Imperial Logistics aims to earn close to 80% of its revenue from outside South Africa, compared with the current 68%, says CEO designate Mohammed Akoojee.
Akoojee will officially take over from current CEO Marius Swanepoel in the first half of 2019.
Imperial Logistics has morphed into a standalone group following the unbundling this year of Imperial Holdings into Motus and Imperial Logistics.
While the automotive-centric Motus will focus largely on the local market, Imperial Logistics, with an already established footprint in the rest of Africa and Europe, has international growth ambitions, with the unbundling allowing these ambitions to take flight.
“Motus and Imperial Logistics operate in completely different industries and geographies and have different strategic priorities,” says Akoojee.
“The big growth opportunities for Imperial Logistics lie outside South Africa. This is a function of our size in the South African market.
“There is nothing we cannot offer a client, not an industry we don’t operate in. Of course we’ll continue to invest in value-addition activities in South Africa, such as e-commerce and innovation, but the big growth will mainly come from our Africa Region business.”
The roughly 14 African markets outside South Africa where Imperial Logistics operates, house the holy grail of consumerism – young emerging market spenders.
Imperial Logistics is active in the pharmaceutical and consumer goods sectors in countries such as Kenya, Nigeria and Ghana.
“We act as the route to market for multinational pharmaceutical and fast-moving consumer goods companies,” says Akoojee. “We play a critical role in getting pharmaceutical and consumer goods to end markets in Africa.”
Imperial Logistics aims to grow the number of African markets in which it operates, and will continue to look especially to opportunities in west and east Africa.
“Organically we can grow this business in Africa in terms of revenue at low double-digits, and then there will also be acquisitions on top of this,” says Akoojee.
In South Africa, the aim is for Imperial Logistics to grow organically at two times gross domestic product (GDP), plus inflation, he adds.
Sea, Air Capabilities
In Europe, and especially in Germany, Imperial Logistics is a specialist in the chemical and automotive markets.
“We have good margins in Europe and we want to expand our capabilities into new geographies,” says Akoojee.
Imperial Logistics International has a new CEO, by the name of Hakan Bicil, who joined the company in September. He is the former chief commercial officer at CEVA Logistics.
Imperial’s international business earns around E1.6-billion in revenue a year.
Imperial Logistics International may not have been “very sales focused” in the past, admits Akoojee.
“When you are a specialised business, tenders tend to come to you and perhaps that makes management complacent.
“Hakan is very sales focused and he believes we can grow the business. We are targeting revenue growth in the Logistics International business at two times GDP plus inflation.”
Imperial Logistics also wants to grow from a third-party logistics (3PL) provider in Europe to a fourth-party logistics provider, by means of acquisitions.
This means the company will add supply chain management and consulting to its skills set. The focus is also on freight management.
“Imperial Logistics is currently the 25th largest 3PL logistics business in the world by revenue,” says Akoojee.
“But if you look at us compared with the tier one players, the top ten, the major difference between us and them is that they all have sea and air capability.
“We don’t have that. We have a strong contract logistics business. So, the question is, how can we also offer our clients freight management solutions, so that we can provide them with a fully integrated solution?”
Akoojee says Imperial Logistics will, most likely, enter the freight management market by doing two or three small acquisitions.
“Our vision for Imperial Logistics is to be a tier one international, integrated logistics provider – certainly better than number 25,” he adds.
A secondary listing abroad may be possible, but only into the future.
“This decision will be driven by value creation,” says Akoojee.