Marine­trans, a ship spare parts for­warder with its head­quar­ters in Sin­ga­pore, is thriv­ing de­spite tough times in the in­dus­try.

The lo­gis­tics in­dus­try is strug­gling since the 2008 global eco­nomic re­ces­sion. But once in a while you en­counter a com­pany that is thriv­ing in a dif­fi­cult en­vi­ron­ment.

Norway-Asia Business Review - - Contents - ANRIKE VISSER

Marine­trans, a ship spare parts for­warder with its head­quar­ters in Sin­ga­pore, seems to be one of them.

Ac­cord­ing to CEO, Mr Jør­gen Fausko, and Global Sales Di­rec­tor, Mr Steven Fors­berg, Marine­trans has seen an av­er­age of 15% growth dur­ing the last ten years. The com­pany was founded in 1991 by Mr Fausko. Now it has 150 em­ploy­ees all over the globe in its of­fices in amongst oth­ers Nor­way, Ja­pan, USA, the Nether­lands, South Korea and Ger­many.

Later this year, Marine­trans will open an­other of­fice in Mum­bai, In­dia. Lo­ca­tions in Shang­hai and Taipei are fur­ther down the road. Ac­cord­ing to Mr Fors­berg, be­ing close to clients is one rea­son for their suc­cess over the last decade. Meet­ing clients face-to­face has proven time and time again to be es­sen­tial for land­ing new clients and China is an ex­pected growth area.

Hav­ing peo­ple on the ground close to clients is im­por­tant, but in the ports as well. “Free and in­de­pen­dent group of af­fil­i­ates with ex­per­tise within the marine in­dus­try. Our part­ners have been hand-picked and trained ac­cord­ing to Marine­trans qual­ity rou­tines and pro­ce­dures. Presently we have 22 spe­cific ware­houses lo­cated in strate­gic lo­ca­tions. In ad­di­tion to our 22 sta­tions, Marine­trans also has work­ing part­ners in over 2,000 ports world-wide for ar­rang­ing cus­tom clear­ance and de­liv­ery to ves­sel.”

An­other ex­pla­na­tion for the suc­cess of Marine­trans is their IT-sys­tem, Mr Fausko con­tin­ues. While we con­sider track­ing to be the norm when we or­der pri­vate goods on­line, it is in­no­va­tive in the global freight sec­tor. The sys­tem, which is sim­i­lar to that of DHL, con­sists of a bar­code which can be scanned in the dif­fer­ent hubs. The client is in­te­grated in the IT-sys­tem of Marine­trans and sees right away where the pack­age is.

This is fur­ther ex­plained on the web­site of Marine­trans: “All spares ar­riv­ing at any of our ter­mi­nals are marked with ves­sel name, bar coded, re-packed if re­quired and of course, re­ported to owner as on hand by means of a stock list. Clients ob­tain a web site pass­word for view­ing stock at will 24/7. Mark­ing and pack­ing ser­vices are free of charge un­less ac­tual out­lay to pur­chase ma­te­rial.”

An­other el­e­ment of the track­ing sys­tem is the network of dis­tri­bu­tion hubs. In cen­tral lo­cated hubs, for ex­am­ple Am­s­ter­dam for Europe, the parts are col­lected be­fore they are sent to the client. Twice a week, parts from all over Europe are sent to Am­s­ter­dam await­ing a buyer. The col­lec­tive trans­port is cheaper than in­di­vid­ual trans­port of one part and

it saves time, since the parts are al­ready in a cen­tral lo­ca­tion, Mr Fausko ex­plains. “The main rea­son for our suc­cess last years is due to the lever­age we have on high par­cel vol­ume and the cost ben­e­fit all clients have when we con­sol­i­date all the ship­ment from all dif­fer­ent clients to cus­tom-clear and de­liver on-board.”

Stay­ing on top of their game is im­por­tant for Marine­trans, so the com­pany fol­lows tech­no­log­i­cal de­vel­op­ments closely. This means that Marine­trans is con­stantly mon­i­tor­ing the markets for new tech­nolo­gies to im­ple­ment in their ser­vice. It also looks for tech­nolo­gies that might dis­rupt the in­dus­try at its core.

An ex­am­ple com­ing to mind is 3D print­ing. In the fu­ture ev­ery ves­sel could have a 3D printer on board to make a part when­ever needed. But it will take a long time be­fore that’s pos­si­ble or cost ef­fec­tive. A ves­sel has more than 3,000 dif­fer­ent parts. To be able to print all of them in the dif­fer­ent ma­te­ri­als re­quired is costly, let alone the weight and space it takes to trans­port all the ma­te­ri­als.

A much more fea­si­ble op­tion is 3D print­ing in main dis­tri­bu­tion hubs; a ser­vice Marine­trans is cer­tainly con­sid­er­ing for the fu­ture. This will elim­i­nate trans­porta­tion costs for the client com­pletely. An­other pos­si­ble ser­vice based on a tech­no­log­i­cal innovation, is the de­liv­ery of pack­ages on board a ship by drones. Mr Fors­berg ex­plains: “We are in essence an IT com­pany. We for­ward parts in the most ef­fi­cient and cost ef­fec­tive way pos­si­ble us­ing IT. We don’t own the ves­sels used for the trans­port.”

This mind­set might be the rea­son un­der­ly­ing all other rea­sons for the year over year growth of Marine­trans when other com­pa­nies is the marine in­dus­try are strug­gling to re­main afloat. Moody’s re­cent re­port ‘Out­look Up­date: Ship­ping - Global, Sta­ble Out­look Re­flects Eas­ing of Dry Bulk, Con­tain­er­ship Ex­cess Ca­pac­ity; Flat EBITDA (Earn­ings Be­fore In­ter­est, Taxes, De­pre­ci­a­tion, and Amor­ti­sa­tion)’ men­tions the low prices in the mar­ket at the mo­ment.

“Moody’s Ja­pan K.K. says that the out­look for the global ship­ping in­dus­try is sta­ble, given that -- af­ter ex­clud­ing M&As and spinoffs -- the ag­gre­gate EBITDA of rated ship­ping com­pa­nies will re­main at sim­i­lar lev­els in 2017 as last year. Un­like 2016, when the in­dus­try saw dou­ble-digit EBITDA de­clines, the op­er­at­ing en­vi­ron­ment has bot­tomed and earn­ings will re­main sta­ble, although at a low level dur­ing 2017.”

The last years saw a flood of bank­rupt­cies, con­sol­i­da­tions and ac­qui­si­tions in the mar­itime sec­tor. One of the lat­est bank­rupt­cies in Sin­ga­pore was Ezra just a cou­ple of months ago in March, 2017. CIMB an­a­lyst Lim Siew Khee ex­pressed to Reuters the ex­pec­ta­tion that one to two more firms will de­fault on debt in the next two years in Sin­ga­pore.

Last year, South Korean Han­jin al­ready filed for bank­ruptcy. This event was com­pared by Ms Shereen Zarkani, Head of Reefer Man­age­ment at Maersk, to the fall of the Lehman Broth­ers in 2008 in an in­ter­view with Fresh Plaza. “It was a wake-up call for the in­dus­try. The dan­ger is al­ways there, but we did not see some­thing like that hap­pen in the past. In the last few years, we saw that ca­pac­ity was greater than the de­mand,” ac­cord­ing to Ms Zarkani to Fresh Plaza.

Now Maersk Line is in the process of ac­quir­ing Ham­burg Süd for which it will pay EUR 3.7 bil­lion ( USD 4 bil­lion) ac­cord­ing to Reuters. “We want to in­crease the scale in or­der to re­duce costs and pro­vide bet­ter ser­vices to our cus­tomers,” ex­plains Ms Zarkani.

Although Marine­trans’ clients are the ship­ping com­pa­nies, ship parts are es­sen­tial and Marine­trans has not ex­pe­ri­enced the dif­fi­culty felt by the rest of the sec­tor. Af­ter more than 26 years of suc­cess­ful op­er­a­tions, it is time to give back to the peo­ple that made their suc­cess hap­pen, states Mr Fausko.

“Many of our em­ploy­ees are from the Philip­pines, so we want to give back to them. We are build­ing a 2-story feed­ing cen­tre and au­di­to­rium for Da­gatan Ele­men­tary School in Lipa City, Philip­pines. 30% of the chil­dren at that school are mal­nour­ished, and we will now be able to feed them break­fast/ lunch and din­ner for the chil­dren and their fam­i­lies.”

“This is the first big so­cial project that we do di­rectly. We have no plans for new projects, as we need to fin­ish this one first as see how it goes. Af­ter the feed­ing cen­tre is fin­ished we will still con­tinue to sup­port the school with food to the chil­dren and their fam­i­lies, so it will be an on­go­ing project for years to come.” The feed­ing cen­tre is ex­pected to be op­er­a­tional at the end of this year.

PHOTO: DHUTTERSTOCK

PHOTO: ANRIKE VISSER

Caption: Above Left, Sin­ga­pore bustling con­tainer har­bour. Above: Marine­trans’ CEO, Mr Jør­gen Fausko in his of­fice in Sin­ga­pore over­look­ing the busy har­bour

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