential medical supplies and food to countries battling the COVID-19 pandemic. They will be increasingly important in bolstering fragile economies in the months to come. We agree that collaboration and communication, as well as harnessing the most advanced models and technologies, will help the sector manage costs and improve efficiencies to keep it sustainable through this difficult time.”
air cargo Africa, to be staged in Johannesburg from February 9 – 11, 2021, will bring together industry stakeholders from across the value chain to discuss the challenges, solutions and opportunities in a fast changing market.
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