Intermax Logistics Solutions has developed a name for itself as experts in cold-chain logistics along the Belt and Road and are active members of the New Silk Road Network (NSRN). With 11 offices across China and strong business coverage across Eurasia, they strive to build reliable connections between East and West. Recently Rob Brekelmans was welcomed into Intermax as their European Business Director. Our team had the pleasure of speaking with him about the development of Intermax, the need to adopt a "Hub and Spoke" system in Europe, and the importance of wholesome as opposed to low-cost transport solutions.
Knowledgeable and worldly are the most appropriate adjectives to describe Rob Brekelmans. Sitting in his mahogany tinted home-office, with a background of huge bookcases, Rob exuded intimate knowledge of the logistics industry. Here is what we learnt…
NSRN: Would you like to tell our readers more about your company's profile? What is the growth that your company has achieved to date?
Rob: Intermax was started in 2001 by Michael Miao. It began as a freight forwarding company, and it also performed project cargo worldwide, involving heavy machinery. In 2016-17, I was the managing director for New Silk Way Logistics, and Intermax was handling all cargo for them in China, and that is how I got in touch with Michael. We mutually developed the business focusing on eastbound instead of westbound, which is typical. That is where there is a lack of knowledge and know-how of the operations exist. We could prove to our customers in Europe that we have value by dealing in door-to-door service. The problem for most European companies is that they do not have a solid base in China where you can deliver your goods to the customer's door and undertake customs clearance. However, 99% of our business is door-to-door, both eastbound and westbound. We make deliveries from any point in Europe to any location in China. Apart from China, we offer similar services to Korea, Japan, Thailand, Taiwan, Vietnam and other countries in Southeast and East Asia.
Apart from the Belt and Road Initiative (BRI), Intermax also deals with air freight and project cargo. Another one of our exciting aspects is that we also have a trading license. We allow our customers to buy and sell in China using our license. We also have a shipping agency, including river and barge services. Apart from that, we have our own trucking company, customs agency, and we also help our customers navigate the Free Trade Zones in China. We also have accessibility to bonded warehouses without VAT or import duties, in these Free Trade Zones.
NSRN: Can you tell us a bit more about your background and role at Intermax?
Rob: I have been in the freight forwarding business since 1984. I work and live in the city of Breda, Netherlands, but I have worked all over the world: Russia, USA, Saudi Arabia, Morroco, Romania, even Egypt. Mainly. I was always in international logistics starting with air freight, then ocean freight after which I set up European distribution centres for foreign companies. I have a strong foundation in the logistics rather than freight forwarding, transforming trucking and forwarding businesses into international logistics companies. I joined Intermax to help develop their business and focus on the rail business to/from Europe specialising in cold chain logistics with green solutions, including developing 45-foot reefer containers.
NSRN: Intermax provides door to door synchromodal services between Europe and Asia, with a strong focus on the BRI routes. How has the BRI related to transport solutions impacted your business?
Rob: Before the Belt and Road, there was only ocean freight and air freight. We were delighted when this system was established, unfortunately, you see a lot of reluctance in Europe because all things that are unknown or related to China are approached with some scepticism. But I explained that this a way to open to the world and gain more opportunities. Instead of wrongfully assuming that China is conquering, look at the number of avenues that have opened. People think that the BRI is only for trade via the rail freight, but the idea is also for cultures to mingle and countries to develop in tandem. At this juncture, we come in with our focus on eastbound, because of a large market there. Initially, we looked at the types of products coming in from China, which were primarily electronics. However, we wished to expand the pharmaceutical company coming going from Europe to China. Most companies only can deliver from door to hub; that is why they do not have complete control over the product, unlike us.
NSRN: What do you think are the significant challenges that need to be overcome for the New Silk Road, especially with the rail routes, so that more people adopt them, and it becomes more efficient?
Rob: Due to the current corona crisis, air cargo took a hit. Before corona, we could compete with air freight only rate-wise. Many companies had shipments coming into Shanghai, which had to go to the inland of China. However, these situations take a long time by being stranded at the hub. With rail freight, we could cut down on that time, by going towards the inland. These are the advantages of rail freight; its speed makes it faster than ocean freight, at the same time cheaper than air freight. Moreover, it is reliability where we come in and where I see a lot of value in the BRI.
A few years ago, we saw massive development of rail systems in Europe, but there was not enough cargo moving on it; hence they were shut down. I believe that the concept Hub and Spoke System can tackle this issue. We need to develop the Hub and Spoke system in Europe where containers arrive in a European city with a hub. From this specific hub, the product is either trucked to the destination or sent via rail. In connection with BRI, people need to adopt the Hub and Spoke system.
To give an example of a Hub and Spoke system, imagine if cargo has to be transported from China to somewhere in the middle of Europe. You can consolidate products from Shanghai or Beijing and bring them to Xi'an. Then combine those and then move them to Warsaw or Hamburg, Duisburg, Paris , from there on distributes them to the receivers. Hub and Spoke system is the future of the BRI.
I have been giving lectures on the Hub and Spoke system in China and Europe. Rather than pointing out that there may be competition between different cities and provinces in China, I suggest that they focus on a specific region in China and from there consolidate the products, bringing them to a particular location in Europe. We are looking at a door to door solution with regards to the Hub and Spoke system.
NSRN: Intermax has a distinct edge in temperature-sensitive cargo, such as pharmaceuticals and perishables, and also horticulture/greenhouse products. It is quite a niche market; how do you view the future of this area?
Rob: I see a development in the future of the former Russian Embargo products such as frozen meat, fruits or other types of perishables where you see the use of reefer containers. We have already developed these in Intermax. Apart from that, there is a movement of plants and saplings to/from China. Customs-wise in China, you cannot deliver all the products to all the stations. In Europe, we have the Common European Customs Law, which allows the clearance of cargo at the nearest European border, preventing complication at different country borders, but this is not the case in China. If you want to deliver seafood, you can go to Xi'an, but not to Wuhan or Hefei. You need to have the customs license and the CIQ (Customs Information and Quarantine), which is not the same everywhere. People think that you can deliver to a particular hub because the rates are meagre, but the problem is that you cannot use it. A lot of logistics people are not aware of this information. We have the expertise, and we have the equipment to make sure that products reach safely.
In Intermax, we are working on solutions, and that's why we want to use NSRN as a base where we share our value with the members in the network. We are not competing with current freight forwarders in Europe, because they have their own market, and we are not setting up our own company in their regions to compete. We are neutral players and respect all relationships between customers and forwarders. Our knowledge is not a threat; on the contrary, we wish are adding value for their customers utilise.
NSRN: Are there any recent/flagship shipments that demonstrate Intermax's capabilities in cold chain logistics that you can share with us? For instance, we heard that you moved smoked salmon via rail, how did that go?
Rob: It is essential to know about the new development taking place in the logistics industry, and more so using them for one's benefit. The Russian Embargo was already opened last year in March, but you need an electronic seal, which is put on the containers by Russians and removed on arrival. Unfortunately, these seals were unavailable, and one needed a license to receive them, which were absent at the time. After managing to procure those, with New Silk Way we were able to move the first salmon shipment from Norway to China. One begins by looking at the number of hurdles and resolving them.
With our partners, we have constructed a control tower in Romania, where we follow our containers via GPS and Satellite, which the customers can access too. We have also developed an 'Intervention System', where we have maintenance crew along the routes that solve any problems that might crop up with the reefer containers. We track the containers and receive a real-time electronic alert which is shared with our partners who are doing maintenance.
NSRN: On a final note, would you like to share some wisdom with our readers, members and those in the logistics industry?
Rob: If you are going to your customers to get new business, you will face competition. But the problem is that everyone goes for low rates and not the solution. You must convince your customers that in the total group one has expertise in either a region or a mode of transport. The key is to work together and combine our strengths to deliver a reliable solution. We have already worked with another member in NSRN, transporting cargo from the southern part of China to south Germany during the coronavirus crisis. We have advantages that go beyond just hankering for low rates. We are transparent and are competitive with the benefits we offer.