27
26
Bahri Annual Report
2016 Business Units Performance & Achievements
Bahri Annual Report
2016 Business Units Performance & Achievements
A market consolidation and an increasing number of mergers amongst international players might create a monopoly. However, some of potential players that will emerge will vie based on price, while Bahri will seize the strategic initiative and create value. As the sole national flag carrier, Bahri Logistics is also playing a major role in national development not just as a marine transporter and logistics provider but also an employer of choice for Saudi national talent.
volume of commodities along Bahri’s trade routes, Bahri Logistics smart operations, process management and focused marketing efforts, helped the company to increase its market share on the North America trade route from 29% in 2015 to 42% in 2016. Moreover, Bahri also became a total logistics solutions provider, both in Saudi Arabia and internationally after ramping up its Total Logistics capability to serve the growing needs of its key Saudi clients. Moreover, the ability to provide efficient 3 PL services will also contribute significantly to Bahri’s emerging reputation as a global total logistics solutions provider.
On the national and regional fronts, Bahri Logistics will play an increasingly active role in the kingdom’s Total Logistics capacity initiative, which is inspired by Vision 2030 and aims to capitalize on Saudi Arabia’s strategic location, which can be converted into a logistics bridge. Once realized, it will open more GCC opportunities, whereby Bahri can participate in the region’s infrastructure and development projects. The Saudi total logistics market size is estimated at more than SAR 108 billion and it will provide Bahri Logistics with greater growth opportunities in the region and across the world. In comparison to 2015, 2016 saw Bahri’s concerted efforts reach fruition with the introduction of regular liner service to major European ports with a strong involvement in Total Logistics. This new addition generated incremental revenues of SAR 70.64 million. Bahri has also taken steps to expand its presence in South America with the launch of new ports call at Vera Cruz, Mexico, which is expected to generate revenues in excess of SAR 20 million per annum. Logistics introduced SMART Operations, to improve efficiency and increase cost control. In addition to securing MOU’s with international shipping lines for trans-shipment operations. The combined initiatives generated cost savings in excess of SAR 8.3 million and network utilization gains of 5% during 2016. Although the prevailing global financial situation, which severely impacted trade flows and the Operationally, Bahri
Like other Bahri business units, Bahri Logistics was affected by the challenges of 2016. The containerized and break bulk sectors in general cargo of the major shipping companies were in distress, reporting negative growth from Q1 onwards. However, given Bahri’s unique profile as a true multi-purpose carrier, Bahri Logistics absorbed the full impact of prevailing negative market trends. Bahri’s reputation as a market leader in regional logistics, customer and operational services, contributed to its ability to withstand the challenges of 2016, while the competition felt the full weight of the economic downturn. Bahri’s participation as transportation champions in Saudi Arabia’s infrastructure development projects, helped to keep revenue streams on an even keel. Moreover, Bahri’s strategic geographic location, astride themajor eastern andwestern trade routes, coupled with its ability to effectively deploy its unique state- of-the-art vessels, allowed Bahri to provide its customers with total logistics solutions. In 2016, Bahri Logistics, became the only service provider with profile and ability to provide services to all major industries through its strong network of international offices and agents. Moreover, Bahri is increasing its presence on all continents, through the introduction of the Total Logistics Services, which will allow it to create more synergy within Bahri and to maximize Bahri Logistics ability to expand its market share. This will also help it mitigate the negative effects of the economy’s cyclical downturn that in turn affects global trade.
Bahri Logistics
Powered by FlippingBook