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Big Bet on Flexibility and Differentiated Services

Manuel Díaz - Seko Logistics
Managing Director of Seko Logistics

STORY INLINE POST

Sat, 09/01/2018 - 11:15

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Q: What opportunities did Seko Logistics identified to set up shop in Mexico?
A: Mexico has already developed its most basic logistics offering but it is still not engaging in fourth-generation logistics services. Logistics operators in Mexico offer little flexibility. While some companies engage in transportation processes, they are not interested in other added-value services such as container-filling, subassemblies, relabeling or repackaging. Seko Logistics identified the opportunity that these differentiated services could bring and we decided to step forward and invest in the country. This investment project was possible through US capital provided by Seko Logistics, Mexican capital provided by Grupo Ei and additional funds delivered by the Greenbriar Equity Group.
Q: How does having offices on both sides of the US-Mexico border enable Seko Logistics to improve clients’ logistics operations?
A: The company has a wide global network. Seko Logistics did not arrive in Mexico to tell its clients that it has certifications, an advanced technology or a global network because that is not our true differentiator. Our value proposal is oriented toward flexibility and financing and the adoption of best international practices for logistics services. Seko Logistics has brought in best practices from India, the UK and the US to ensure we are at the forefront in terms of differentiated services.
Q: What is the company’s strategy to compete against large, world-class logistics operators present in Mexico as well as small, local transportation companies?
A: We focus on identifying the intangible opportunities in the market and sticking to niches where we can add value. Rather than competing in segments where global operators are the top contenders, such as basic customs brokerage, air cargo and container transportation, we focus on the integration and supply of flexible logistics solutions. We are against storing goods close to the border, so we use consolidation centers located all over the US to open containers and apply logistics technology to ensure goods arrive straight to production lines. This often means doing subassemblies and full repackaging so components can reach production lines on time. Seko Logistics receives brake discs from India and brake pads from China, for example, and puts them together and delivers them to the client’s production line.
Q: How is Seko Logistics collaborating with automotive suppliers to improve the efficiency of their logistics operations?
A: We engineer logistics solutions based on nontraditional services for automotive suppliers. Seko Logistics is constantly looking for ways to reduce stock, increase cash flow for maquila companies and guarantee solutions against legal risks related to customs processes. These services may not reduce the direct prices we offer to companies but they eventually cut down the global costs of their logistics operations.
Automotive companies generally demand that their logistics operators be highly flexible and have an in-house IMMEX department that supports suppliers that are not interested in setting up shop in Mexico. Clients also want us to focus on eliminating stocks so their distribution centers can be transformed into production lines. By meeting these demands, Seko Logistics has managed to take care of an OEM’s reverse logistics, work with a Tier 1 supplier in brake systems, help another manage various suppliers and collaborate with other companies.
Q: What milestones does Seko Logistics plan to achieve in its first year of operations in Mexico?
A: We plan to open 20 offices in Mexico in our first year. As of June 2018, Seko Logistics had inaugurated six offices in the country. We have identified the areas in Mexico where industries such as automotive, aerospace, steel and electronics are growing the most and our next step is opening offices there. As a newly arrived company, we expect to double our annual revenue every year up to 2023.

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