Mohammed Al-Bayati, CEO, NAQEL Express • Interview

NAQEL currently operates across the entire logistics value chain in Saudi Arabia, from freight forwarding and port handling to customs clearance, road transportation, warehousing, and finalmile distribution.

Could you tell us about your company’s philosophy?

Our philosophy is all about delivering end-to-end, one-stop logistics services for our customers in Saudi Arabia and rest of the Middle East. This is accomplished through our three divisions—express, e-commerce, and logistics solutions. We started in 1993, adopted the name NAQEL in 2005, and established ourselves as the leading domestic express logistics company offering door-to-door delivery of shipments greater than 30kg. After receiving courier license in Saudi Arabia in 2014, we established our e-commerce division offering home delivery services for online retail companies around the world for shipments less than 30kg. Following that, we started to expand in GCC countries and received licenses to operate in neighboring countries. In addition to China, the UK, and the US, we now have licenses for Bahrain, the UAE, Egypt, and Jordan. We are working on getting licenses for other GCC countries as well. We are witnessing a market trend where customers are switching toward online shopping to fulfill their needs as opposed to visiting physical retail stores. Our e-commerce division has reflected significantly higher than the market growth of around 25%. In 2018, we established the logistics solutions division offering industry specific solutions, including warehousing and 3PL services. NAQEL is currently operating across the entire logistics value chain, from freight forwarding and port handling to customs clearance, road transportation, warehousing, and final-mile distribution. Our philosophy revolves around the CARE principal: we focus on competent, accountable, respectable, and engaged employees delivering logistics with care for our valued customers. When it comes to competence, we have a training center here. We had start a program called future leaders program around six years ago. It originally focused on hiring engineers and trying to develop them as logistics managers. Currently, we have more than 120 engineers across the country. We spend almost 3% of our revenue in training and developing our employees.

Do you plan on expanding more internationally, and how do you plan to strengthen your presence as the Saudi government puts more weight into logistics?

After we received the courier license in 2014, we set up a full-fledged gateway and bonded clearance facilities at Dammam airport in 2015. We opened a new gateway at Riyadh Airport in 2019 and a similar gateway facility was set up in Jeddah airport in 2020. These are part of our expansion efforts. From our gateway, we can re-export to other countries and quickly clear goods into Saudi Arabia. The Saudi Industrial Development Fund is also supporting by giving loans to logistics companies to start building desired logistics facilities and meet the ongoing logistics needs of the Kingdom. We are strengthening our market leadership in the Middle East while connecting Asia, Europe, and Africa in line with the government’s Vision 2030 imperatives. We aim to further strengthen our logistics footprint in these continents.

How do you integrate new technological developments and operate on the big data front?

This is one of the areas we are putting in great effort. For example, we are trying to implement data-driven decision making in delivery route planning and optimization, which can improve our driver efficiency by as much as 30-40%. When it comes to the last mile, we have more than 1,000 drivers operating in this area, and a 30% increase in efficiency is equivalent to the salary of nearly 300 drivers. We are using AI technology that has been partially developed in-house and outside of NAQEL. We can take into account all the relevant factors and come to an optimal delivery solution. 70% of our e-commerce market is cash-on-delivery, and in this area there is a high return percentage because the customer still has the opportunity to change his or her mind. We are leveraging on our customer data to analyze their behavior and implement interactive solutions that will further improve our overall service offering.