In the New Silk Road Network, we have always been proud to host both young upcoming companies and longstanding legacy brands. Amongst the latter, Savino Del Bene definitely ranks as one of the oldest, with over 120 years of history. In this interview, we spoke to Mr. Sven Kiaup, Branch Manager of the new Bremen branch office of Savino Del Bene about the motivations of setting up this new location, their future development plans, and also the dynamics of the current freight forwarding and logistics market. We learn about their strong Italian roots and how this has and continues to influence the company on a global scale, as well as their new rail service, appropriately named the “Marco Polo Express”.
In conversation with Sven… …
NSRN: First of all, congratulations on the official launch of the new Savino Del Bene Bremen branch office, the 4th location in Germany for Savino Del Bene. As the branch manager, Sven, what were the key motivations for settling down here? How do you see this bringing value to the current Savino Del Bene portfolio, and what will the key focus points of this new office be?
Sven: Savino Del Bene was looking to increase the portfolio in Germany and globally. Their managing director in Germany, Mr. Andreas Kujawski and myself had worked together for a couple of years before already, so it was a natural fit for our team to join the Savino Del Bene brand.
Savino Del Bene was interested in introducing new operational products in the verticals of pharmaceutical and healthcare. This aligned well with the experience of our team in Bremen. Since November last year, we have gained our own GDP certification in Germany, in addition to our Global GDP certification in our WHQ. In addition, we aim to grow in automotive, machinery, high tech and consumer goods transportation. These verticals are currently in development for Savino Del Bene here in Bremen.
The Bremen office is also responsible for rail freight between Europe and Asia. We have been handling this service for many years, making us quite proficient in this product. This is actually a global launch for Savino Del Bene. The Bremen office will be the control tower for the rail freight for Northern, Western and Southern parts of Europe. All the flows covering these areas will be touching the Bremen office. In essence, our branch acts as a consultation branch; for example, we help other Savino Del Bene branches through our connections with rail operators and partners to get their business on board. We recently supported our colleagues from the UK and Scandinavia, helping them with rail operators and showing that we can handle such services. In the past, this was not possible due to the lack of connections and expertise. So now we are also tasked with spreading the know-how within the organisation instead of just handling the business directly. Naturally as the control tower, we also consolidate for eastbound and westbound cargo amongst our various offices.
Lastly, it is worth mentioning that Bremen is an important logistics hub. In fact, the first standard containers in Germany arrived in Uberseestadt, Bremen in the 1960s, making it a historical place for the logistics industry. So I guess this is another reason to set a footprint in Bremen.
NSRN: As the name would suggest, the brand Savino Del Bene comes with Italian origins. Founded in 1899 in Florence, the company has witnessed tremendous growth in the last century while still maintaining the form of a family business, with minority shares owned by MSC. We read an interesting quote on your website coming from Giampaolo Marchini, "I was a believer in the communist utopia. So I created our logistics empire". This empire, led by Paolo Nocentini since 1977, has currently over 4400 employees and 289 offices around the world. Such a set-up is all but common in the world of logistics today, where mergers and acquisitions happen all too often. How do you see such a leadership structure impacting the culture and development path of Savino Del Bene? How does this influence your day-to-day operations?
Sven:I think our structure shows consistency and regularity. Our president & chairman Mr. Paolo Nocentini has created a stable and robust culture for our company; he's been with us for many decades and is very familiar to all of us. We see that he's always trying to look after each of us and offer support when needed. He is interested in seeing Savino Del Bene grow in countries across the globe, not just through acquisition but through the quality of service we provide. Mr. Nocentini is a service-driven individual, and this is what he instills as value in our company. The point is not to say we can do everything but that we can do what our service portfolio offers in the most perfect ways possible. It is not about providing the cheapest service, but quality and customised solutions for all our customers.
Mr. Nocentini is the main person who navigates the direction of our company. It is great to see that even though the company is quite large as a freight forwarder, such culture he promotes exists through all our offices in the world. Basically, in terms of the day-to-day business, we see that the decisions at the top management level are made quickly and efficiently, allowing us to act fast as well. Taking the example of our rail freight product, we suggested to introduce this within the company to increase our portfolio. The response we got from Mr. Nocentini was quick and positive, allowing us to implement it instantaneously, and push it towards the other locations too.
NSRN: Drawing on the above two questions, it is fair to say that the strong global network of Savino Del Bene provides distinct advantages for the new Bremen office to grow and mature. However, Savino Del Bene's presence in Germany still has much potential to mature and high expectations to live up to. At the same time, Germany is also a very competitive market with many renowned logistics players. How do you think Savino Del Bene can stand out in the German market? Where do you see the next milestones to be?
Sven: Of course, Germany and Europe's markets are competitive. At Savino Del Bene, we want to develop in terms of our service. We might not always offer the rates like the biggest carriers do, but we are here to serve our customers. We are service driven; as I mentioned previously, these values are instilled by our President and chairman Mr. Nocentini. We are not just working like machines and trying to fill the volumes, but we are here to find the solutions.
Especially in the current market situation where ocean freight is absolutely crazy! And air freight is plummeting as well; we are trying to find solutions for our customers that the large companies are unable to provide at such a personal level. We are focused not only on bringing in the biggest customers in Germany but also on small and mid-size enterprises where we see the potential to deliver our services. Our people in Germany are focused on providing the best service and going the last mile for the customer.
It is difficult to say what the next 5 years will be like in the current market. Nevertheless, I see that we have incredible potential to develop our products; to increase our ocean freight, air freight and rail freight share. Out of the three modes, currently ocean freight constitutes the primary sector for Savino Del Bene. Air freight is also quite significant for us; we have a branch in Frankfurt-Kelsterbach, and in the last six months, rail freight has also gained a presence. Introducing rail freight within the whole network of Savino Del Bene has been quite successful as we see more and more attention coming to this product in Europe and Asia. I definitely see the potential to grow, not just for the branch in Bremen but also for the whole German organisation in the next couple of years.
NSRN: Sven, we know from our previous conversations that you have a strong background in ocean and rail freight, which brings us to the topic of the New Silk Road. We recently learned that you have launched a new service called the "Marco Polo Express", connecting China and Europe by rail. First of all, we must say that this is really the perfect name for a service launched by an Italian brand along the Silk Road. Secondly, can you give us more insight into which routes you will cover with this "Express" train? And what type of services are offered in the package?
Sven: The idea for the name 'Marco Polo Express' came from Mohamed El Mazdoula, who is a key account manager for our Pharmaceutical and Healthcare customers. One day he said, "well, guys, I have THE idea, we should name it Marco Polo Express". We all knew this needed no further discussion, and we gave it over to our marketing department to take it forward (laughs). It fits perfectly with our company, its Italian roots and the product itself.
The 'Marco Polo Express' is our general rail product within Savino Del Bene. We cover pretty much all the routes or hubs where rail can arrive. Of course, our focus is between Europe and China. We have regular flows from Southern Europe, such as Italy, to China. We are also expanding our knowledge of the product within other countries in Europe, such as France, Spain and Sweden. We have east and westbound flows in places where we have more potential to grow, such as Germany. Simultaneously, we are entering CIS countries as well. We offer regular flows to Russia and Mongolia, with a dedicated agent in Mongolia.
There are no specific routes though the name implies an “Express Train”; we cater to what the customer needs and try to find the best solution for them. We offer pre and on-carriage services to wherever the customer is located, and customs clearance solutions with our dedicated partners. Surprisingly though, at the moment we have slightly more volume eastbound as compared to westbound!
But, honestly, when speaking about the cooperation between Europe and China on this product, the push is definitely coming more from the EU side, at least for our organization. It might be because the focus in China is still more on ocean freight and air freight, especially when we arrived on board; we asked about this product and had several meetings with our Chinese colleagues, who are aware of the product but only acting on demand. Due to this reason, we are pushing for this product in Asia, where our South Korean and Japanese colleagues are very open to having us on board as we know the product really well and have stable connections.
Therefore we are trying to develop this with our Chinese colleagues, as there is still a gap to fill in terms of connections with rail operators and platforms there. They see the potential and our performance in terms of services. Recently we had a westbound shipment with 15 days of transit time which was a complete success. This really piqued their interest, as it demonstrated the decrease in transit time. I think there is definitely more upcoming now. So we are actively selling both east and westbound, and with increasing awareness, I believe both directions will do well.
NSRN: The "Marco Polo Express" launch aligns with the extreme growth of interest in rail freight along the China-EU market in the last two years; it also comes amidst the depth of congestion, container shortage, and high freight rate problems. How is Savino Del Bene weathering these challenges? And what do you think the outlook for the industry as a whole looks like in 2022?
Sven: This is difficult to say; it is always the last question of the customer as well (laughs). It might be a bit challenging when it comes to westbound flows. I think there will be an improvement in the situations as operators are working very hard to find alternative routes, alternative hubs, to tranship and also to avoid or split volumes, so that not all the volume is going to Malaszewice or Brest, but giving more attention to Kalinigrad, St Petersburg, Budapest and so on. Container shortage is a huge problem too. We are working with customers on shippers-own containers to provide the equipment to the customer. But I see that probably the extreme push on the eastbound flows will be stable until the end of the year. I think the freight rates will be pretty stable as well. A slight decrease in westbound flows might be expected, but it will continue to remain the same in eastbound. Of course, there might be small changes, but not as much as in the past years.
NSRN: With the high rates and tight spaces, there is a lot of pressure on the freight forwarders right now. Some have strived and are aggresively expanding to keep up with demand, others however have not been so fortunate. How do you think the industry dynamics would evolve after the pandemic?
Sven: Currently, the rail operators, the ocean carriers, are actually the ones to decide on specific flows. This is kind of a turnaround from the past years where freight rates were crazy low, and now they are crazy high! I hope that all players will be at the same level at some stage, and each and everyone can earn money without pressuring one side. This would also sustain good relationships between customers, carriers, trucking parties and customs brokers. The idea would be to have stable service throughout the year with schedule reliability of ocean, air and rail freight. Currently, the ocean freight schedule reliability is below 30 per cent; this is ridiculous!
When you look at carriers pushing more into the freight forwarding market, it is evident that one can never fully replace the freight forwarder. Whenever you reach a specific growth or increase your network, you have to somehow make your process smaller and more efficient. At one stage, customers especially need a person to call so as to speak with directly. This is what freight forwarders do; they listen to the customer and find solutions when things are not going well. This is what we tell our customers, that we are a dedicated team here to serve them. We are still accessible and ready to find solutions even outside business hours. In the end, no matter the conditions, there will always be freight forwarders to support the customers in various aspects and processes.
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