New Silk Road Network's member PRIMUM was founded in 1997, since then, they have been providing international trucking services in vast lands of the European and Asian continent. The company handles almost everything on their trailer beds, from dangerous goods (ADR) and chemicals, to oversized shipments, temperature-controlled cargo, high-value goods, pharmaceuticals, groupage cargo and consolidation, and project cargo. They have unique expertise in trucking and extensive knowledge of the written and unspoken laws of the local markets.
Last month, our team had the pleasure of speaking with Alexander Smal, Deputy Commercial Director at PRIMUM.
We learn about the growth journey of the company, and how they have managed to stay resilient in an environment where truck drivers are becoming increasingly difficult to hire. Furthermore, we discuss the current market and its impact on PRIMUM’s operations, how they are weathering these challenges and preparing for the future with their eco-initiatives.
In conversation with Alexander…
NSRN: For 25 years, PRIMUM has been providing international road transport with a fleet of over 600 owned trucks and trailers. You also offer warehousing services in Poland, which support your LTL services. Such a heavy asset-based structure must not have been easy to grow in a relatively short period. Can you give us some insights into the history of the company? How was it founded, and what were some key milestones up to this point?
Alexander: PRIMUM was founded on December 29, 1997, in Minsk in the Republic of Belarus. Today it is the market leader in international road transport services in Europe and Central Asia. Three years after the founding we opened an office in Russia. By 2005, the company's vehicle fleet had grown to 100 vehicles, and it was then decided that we had to open a second office in Moscow. The company was furthermore granted the status of a customs carrier. Later on in Germany, the company opened a representative office with its own warehouse, which significantly expanded and helped us gain opportunities in the market of prefabricated goods. Talking about warehousing, actually we offer this not only in Poland, but also in China and at its borders.
In 2011, PRIMUM bought special vehicles for the transportation of oversized cargo and cargo requiring temperature control. Furthermore, the third office in Russia and the office in Kazakhstan with its own fleet were also established. PRIMUM has all the necessary certificates, confirming compliance with the requirements of the leading chemical industry councils (SQAS) and ISO, the guarantees of control over the transportation of medicines (GDP) and guarantees of compliance with the complex security measures for the transport of high-value cargo (TAPA). In addition, PRIMUM also holds certification confirming a high level of professionalism in the market of international freight transport, financial stability, and merited business reputation with BAME and FIATA.
In 2015 and 2021, PRIMUM was recognized as the best carrier of Eurasia according to the world road transport organization IRU. We were also nominated as the best in developing logistics infrastructure in the competition "Forwarder of the year – 2021" organized by the association BAME.
Now PRIMUM offices are in 7 countries: Russia, Kazakhstan, Uzbekistan, Poland, Belarus, Germany, and Mongolia. Amongst these, the Uzbek and Mongolian offices were founded most recently in 2022.
In December 2019, construction began on the new PRIMUM headquarters in Minsk, despite the pandemic, it was completed in less than two years. In September 2021, construction was completed and by October, the PRIMUM team had moved into a new home just in time to celebrate the company's 25th anniversary. We have a big team and big headquarters now. Our presence in 7 countries allows us to carve out many possibilities and helps us to work all over the world. Thanks to the efforts of a professional, creative, and loving team, PRIMUM today takes its rightful place amongst the largest and most successful transportation companies.
NSRN: As a road transport company, two elements are vital to your core business, the fleet and the drivers. IRU's (International Road Transport Union) annual driver shortage survey shows vacant commercial driver positions continue to increase at alarming rates across the globe. How do you anticipate the sector to face this challenge in the future? Has this impacted the business operations of PRIMUM?
Alexander: Indeed there is a trend of increasing driver shortage, but luckily this has not affected us yet. We have anticipated such problems, hence we have improved our bonus systems for drivers and their families to mitigate this. We create good conditions for our drivers, no matter if they have experience or not. We train the beginners ourselves and help them during their internship to study shipping and customs documentation, we run test drives, we also have internal theoretical and practical exams and the bonus systems to motivate them. So far, we have not had problems equipping our fleet with drivers, however we are geared towards tackling such issues in the long term. We hear routinely hear from our European counterparts about the shortage of drivers. Sometimes drivers from our region also travel to Europe, to Poland primarily, to support the deficit, though this is not often.
NSRN: How many drivers do you employ? And can you give us some insights into how you groom them?
Alexander: Our company has about 1500 employees and over 1000 of them are truck drivers, so you can see how high the ratio is. We hire people without experience to work and we provide intensive training here in our office. This means that they learn the PRIMUM mentality and way of work. We prepare them to become a part of our team because the best service can only be offered when we teach them what to do and how to do it. Most of the drivers come from Belarus, Kazakhstan and Russia.
Apart from a good income, our bonus system is very lucrative and offers ample opportunities for our drivers to earn extra over their stipulated payments. This helps us retain our drivers and find new ones quite easily. Our training programs also helps them settle down as part of the team and not many drivers in our employment have left. The system at PRIMUM is robust.
NSRN: PRIMUM offers tailored solutions for the mining industry, oil and gas industry, chemical industry, agriculture, construction, and engineering. Each of these sectors requires different expertise. What can you tell us about the PRIMUM team and their various specialties?
Alexander: As mentioned, PRIMUM has a large staff of over 1500 employees. This enables us to offer a wide range of services in different verticals. For each type of transportation, there are departments with highly specialized people who are certified consultants. We hold international certificates (TAPA, SQAS, GDP) that are permanently established, and our trucks are equipped with necessary with ADR kits.
NSRN: When it comes to road transportation, PRIMUM's core market is connecting Europe, Central Asia, and the Far East. What are the main challenges when covering such a wide range of geographic territories and countries? What is your advice for those who want to operate in this field?
Alexander: The basic challenges are the permitting systems of all these different countries, the varying weather conditions, and managing different time zones. But these challenges interest us, and we like to look for new ways and opportunities. Our advice to those who want to delve in: don’t be afraid of broadening your horizons – and it is not only about logistics.
NSRN: In the last two years, the logistics industry has been plagued by congestion and delays, not just at major seaports but also inland at various border crossings. With hundreds of trucks on the road between Europe and Asia, PRIMUM sees and experiences the congestion firsthand regularly. Can you give us an overview of the situation right now? And how has PRIMUM been tackling such challenges and repositioning its trucks?
Alexander: The congestion in sea freight and rail freight has led to an increasing interest in road freight. In many situations, only trucks can save the customers. There are many factors influencing this of course, for example, not all types of cargo can be carried by sea and rail, such as ADR cargo. Secondly, transit times are much faster by truck and that is important for valuable goods and urgent cargo, as with the case of e-commerce. Thirdly, trucks can intervene when there are problems, you can take out the stuck containers for one reason or another and deliver them door to door.
But when we do notice that there are delays occurring at certain border crossings for our trucks, we change the pattern of our work and instantly find alternative border crossings and alternative modes of delivery for the redistribution of cargo. We have our own representatives at each border and responsible people here in the office that are monitoring the situation at all these points. This way, we can check the situation on each border and react quickly.
For example, during the Covid-19 pandemic, many border crossing points were closed for cargo transportation. It was a challenging time. The most difficult thing was when you have cargo in a closed warehouse, you cannot take this cargo from its location to another warehouse or use another border check point. It gets stuck there and you can't do anything. Luckily now the situation is stable, the border ports are working, and we are represented at each of them. We work closely with China, which is our main direction right now. I would say maybe 80% of our loadings are for cargo from China.
NSRN: Do most of these go to Kazakhstan, or are there a lot of cargo amongst these that move further on to Europe?
Alexander: Yes, we conduct a lot of traffic to Europe. It's not easy for us due to the permitting systems of various countries. However, for a long time we have successfully coped with this task and carry out transportation from China to various countries such as Belgium, Germany, Poland and even the United Kingdom.
NSRN: The rise in gas prices and environmental policies that are being implemented in some European countries have led to a discussion about truck transport companies switching to heavy-duty hydrogen-electric trucks in near future. In that sense, how do you see the future of road logistics?
Alexander: As for PRIMUM, greener options to transport have always been a priority for us, which is why our complete fleet consists of vehicles that meet the latest eco-safety classes, Euro 5 and Euro 6. Moreover, we think that electrification and the consequent reduction of emission, is an accessible technology that we are considering applying in certain geographic areas. As practice shows, electrified trucks are designed for well-asphalted roads where special charging stations with relatively short distances in between are located. As far as we can see, this is theoretically possible in Europe but not in the countries of Asia where mountains and even landslides create dramatic geographic conditions to navigate.
It is worth noting that PRIMUM has often thought about eco-initiatives, and we even have internal competitions among employees to come up with innovative solutions. One of the ideas we have implemented is that instead of disposing used tires, they are now recycled and made into foot matts for the truck cabins. We also have personnel that are responsible specifically for eco-incentives. Their tasks include promoting eco-friendly practices and collecting ideas from all the employees working in our company. They not only organize these competitions as we have mentioned, but also impact our investment decisions. For example, researching what sort of eco-friendly equipment to purchase, such as our trucks being EUR 5 or EUR 6. And then further on, how many trucks and which brands of lorries should we buy? These practices make us better and are important to our clients as well. We are always looking for ways to outperform our competition, and taking environmental initiatives is one of the significant ways to do that.
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