STORY INLINE POST
Q: How does Abu Logistics assist customers in streamlining and enhancing the efficiency of their logistics operations?
A: We started as a freight forwarder for the automotive sector. In the early years, our primary focus was expediting urgent cargo, catering mainly to Tier 1 clients. Our core mission revolved around addressing production line pauses, which instilled a sense of urgency in us as we consistently strove to find solutions. We explore various options to accommodate the client's urgency, ensuring timely delivery without disrupting the supply chain for them and their customers.
Q: What are the primary obstacles you encounter when striving to meet the demands of next-day and express logistics services?
A: Insecurity is a significant problem when collecting or delivering cargo in Mexico. We are often unable to travel on certain roads during late nights or early mornings due to security concerns, both for our operators and the cargo itself. Customs are also quite complex, especially when transporting cargo from various parts of the world. We must adhere to the regulations of each country, both at the origin and destination. Many countries require export clearance but the process can take 24, 48 or even 72 hours. Consequently, clients may request us to skip the formal clearance process, opting to pay the VAT (value added tax) However, some countries do not allow this, which can pose challenges in transportation. It is crucial to have an in-depth understanding of the customs regulations of each country before proposing any cargo transportation solution.
Q: With the persistent shortage of truck drivers, what steps has Abu Logistics taken to attract and retain talent in this crucial area?
A: We typically operate on a "just-in-time" basis, meaning that some clients send us shipments with little advance notice, often requiring immediate pickup and delivery. While we have some clients with whom we have established fixed-rate contracts and monthly scheduling, our primary focus is ensuring timely and reliable delivery, especially for critical shipments that need to be picked up within hours. Our approach involves meticulous planning, maintaining 24/7 visibility on shipment status and coordinating various aspects of the transport process. This includes scheduling exports from our transfer facility based on arrival times, handling cross-border documentation, planning trans-shipment in the US and coordinating with US drivers. This attention to detail is essential, as many trucking companies at the border could leave shipments stranded for several days due to a lack of availability, leading to client dissatisfaction.
Q: What opportunities do you envision for Abu Logistics to expand your air cargo services at the Felipe Ángeles International Airport (AIFA)?
A: We primarily specialize in hand carrier services rather than palletized cargo. Hand carrier services use commercial passenger flights, which operate at a significantly higher frequency. Passenger flights predominantly arrive at Mexico City International Airport (AICM) rather than AIFA. We are observing considerable delays with airlines that have transitioned to AIFA, primarily due to the need for more infrastructure for efficient cargo handling and the operational inefficiencies among the many customs agencies operating there. In response to these challenges, our solution involves routing through Toluca International Airport.
Q: With nearshoring a rising trend, what strategic initiatives has Abu Logistics developed to address this change and provide efficient solutions to its customers?
A: We have spent a significant amount of time exclusively handling cargo between Mexico, the US and Canada, which has led to our strong expertise in North America. Due to increasing client demand, we expanded our services to include intra-Mexico transportation. There is a considerable need for urgent shipments between plants within the same country and port hauls. This expansion presented a significant opportunity, especially during the pandemic when global supply chains began to falter. The shortage of components and the urgent need for these items to reach their destinations quickly prompted us to broaden our air service offerings.
At the end of 2022, we ventured into providing maritime services. We have always believed in accommodating our clients’ needs and preferences. This willingness to adapt and innovate has driven us to develop various solutions. About six years ago, we developed a platform that provides our clients with access to comprehensive information, including documents, status updates and reports. We are continually expanding our network of suppliers and we are highly selective when choosing partners, focusing on certifications, visibility and accuracy of information. This enables us to offer our clients timely solutions.
While we have attempted diversification, about 95% of our clients belong to the automotive sector. We are closely aligned with their just-in-time manufacturing practices. Our company will celebrate its ninth anniversary in October and we are proud to hold seven years of ISO 9001:2015 certifications. From the beginning, continuous improvement, process refinement and quality management have been ingrained in our company culture. We prioritize processes, quality and excellence in service delivery.
Q: How does Abu Logistics address unexpected challenges, such as a strong Mexican peso or adverse weather conditions?
A: Our primary goal is always to be proactive, go the extra mile, discuss potential challenges with the client and devise solutions. A pivotal aspect of our ISO compliance revolves around risk analysis. We consistently monitor weather conditions, such as the likelihood of heavy snowfalls, hurricanes or tropical storms. We communicate this information to the client in advance, conducting assessments of air routes and scrutinizing flight cancellations. We assess the prevailing weather conditions before making any decisions so that the client is aware of potential delays arising from these problems.
There are also political considerations. Certain routes may be suspended due to geopolitical events. We stay up-to-date on global developments that could affect the supply chain. This proactive approach may involve rerouting shipments, altering certain segments of the transportation process or recommending alternative border crossings to mitigate potential disruptions.
Q: What is Abu Logistics' perspective on the future of 3PL in Mexico and how will the company influence that future?
A: Investing in technology while keeping the human element in mind is crucial. We have a platform that allows clients to automate various processes but our primary focus remains on our personnel. We focus on enhancing both their technical and soft skills. This leads to personalized service and 24/7 support. It is essential to have a team capable of making decisions, understanding client needs and proposing solutions.
While some companies in the US are already exploring options for transporting goods using drones or driverless trucks, Mexico is still years away from such advances. Nevertheless, we must gradually focus on automating our processes. Furthermore, the industry needs to create conditions that encourage greater participation of women in the sector.
Q: What are Abu Logistics' expansion plans for 2024 in terms of services and locations within Mexico and Latin America?
A: We are still determining what the future holds. We constantly evaluate what the market and our clients demand from us and evolve accordingly. We are a company that is 100% customer-focused. Ultimately, that is our value proposition. Our commitment is encapsulated in our promise of "Delivering Success."
We are also looking to strengthen our position in North America. Being a neighbor to the US offers numerous advantages. We aim to become closer neighbors in the truest sense and explore opportunities for increased collaboration in various areas, including harmonizing procedures, modernizing border infrastructure and streamlining coordination.