At Militzer & Münch France: selective growth continues

Militzer & Münch France has acquired the supply chain management specialist ACTE International based near Grenoble. A good investment: Customers benefit from top service – Militzer & Münch identifies new growth opportunities.

Whether smooth supply chain, customs and foreign trade regulations, or the avoidance of corruption risks: cross-border business continues to be a challenge for companies. With ACTE International, Militzer & Münch now has experts on board in Grenoble, experts who offer customers consultancy, service, and training on all aspects of the supply chain (see info box).

This way, Militzer & Münch is consistently expanding its competence in France: In 2018, the company already founded its own customs agency with offices in all its transport branches, i.e., Lille, Paris, Lyon, Marseille, Toulouse, Bordeaux and Nantes. And a few months ago, Militzer & Münch France took over ITP and ITPL, two companies of the LPS Group (Logistique et Prestations de Services), which specialize in transporting goods to the Maghreb countries – one of Militzer & Münch’s key markets.

“The specialists of ACTE International complement our portfolio in the fields of global supply chain management, customs, CSR, and compliance,” says Guillaume de Laage de Meux, who is Managing Director of Militzer & Münch France and at the same time Regional Managing Director South West Europe / Maghreb. “We are confident that with the new offer, we will also be able to convince new customers of our potential.”

“Militzer & Münch has been active between Europe and North Africa for many decades. We manage procurement and distribution logistics for our customers, relying on our profound industry know-how – for example in the pharmaceutical, textile, and automotive sectors. And we see that shipment volumes are increasing from year to year, as for our customers in Europe, the Maghreb states are the logistical bridge to Africa.”

Guillaume de Laage de Meux
Managing Director Militzer & Münch France, Regional Managing Director South West Europe / Maghreb and Member of the Board of Directors of M&M Militzer & Münch International Holding AG

ACTE International – a supply chain management specialist

As an expert in cross-trade, ACTE International has been active in all aspects of supply chain management since 1995: as a freight forwarder and full AEO customs agent, as an auditing and consulting company for international import-export trade, and as a recognized vocational training center. Here is an overview of the services:

Supply Chain Management

  • Coordination and optimization of global supply chains
  • Engineering and management of cross-trade transactions
  • Subcontracting export sales administration
  • Operation of complex import/export logistics


Customs management

  • Customs expertise and consulting for European operators (import/export)
  • International customs coaching
  • Customs and tax optimization
  • Operational customs centralization


Corporate Social Responsibility (CSR)

  • Consulting on CSR implementation at local and international level
  • Social, environmental, construction safety, and anti-corruption audits
  • Assessment and mapping of CSR and corruption risks in the international supply chain
  • ETHIC Intelligence certification* of anti-corruption programs and systems

 

* ETHIC Intelligence is a certification agency which focuses in compliance and anti-bribery audits according to ISO standards. Specialized auditors certify against ISO 37001 and ISO 37301, while also providing general audits for channel partners, suppliers, and against ISO 19600.

Containers are in short supply – what is important now

First Corona, then congestions at the ports, and a change in the flow of goods – worldwide, obtaining loading space in containers has become difficult.  Militzer & Münch has intensified cooperation with customers to meet the challenge by providing pragmatic solutions.

There are about 25 million containers in circulation worldwide, transporting about 90 percent of all merchandise traded[1]. But it is only now, as they are becoming scarce and freight rates are skyrocketing, that containers  are gaining the public’s attention.

Unpredictable dynamics – what caused the shortage

The reasons for the shortage are quickly explained: fewer containers were already ordered worldwide in 2019, a consequence of the trade war between the U.S. and China. With Corona the economy went into lockdown, fewer boxes were ordered during this phase as well. At the end of March 2020, more than four million empty 20-foot containers were stored at container manufacturers’ facilities and at Chinese ports – no one anticipated a shortage at that time.

Then economy started to pick up again, but not everywhere at the same time, and not in all industries to the same extent. The flow of goods no longer follows the familiar pattern, and containers have been piling up ever since at the ports where they cannot be handled because there are also fewer operational ships available. In rail traffic on the China-Europe trade lane, congested border crossings are currently complicating the situation. The problem is exacerbated by construction sites in the rail network and flooding, which means that wagons are not available on time either.

Container manufacturers are currently producing the coveted steel boxes at full speed. But the (shortage) situation is unlikely to ease in the coming months, hampering international trade and raising freight rates.

Militzer & Münch offers customers pragmatic solutions

“It is absolutely crucial that we inform our customers early on, in case there are deviations from the original schedule. Because for our customers, the situation is more than challenging”, says Holger Seehusen, Managing Director of M&M air sea cargo GmbH and member of the Militzer & Münch Group Management. “In order to find viable and sustainable solutions, our globally operating teams are cooperating even more closely with our customers, but also with all partners involved in handling the transport, to offer pragmatic and, above all, affordable alternatives.”

Comprehensive and real-time information

Missing equipment, overload at border crossings, or construction sites – when logistics come to a standstill, Militzer & Münch informs its customers promptly. Thus, there is still enough time to look for alternatives, as some deliveries simply must not be late.

Assistance in finding affordable alternatives

Then follows the search for feasible and affordable alternatives. “In consultation with our customers, we look for solutions on how to work around the bottlenecks,” says Holger Seehusen. “This includes finding alternative routes, modes of transport, and procuring equipment. Our big advantage: we can offer all modes of transport.”

New Militzer & Münch containers

Militzer & Münch has also increased its container stock: the Rail Segment, a business unit of M&M air sea cargo GmbH, has purchased a number of 40-foot containers together with Militzer & Münch China. Some of them got branded.

“Delays will not be entirely avoidable in the coming months,” says Holger Seehusen. “But our customers can count on us to do everything we can to mitigate the situation. This requires a lot of extra work from us, which we are happy to do to serve the interests and needs of our customers. Together, we can do it.”

 

 

[1] This and the following figures on the market situation are taken from Guillaume Dhamelincourt, Business Development – Product Specialist at JK Capital Management, a company of the La Française Group: www.institutional-money.com/news/maerkte/headline/schiffscontainer-knappheit-bedroht-globalen-handel-205915/

 A Militzer & Münch train arrives in Hamburg after its long journey from China.

First LNG truck at Militzer & Münch

Low-emission transports owing to natural energy: Militzer & Münch Serbia now operates its first LNG (liquefied natural gas) powered truck. The specially branded vehicle runs between Serbia and northern Germany, and significantly reduces CO2 emissions on this route.

Thus, the LNG truck is part of the company’s global climate protection strategy. By using the environmentally friendly truck, Militzer & Münch also wants to stand out even more clearly from its competitors. “In the future, we want to expand our fleet by as many LNG trucks as possible,” says Nikola Vasiljevic, Executive Director of Militzer & Münch Serbia.

An eco-friendly alternative to diesel

Like gasoline-powered vehicles, LNG trucks are powered by an internal combustion engine. The natural gas is cooled down and stored in liquefied state, usually in a tank on the side of the truck. While offering the same performance as diesel trucks, LNG trucks cause lower emissions of particulate matter, CO2 and nitrogen.

A premiere: Militzer & Münch Serbia is using a truck powered by liquefied natural gas.

New partnership for transports to West Africa

The contracts have been signed, first transports are already underway: the OMA Group, headquartered in Accra, Ghana, is the new partner for the West Africa transports of the entire Militzer & Münch Group. In addition, some of the country units have joined the African transport network ALNA.

In the future, all transports from the Militzer & Münch network to West African countries will be handled by the new partner. Customers benefit from good area coverage, as the OMA Group has offices in Benin, Burkina Faso, Ghana, the Ivory Coast, Senegal and Togo as well as strategic regional partners in Cameroon, Mauritania, Niger and Nigeria.

The OMA Group has already been successfully cooperating with Militzer & Münch France for the past two years, now the whole Militzer & Münch group has signed an agreement with the company. Initially, the cooperation will focus on transports between the subsidiaries of the OMA Group and the Militzer & Münch country units in France, Turkey, Poland and Morocco. The OMA Group has more than 30 years of experience in the business and offers specialist logistics support services for customers from industries including mining, oil and gas, energy and infrastructure as well as the transport of spare parts for ships in transit.

“With this new partnership, we offer our customers reliable and safe transport solutions towards West Africa,” says Stéphane Grèze, Group Delegate for Africa, who is developing Africa transports for the entire Militzer & Münch Group. “And the demand is growing – already now we see that customers with shipments to the Maghreb also want to handle transports to West African destinations.”

A strong network

In order to strengthen Militzer & Münch’s position in Africa even further, the country units in Germany, France, Switzerland, Uzbekistan, UAE, Morocco, Tunisia and Turkey have joined the Airfreight Logistics Network for Africa (ALNA), a powerful network dedicated to airfreight to and from the African continent. “The network will grant us access to a safe and reliable network of companies in many countries in Africa”, says Stéphane Greze. “Allowing us to increase sales and to develop our Africa business. We will also have the opportunity to receive shipments from the network and thus increase our volumes.”

The cooperation with the OMA Group as well as the ALNA membership are part of Militzer & Münch’s strategy to grow in Africa. Reliable partners and their local expertise as well as a strong network in western Africa will strengthen the position of the logistics service provider on the continent and offer many opportunities in the future.

 

 

The African Free Trade Area – a growth market of the future

The commercial launch of the African Free Trade Area – the African Continental Free Trade Agreement (AfCFTA) – on January 1, 2021 was primarily a formal act. With the exception of Eritrea, all 55 member states of the African Union have signed the agreement; 36 have ratified it so far.

The goal is to create a single African market for 1.3 billion people, with a combined economic output of more than USD 2.3 trillion. The aim of the agreement is to increase intra-African trade, drive forward industrialization and establish regional value chains. The agreement is a milestone for the economic and political development of the African continent.

OMA Group

  • Founded: 1982
  • Head office: Accra, Ghana
  • Staff: 200
  • Management: Group CEO Gerrit Van Der Merwe and Group COO Samad Osman
  • Good networking:The OMA Group is partner in logistics networks including FIATA, ICS and WACO
  • Website: www.omagroup.com

Caption: Stéphane Grèze, Group Delegate for Africa – he drives the development of African transports for the entire Militzer & Münch Group

Militzer & Münch France strengthens Maghreb competence

In Vitrolles, near Marseille, France, Militzer & Münch France has acquired 100 percent of the shares of ITP and ITPL, two companies of the LPS Group (Logistique et Prestations de Services). The management of the business units remains with experienced company founder Jean Louis Poirier.

Both companies specialize in transporting goods to the Maghreb countries, particularly to Algeria. At the Vitrolles site, the business units offer specific logistics solutions with value-added services for:

  • pharmaceutical and paramedical products – this is what ITP (Inter Transit Pharma) stands for;
  • spare parts, especially for the automotive sector – this is what ITPL specializes in (Inter Transit et Prestations Logistique).

With this entrepreneurial commitment, Militzer & Münch France strengthens its leading position in the French transport market, and the Militzer & Münch Group as a whole reinforces its competence in Maghreb transports.“The Maghreb countries are one of our key markets”, says Guillaume de Laage de Meux, Managing Director Militzer & Münch France, Regional Managing Director South West Europe / Maghreb, and member of the Militzer & Münch Board of Directors.
“With our experienced teams in the Maghreb, in France, Germany, Switzerland and Turkey, as well as with the cross-divisional business development team, we are optimally positioned to offer individual transport solutions for different industries.”

The site at Vitrolles

  • Modern facility for warehousing, transit and handling;
  • High security standards: indoor and outdoor video surveillance, remote monitoring, volumetric attendance control, access to each area of the site only with individual badges;
  • Separate areas for cooling products (+ 02° C and 08° C) and storage at constant room temperature (+ 18° C and 21° C) – the areas are accessible via air locks;
  • Areas for order preparation, labeling of goods and packaging; special software for processing labels in Arabic;
  • Modern technological equipment with hydraulic docks, electric pallet trucks, forklifts, compressors for stow bags, etc.;
  • Safe and reliable transportation (with own trucks and drivers).

M&M Business Unit “South West Europe Maghreb”

170,000 – that’s the number of transports handled each year by the Militzer & Münch Group’s business unit “South West Europe Maghreb”. The business unit comprises France, Morocco, Tunisia, and Algeria, and year after year registers an increase in goods traffic between these countries.

“With our experienced teams in the Maghreb, in France, Germany, Switzerland and Turkey, we are ideally positioned to offer customized transport solutions for different industries.”

Guillaume de Laage de Meux
Managing Director Militzer & Münch France, Regional Managing Director South West Europe / Maghreb and Member of the Militzer & Münch Board of Directors

For breakbulk, a broader position

To strengthen its own project business, to further improve service quality in the breakbulk cargo segment, and to offer customers new trade lanes – strong motives for Militzer & Münch to join the Atlas Breakbulk Alliance (ABA).

ABA is part of Atlas International Network Ltd, a global logistics network of local companies active in the air and ocean freight business, which consists of freight forwarders, NVOCCs, and other related service providers. Founded in 1998, the international organization operates on five continents and admits only a limited number of representatives from each country.

Based in Antwerp, Belgium, ABA specializes in breakbulk cargo and project cargo as part of the network and, like the parent network, sees itself as a non-profit service broker. All profits generated by ABA are reinvested in the development of smart tools and (marketing) programs to enhance the members’ breakbulk business and to further optimize the network.

A global network of carefully selected partners

“The membership offers us a global network with profound know-how explicitly in the breakbulk sector, and above all the opportunity to make new contacts,” explains Marco Fischer, Operations Manager Sea Freight & Project Logistics, Düsseldorf. “All carriers and forwarders that are part of ABA were carefully screened beforehand. A classic application process takes place, which also requires external references that are checked by ABA. Membership is subject to a fee, which is another element of the Alliance’s claim to exclusiveness and quality. We have undergone this selection process and have been accepted.”

What is special here is that Militzer & Münch will initially be the exclusive German representative of the Alliance – a strong position and a good opportunity to generate more business in the breakbulk sector.

Benefits for customers

ABA offers a wide range of proven service features to support breakbulk cargo handling at a high service level. Militzer & Münch customers with project cargo and breakbulk cargo will benefit from the new alliance. Not only in terms of service, but also in terms of new trade lanes. “The African continent is gaining more and more importance for our customers,” says Marco Fischer. “This makes Africa an interesting market for us as well, a market where we plan to offer more heavy load transports. But our trade lane managers will also focus on regions such as the USA, India, Southeast Asia, China and South America.” Growth in Africa is increasingly coming into focus for Militzer & Münch. Stéphane Grèze is Group Delegate Africa and promotes the development of the Africa traffics for the entire Militzer & Münch Group. Moreover, Militzer & Münch France has been active in the Maghreb countries for decades, and plans to grow further there. Recently, the French country unit acquired the LPS Group with ITP and ITPL, companies specializing in goods transports to the Maghreb countries.

Exploiting competitive advantages

Militzer & Münch will use the network to position itself more broadly, to close strategic gaps, to strengthen existing out-of-gauge services, and to offer customers a comprehensive overall package. Militzer & Münch’s current breakbulk and project logistics portfolio as well as the already existing network, will be further strengthened through the Atlas Breakbulk Alliance. “This should enable us to participate in new tenders and to provide significant support for existing tenders,” says Marco Fischer. “After all, we can now act as a full-service provider worldwide in this field, offering door-to-door deliveries, professionally executed.”

Handling breakbulk with ABA

  • Several global member meetings per year in collaboration with Breakbulk Europe – there was, for example, a digital member conference in May 2021
  • Preferred access to innovative partners in ICT and supply chain
  • Global NVOCC with FMC and Chinese MoT license
  • Ethical code of conduct including anti-corruption policy
  • International credit risk analysis in numerous countries
  • Container repositioning at 2,500 locations worldwide for more than 250,000 boxes
  • Container Trade Lane Benchmarking Club

“The strategic partnership with Atlas Breakbulk Alliance (ABA) will strengthen the project business and further improve service quality in the breakbulk cargo segment,” says Marco Fischer, Operations Manager Ocean Freight & Project Logistics (photo: center), with department management team Bobby Phan (left) and Sabine da Costa Soares (right).

Spare parts 24/7 – further industries benefit

Spare parts supply around the clock, seven days a week – Militzer & Münch already successfully offers this service to airlines and their fleets. Now, other industries that depend on the fastest possible spare parts delivery can benefit from the offer, too.

When an aircraft has to be grounded because an important spare part is needed, utmost urgency is imperative. For the Hamburg air freight office of M&M air sea cargo GmbH, such emergencies therefore have top priority. “An aircraft that is grounded causes high costs,” says Dirk Bukowski, Regional Manager North Germany. “That’s why it’s enormously important to respond as quickly and flexibly as possible in the event of an AOG emergency.”

From combine harvesters to wind turbines

AOG stands for ‘Aircraft on Ground’, and it is for aircraft spare parts that the 26-person team has primarily been in action to date. “Our customers mainly include airlines in China, Taiwan and India,” explains Dirk Bukowski. “We have now expanded our AOG service to other industries. ”Whether the maritime industry, manufacturers of large vehicles such as combine harvesters and forklifts, or of wind power plants and the workshops assigned to them – many companies rely on short-term delivery of spare parts and can now take advantage of Militzer & Münch’s offer.

On duty, non-stop

The special feature: Militzer & Münch assures its customers of a reliable 24/7 service, completely independent of the logistics provider’s other workload. Shipping and inventory are controlled by the Militzer & Münch branch office in Hamburg via a control tower, which is the interface to customers and partners.

“Our team can directly access our own warehouse, which has not been common in the industry for a long time,” says Jennifer Bastkowski, Branch Manager Airfreight. “The warehouse is connected to our office and is located just a few hundred meters from the cargo area of Hamburg Airport. This allows us to process urgent orders within the shortest possible time. Already, our service is attracting a lot of interest from ocean carriers and commercial vehicle manufacturers.”

Stability even in the pandemic

While expanding its service to new customer groups, the Hamburg team is currently coping with the effects of the Corona pandemic. This is because, although global passenger traffic in particular has fallen sharply, an above-average number of spare parts are currently being ordered that have to be sent on their way immediately – often outside normal working hours or on weekends and public holidays.

At the same time, order handling is now much more time-consuming. “In the times before the pandemic, we transported a significant proportion of our airfreight in passenger aircraft as so-called ‘belly loads’,” explains Jennifer Bastkowski. “Due to the restricted passenger air traffic, this cargo space is largely eliminated, especially on the long-haul route to China.” For the time-critical spare parts transports, there are currently almost exclusively cargo flights available, but they operate irregularly during the pandemic. That makes planning more complex. “Our team has mastered the challenges with flying colors, and the new procedures have long since become routine,” says Dirk Bukowski. “Now we’re looking forward to new tasks in new sectors!”

A new product for Asia-Europe traffics

As a result of the COVID-19 pandemic, capacities in cargo air traffic decreased; departures were also reduced in container shipping. Therefore, the German M&M air sea cargo GmbH has developed an alternative transport option for its customers, which ensures the goods traffic between China and Europe. Since April, regular truck transports have been connecting the People’s Republic of China and Europe. A transport mode especially e-commerce companies are using.

“When it became apparent that COVID-19 would affect all of us for a long time, we realized that an alternative to traditional air and sea transportation was urgently needed,” says Jie Li, Trade Lane Manager Greater China, M&M air sea cargo. “The Trade Lane Management teams in Germany and China developed the new product together. Our Rail team in Düsseldorf is responsible for the coordination and handling of the truck transports, as the colleagues are very familiar with the China–Europe route thanks to their many years of experience with rail transports.”

 

 

Route is adapted to the situation

The FCL transports are currently routed directly from the factory through northwest China to the border cities of Alashankou or Khorgos, then via Moscow, Minsk and Warsaw to the end customer in Germany – a 13,000-kilometer distance. The transport usually takes 13 to 15 days. “The spread of COVID-19 has a strong impact on our transit time,” says Jie Li. “We have to factor in a delay of around three to five days.” If everything goes well, reloading and customs clearance at the Chinese border take two to three days at this time. Depending on how the situation at the border develops, the M&M air sea cargo team will adjust the route together with the local partner in order to always offer customers the fastest possible transport.

The transport option is suitable for all types of freight, especially for dangerous goods. Products with batteries – such as e-bikes, which are currently in high demand in some European countries – cannot be transported by rail. For valuable goods that are transported in a closed trailer, transport by truck is just as suitable as for high-volume, urgent shipments, for instance, personal protective equipment. At the moment, M&M air sea cargo transports lots of goods for e-commerce companies via the China–Europe route by truck.

Although transport by air and sea freight is getting back to normal, road transport on this route remains a sensible alternative: it takes about 20 days less than sea freight and is 30 to 60 percent cheaper than air freight. “Especially for the German market, the product is still new; many customers are curious about it,” says Jie Li. “For our existing customers, the new option is not only a good alternative to air, sea and rail transport, it also opens up great opportunities for us as a team to expand our business and convince new customers of our services.”

 

 

In Hamburg, we benefit from short distances

The “Gateway to the World” – a self-confident label the port and trading city of Hamburg has been using for decades to present itself. The Federal Republic’s second biggest city is an important transportation hub, where vessels from all over the world load and unload their cargo. For Militzer & Münch in Germany, Hamburg is the gateway for sea freight shipments, too, in export as well as in import.

“In Hamburg, we benefit from short distances”, says Dirk Bukowski, Regional Manager North M&M Air Sea. “Theoretically, with digitization today, we can of course organize sea freight shipments from everywhere. But the operations part is much more target-oriented and productive owing to our local branch office at Hamburg sea port.”

The Militzer & Münch Hamburg team can offer their customers all services from one source; they include handling, receipt of the goods and customs clearance. To put the competences to the best possible use, the employees cooperate with all other Militzer & Münch branch offices, most of all in Germany. Thus, the Hamburg colleagues closely coordinate with the Dusseldorf team, which also has a strong sea freight department as it is located near Antwerp.

Not a niche player

Beside sea transport, Militzer & Münch also offers airfreight from Hamburg, without restricting itself to certain industries or goods. “In the literal sense of the word, we are an ‘allrounder’ for our customers”, Dirk Bukowski says. “Generally speaking, we can serve all industries and all the destinations we use for sea freight. we mainly use the magic triangle of Europe-Asia-North America.”

Among the export goods are machinery, components for the automotive sector and consumer goods such as foodstuffs. From overseas, mostly from Asia, Militzer & Münch imports a wide range of products from electric and household appliances to textiles, toys and tea.

North America business especially successful

In the past two years, the Hamburg Militzer & Münch team managed to increase the shipping volume by 10 to 15 percent. This successful development is also owed to the exports for a big German producer of confectionary: every week, several big refrigerated containers leave Hamburg, mainly for Japan, but also for other Asian regions.

Especially good growth is registered in the business in and with North America. Dirk Bukowski names three factors that account for the development:

In summer 2017, Militzer & Münch appointed a Route Development Manager who exclusively focusses on North America; he intensively nurtures the local partnerships.
With teams operating in Germany’s south east, in the west and in central Germany, Militzer & Münch can bank on lots of know-how and was thus able to further develop the sea freight segment.
In Hamburg, an operationally very experienced team is handling exports.

In cooperation with the Munich colleagues, the Hamburg team is handling big contracts with some hundred containers for two German customers exporting machinery, façade components and other construction parts to the North East and the South of the United States.

Targets and challenges

In terms of airfreight and sea freight, Germany is highly developed. The forwarding industry counts many big players. Thus, it is challenging for medium sized enterprises like Militzer & Münch to assert themselves in the market. “Over the past few years, we were able to do many great projects”, says Dirk Bukowski. “But nevertheless, we have to fight. We have to define exactly what Militzer & Münch stands for, and to set ourselves apart from the competition with our services.”

One of the characteristics for example is that Militzer & Münch in Hamburg assigns to each customer one designated contact person, who supports the customer during the entire project in all matters. “Our customers get to meet their contact persons personally, and our staffers know our customers inside out”, says Dirk Bukowski.

The Regional Manager also believes that the “fight for talents” is an essential factor. The Hamburg team wants to be known among young professionals and hire the right personnel. Yet young professionals often want to start their careers with the big logistics corporations. Therefore, the Hamburger Militzer & Münch team offers young talents clear career opportunities – for instance, employees at Militzer & Münch can take on responsibility at an early stage.

“Our target is to generate further growth in the coming years”, Dirk Bukowski says. “To this aim, we want to extend and strengthen our customer base in Hamburg.”

The New Silk Road – a threat to sea freight?

The Chinese Belt and Road Initiative ensures an ever-increasing development of the New Silk Road. Logisticians have since begun transporting more and more of their shipments between Europe and Asia via rail. The Militzer & Münch Hamburg team notices that many customers are already scheduling rail transportation for 10 to 15 percent of their total container volume.

Often, especially time-sensitive goods are transported via rail today, as this is the faster transport mode compared to sea freight. Yet, the continually increasing numbers of rail transports have no negative impact on sea freight transports. It is a fact that sea freight capacities are still by far bigger. As Dirk Bukowski explains, even if rail traffic grew a hundredfold, it would still not decrease the utilization of the vessels. A normal container block train carries 42 x 40’ containers, while nowadays a vessel transports on average 20,000 TEU, which equals 10,000 x 40’ containers.

Brexit – is your supply chain up to it?

Formal deal, no-deal departure, a delayed Brexit – the withdrawal of the United Kingdom (UK) from the European Union left room for every kind of speculation in the past few weeks and months. One thing is clear: the changes in the UK will impact supply chains.

Companies with activities in import or export to and from the UK have to re-asses their supply chains. They have to be ready to deal with the fact that comprehensive customs formalities require additional know-how on the side of their staff. In the future, customs controls can prolong delivery times. Another issue is in how far the company’s IT infrastructure is suited for the Brexit.

The Militzer & Münch customs experts have carried out intensive preparatory work on the topic, and consult companies in all matters pertaining to formalities and statutory regulations. Be it with transports from Scotland to Bulgaria or from Latvia to England – we assist our customers when it comes to clarifying in how far the changed trade regulations are impacting their supply chain.

Should you have any questions concerning transports to and from the UK, please feel free to contact us.

Militzer & Münch customs agency in France

For companies, international trade comes with a number of challenges – one of them is customs management. In order to further simplify the processes for its customers, Militzer & Münch France has established its own customs agency, including an IT module specifically developed for this purpose.

Since January 1, 2018, the new customs agency of Militzer & Münch France has been filing the customs declarations of all ten Militzer & Münch France locations. The customs agency operates with declarants in six branch offices in Lille, Saint-Thibault-des-Vignes (Paris), Marseille, Lyon, Nantes and Bordeaux. Three of them are regional declaration centers: Lille, Marseille and Nantes. The teams have in-depth country-specific knowhow. They are specialists in customs management: be it the customs clearance procedure, customs regulations or the payment of fees and taxes. Each M&M branch reports its demand for customs declaration to its regional declaration center via an IT module that was specifically developed.

Militzer & Münch France does export as well as import customs clearance. “We offer our customers consultancy from A to Z”, says Régis Samain, Manager of Lille’s regional declaration center  and Head of the Customs Agency at Militzer & Münch France. “Our teams are always up to date with the latest developments concerning currently valid customs agreements and regulations as well as the certificates required.”

One customs agency, three regional declaration centers

The headquarters of the customs agency is at the Militzer & Münch Lille (Halluin) office.

  • Lille: In cooperation with the declarants at Saint-Thibault-des-Vignes (Paris) and Lyon, the regional declarations center Lille does the customs clearance for Militzer & Münch Lille, Paris, Roissy and Lyon.
  • Marseille: The Marseille team is exclusively in charge of the customs declarations of Militzer & Münch Marseille.
  • Nantes: The declarants from Nantes and Bordeaux work together with the regional declaration center Nantes – they are responsible for customs clearance of the Militzer & Münch branch offices in Nantes, Bordeaux, Mulhouse and, in part, also Lyon.

Towards a better understanding of the Chinese logistics market

For decades, Militzer & Münch has been operating in numerous countries along the New Silk Road, with mainly the logistics market in China posing a big challenge. For cultural reasons, decision processes follow a different pattern than in Europe. Militzer & Münch wanted to know more about these processes and commissioned the University of Applied Sciences in St. Gallen to draw up a logistics market study on the subject of the Belt and Road Initiative (BRI).

 

 

 


Dr. Thoma, what are the biggest challenges for logisticians in China? 

Logisticians from abroad have to invest a lot of time and energy to prevail in the Chinese logistics market. We have been actively operating in China since 1981, starting with a representative office. Then, in 1994, we founded M&M Militzer & Münch Tianbao Int’l Forwarding Co. Ltd. in China, and were one of the first European companies to be granted the Forwarding (A) License. Our many years of experience have taught us that decision processes at Chinese top management levels are highly complex. Therefore, it is important for us to know as much as possible about the Chinese logistics market and the processes of decision making. The results are not only intended to allow us to make progress in China; they are also meant to help us continue operating successfully along the New Silk Road.

Why is the market study not only interesting for Militzer & Münch?

Thinking outside one’s own structures and networks helps. Which is why the results of this analysis are very interesting for us as well as for other logistics companies operating on the Europe-China trade lane. We find the decision processes easier to understand, and we can better assess the logistics market along the New Silk Road.

 


It is especially the New Silk Road that gains more and more importance for international logistics projects. Who are the decision makers in these global processes? 

Over the past few years, we have already noticed a shift in decision making in the global logistics market. Today, decisions on logistics are made mainly in Europe and the USA. In the future, these decisions will increasingly be made in China, as big Chinese enterprises are more and more forcefully conquering the world market and developing their own supply chains.

What did you learn about the decision processes in China? 

Our own experience was confirmed. 80 percent of the logistics orders in China in connection with the Belt and Road Initiative are awarded to Chinese firms. There is little chance for European logistics companies in China directly – opportunities present themselves mainly in those countries where China is not or just minimally active. Nevertheless, there is the possibility for logisticians to succeed in China, provided they are familiar with the specifics of the market.

What should logisticians pay attention to concerning logistics processes in China?

There are various aspects to be considered. For one, a performance bond in the amount of ten percent of the contract sum is to be issued when the contract is awarded. Moreover, contracting entities in China check the share capital and review the business reports of the logistician.

But perhaps the most important factor for a contract to be awarded in China is trust in the logistics service supplier, trust that has grown in long years of relationships and partnerships. To this aim, logistics companies should in particular develop partnerships with Chinese State-owned Enterprises (SOEs) or with Chinese companies that are closely networked with SOEs.

What are the conclusions logisticians can draw from this result?

For logistics service providers, it is helpful to operate their own local branch office. This is essential in order to successfully build relationships. Having a local management or local partners is especially useful here. It’s the best way for a company to familiarize itself with the cultural differences and to be able to understand them.

Did the market analysis generate any other central results? 

Apart from our objective to learn more about the decision-making processes in connection with logistics projects in China, we also wanted to know what share logistics services have in the Belt and Road Initiative. And on this, we got a wealth of detailed information.

 

Central results of the Militzer & Münch logistics market study on the Belt and Road Initiative (BRI).

 

One central finding of the analysis for instance demonstrates that the Middle East is the region with the highest investments. This means that 43 percent of the BRI investments are flowing, among others, into the development of the infrastructure here. Yet large sums are not only invested in the Middle East, but in South East Asia and Russia, too. These are also the regions where the biggest number of projects is being executed – for instance for the development of transport and energy infrastructure.

All these findings confirm our strategy of increasingly operating in these regions via our own country units. That we commissioned the market study clearly pays off for us in more than one respect.

 

Cooperating with a student team

For the market study, a project team from the St. Gallen University of Applied Sciences and from Shanghai University set to work on behalf of Militzer & Münch. In charge of the analysis at Militzer & Münch is Christoph Hollenstein, Head of Group Controlling, M&M Militzer & Münch International Holding AG. Among others, the students conducted numerous personal interviews in Shanghai as well as phone interviews with decision makers from the logistics industry. The project team also collected significant data on highly promising investment regions along six BRI corridors, and the distribution of the BRI projects. The team based the market study on an alleged investment sum of 1.067 trillion USD and 420 BRI projects. 

 

Militzer & Münch grows in Germany

Including the new branch in the Ruhr district, the Militzer & Münch network now comprises 16 locations across Germany, thus covering the important logistics regions in the country. And there are plans for further growth.

Germany is one of the most important logistics markets worldwide, and was once again appointed top logistics location among 160 countries by the World Bank in 2018. This fact is also mirrored in the business development of Militzer & Münch. In 2017, Militzer & Münch generated above-average growth in the fields of air and sea freight as well as in road traffics.

This development also enables Militzer & Münch to further expand its network: at 16 branches, Militzer & Münch Germany now employs a staff of roughly 250 that take care of their customers’ needs. The service portfolio comprises project logistics, air and sea freight as well as the handling of road and rail shipments and transports along the New Silk Road. In all these fields, there is potential for growth.

 

 

A strong location in the Ruhr district

This spring, Militzer & Münch expanded its network in Germany by opening a new location in North Rhine-Westphalian Sprockhövel near Wuppertal, where Militzer & Münch offers international logistics services mainly to customers from the Ruhr district.

The Militzer & Münch team in Germany already has interesting large orders. “To give an example: For an internationally operating do-it-yourself chain, we supply their branches in Slovenia, Croatia and Bosnia”, says Tom Rosman, Managing Director M&M Militzer & Münch GmbH. “And for a leading technology corporation, we handle rail freight services between China and Germany”, adds Marc Pinheiro, Managing Director M&M air sea cargo GmbH.

Two companies – one goal

The two operational German Militzer & Münch units, M&M Militzer & Münch GmbH and M&M air sea cargo GmbH, both under the umbrella of M&M Militzer & Münch Deutsche Holding GmbH, work in close cooperation.

“Together, we are expanding the service portfolio for our customers in Germany, and we aim to continue growing”, says Tom Rosman. “With the introduction of a new CRM (customer relationship management) system, our activities have become more transparent and can be more easily coordinated.” Currently, Militzer & Münch Germany mainly serves the following sectors: consumer goods, industrial commodities, technical engineering, and automotive.

Plans are also to continue expanding the traffics to and from Tunisia, Morocco, Algeria, Turkey and Russia in the course of this year. To achieve this, the team in Germany cooperates closely with colleagues from the other country units of the Militzer & Münch Group handling, among others, extensive logistics projects.

Germany is “Logistics Champion”

  • For the third time in a row, Germany was selected top logistics location among 160 countries by the World Bank (2014, 2016, and 2018).
  • Decisive criterion is the Logistics Performance Index, LPI. Here, on a scale from 1 to 5, Germany reaches 4.2 points.
  • There are six factors that are evaluated for the LPI: customs clearance, infrastructure, service quality, the price of international shipments, the possibility for tracking shipments, as well as the frequency of goods reaching their destination on time.
  • Germany is especially strong in terms of infrastructure, where the country again tops the list.
  • Rank 2 among the top logistics locations is held by Sweden, with Belgium being third.

More services with the Rail Competence Center

For all rail transports between Europe and China, the new Militzer & Münch Rail Competence Center (RCC) is not only an important interface to the customer, but also to all country units. Michael Spitzlei and his team are working from Dusseldorf, Germany.

The demand for rail transports between China and Europe has been rising steadily for years – a development that is also noticed by Militzer & Münch. Thus the group’s rail transports are all handled via one central point of contact – the Rail Competence Center. Since the beginning of 2018, Militzer & Münch has regarded the RCC in Dusseldorf as a branch in its own right.

 

 

The advantages of the RCC are obvious: Militzer & Münch customers profit from the many years of experience the team combines. “We are familiar with the various import and customs regulations and the different rail track gauges of the countries, and we know how to obtain licenses and certificates”, says Michael Spitzlei, Head of the Rail Competence Center at M&M air sea cargo GmbH. Rail freight from Europe to China takes only 18 to 20 days, which is faster than sea freight and cheaper than airfreight.

An increase in FCL and LCL transports

“We are glad that our services have been so well received”, says Michael Spitzlei. “On the connection Europe-China, we registered a rise of about 30 percent in the full container load segment in the year-on-year comparison. With less than container loads, we even had a 50 percent increase.” The newest service: on the Duisburg-Wuhan route, Militzer & Münch offers rail transport of LCL consolidation boxes with departures from Duisburg every Saturday.

The RCC Team handles eastbound and westbound rail traffics in cooperation with other Militzer & Münch country units. That makes it easier to individually meet customer requirements. Via Militzer & Münch locations in North, West and South Germany, customers from all over Western and Eastern Europe can handle their freight.

The Rail Competence Center – contact details:

Person of contact: Michael Spitzlei
M&M air sea cargo GmbH
Ungelsheimer Weg 6
40472 Düsseldorf
Germany
Phone: + 49 211 43 71 86 0
Fax: + 49 211 43 71 86 25
mumairdus@mumnet.com

New country organization in Sri Lanka

Back in 2015, Militzer & Münch started operating in Sri Lanka via a delegation office. The local team witnesses the growing importance of the country as a logistics location – a good reason to found a country unit here.

Over the past few years, Sri Lanka has become a logistics hub on the maritime Silk Road in South Asia, also owing to the generous expansion of the Port of Colombo. Initially, Militzer & Münch tapped the country´s potential via a delegation office.

Now, Militzer & Münch founded its own country unit in Sri Lanka. The inauguration of the new location was celebrated in May 2018. From here Militzer & Münch offers its customers comprehensive services in the South Asian area.

 

The team serves a niche market

At the new location, Militzer & Münch handles sea freight transports to the regions of the Indian Ocean and Asia. The portfolio of Militzer & Münch Sri Lanka also contains the consolidation of shipments as well as transports to Europe: among the goods are tea shipped to Ukraine, Belarus, Russia, and Denmark, and airplane tires destined for Belgium, Germany, Russia, Denmark and Great Britain.

The five-person team moreover offers standard transportation, airfreight and comprehensive solutions for complex projects. “With shipments to the CIS countries, we additionally serve a niche market”, says Dilum Stembo, Managing Director M&M Militzer & Münch (Pvt) Ltd. “For the future, we are planning to add door-to-door transports to Europe and the USA to our services.”

Logistics in Sri Lanka

The logistics sector in Sri Lanka is constantly gaining momentum. The country’s government has decided to meet the requirements of modern logistics and to sustainably strengthen the sector. Since 2008, the Port of Colombo has been massively expanded. The concept is bearing fruit: The “Liner Shipping Connectivity Index 2017” of the United Nations Conference on Trade and Development UNCTAD declares Sri Lanka one of the best connected countries for sea freight in South Asia – which makes the Port of Colombo one of the most important logistics hubs in the region.

The world’s longest railroad line

The world’s longest railway connection crosses eight time zones. Covering over 13,000 kilometers, it runs from Yiwu in Eastern China to Madrid in Spain. InterRail, a Militzer & Münch sister company, offers regular transports along the record route – also to the benefit of Militzer & Münch customers.

When compared to air and sea freight, the overland transportation comes with two advantages: rail transport is decisively faster than sea freight and much more cost-efficient than air freight. On the longest freight train connection of the world, the container block trains usually transit eight countries: Spain, France, Germany, Poland, Belarus, Russia, Kazakhstan and China.

Along the route, the containers usually have to be transshipped several times, as there are three changes in rail gauge. With transports such as these, all processes have to be coordinated a hundred percent.

No problem for Militzer & Münch. Nikolaus Kohler, Regional Managing Director Middle East / Central Asia, is responsible for the Militzer & Münch national subsidiaries in the region. ”We are deeply rooted in many countries along the New Silk Road – this plays an eminent role for our customers”, says Nikolaus Kohler. “Not only can we offer them flexible solutions on the freight train connection from China to Europe and vice versa, we can also offer them solutions for the markets along this route.

 

Pioneer InterRail

InterRail was the pioneer with container block trains between China and Europe. The first open trains were operated in 2014 by InterRail affiliate TransRail Belarus between Chengdu, China, and Łódź in Poland. As a neutral operator, InterRail also started the train connection from Yiwu to Europe in 2015, with such prominent destinations as Madrid, London or Prague. InterRail also works for other platforms in China like Wuhan, Zhengzhou, Chongqing, Xi’an and others.


Race track for fashion, food and electronics

In most cases, these containers carry consumer goods from China for Spain. Yiwu is the world’s biggest trading platform for numerous products such as textiles and electronic devices. And the Chinese market again is supplied with Spanish ham, wine, water and olive oil. Rail traffic is very important for China – with a destination in Eastern or Southern Germany for instance, rail traffic saves the detour via the ports of Hamburg or Rotterdam.

The transition from Asia to Europe poses a challenge. The railway network in Europe is used to full capacity, border crossings are especially precarious. Here, controls and operative changeovers usually take longer than in China or Kazakhstan.

China invests billions

At least 900 billion US dollars – that’s the amount the Chinese government has set aside or already invested in projects along the New Silk Road. Over 60 countries are involved in the project. Owing to the Belt and Road Initiative (BRI), roads, railway lines, pipelines, power stations, telecommunication networks, ports and airports are being constructed or modernized from Asia to Europe and Africa.

Prospects for further projects along the New Silk Road are good. In November 2017, the annual meeting of 16 European countries plus China was held for the sixth time already. At this meeting in Budapest, the capital of Hungary, China took the opportunity to promote its “New Silk Road” project. Chinese Prime Minister Li Keqiang promised a three-billion dollar investment for Eastern Europe, thus supporting the further realization of infrastructure projects in numerous countries.

How German companies can benefit

The Belt and Road Initiative entails a far-reaching modernization of the global economy. The German business community, too, can profit from the mammoth project. To advise German enterprises of the opportunities, Germany Trade & Invest (GTAI) and the Association of German Chambers of Industry and Commerce (DIHK) initiated an information campaign.

In the paper “Neue Seidenstraße – Chinas massives Investitionsprogramm” (The New Silk Road, China’s massive investment program), reasons are given why it is important to participate in the New Silk Road project.

Introducing a new HGV toll

The German Federal Government’s legislative draft for the new HGV tolling scheme is stirring up the logistics industry. As of July 2018, the road toll is to be extended to include all 40,000 kilometers of federal roads – at the moment the road toll only applies to motorways and a few federal roads. For many logistics companies, this means an additional financial burden.

According to the government, the new toll regulation will generate approximately two billion euros of extra revenue per year. The legislative draft does not yet indicate the exact charge per truck. The government aims to facilitate the financing of federal roads and to improve traffic infrastructure.

At this time, trucks are obligated to pay toll for about 15,000 kilometers of motorways and some federal roads. With the new law, the number of kilometers will more than double. About 130,000 additional trucks will be affected by the amendment – given the currently 1.6 million vehicles, it’s an increase by eight percent. Electric trucks will most probably also be included in the new toll scheme.

New toll terminals

By the end of May 2018, the old toll stations are to be disassembled or shut down to be replaced by new, modernized terminals. Construction of the 1,100 new toll terminals already began in December 2017.

“For the logistics industry, this change of course means higher costs, but at the same time it promises an improvement of the road infrastructure”, says Dr. Lothar Thoma, CEO M&M Militzer & Münch International Holding AG. “Investments are urgently needed in Germany. Conditions are disastrous in some areas, endangering the German economy and thus indirectly the economy in the whole of Europe.”

Momentarily, the truck toll is only compulsory for trucks exceeding a maximum permissible weight of 7.5 tons. But this might change with the new toll scheme. The draft leaves the possibility to include smaller trucks between 3.5 and 7.5 tons as well as long distance busses.

HGV toll in other countries

Nowadays, almost all European countries levy a charge for using their motorways and federal roads. There are two types of road toll: each truck is either charged by distance or time. In England, the Netherlands, Sweden and Bulgaria the toll has to be paid for the time spent on the road; whereas in countries such as Germany, Switzerland, France, Belgium, Poland, Spain and Italy, the charge is based on distance travelled on toll roads.

To compensate hauliers for the toll fees, the German government promises the goods transport industry to continue providing up to 450 million euros per year in financial assistance for employment, qualification as well as environment and safety programs.

New subsidiary in Algeria

Logistics business with Morocco and Tunisia has been successful for years. Militzer & Münch France in particular is the leading forwarder to and from the Maghreb countries, relying on its close cooperation with the well established Militzer & Münch Morocco and Militzer & Münch Tunisia teams. Algeria transports have also continually been on the rise. This is why Militzer & Münch decided to open a subsidiary in Algiers, the capital of Algeria.

For the new country unit, Militzer & Münch cooperates with a renowned shareholder active in international transportation. “For us as a specialist in Maghreb traffics it was only a matter of time before we founded our own subsidiary in Algeria”, says Dr. Lothar Thoma, CEO M&M Militzer & Münch International Holding AG. “With our long-time organizations in Morocco and Tunisia and now with the new setup in Algeria, we are going to consistently develop our Maghreb activities. Our clearly defined objective is to even better tailor our services to this special and challenging market.”

For Algeria, Morocco and Tunisia, Militzer & Münch offers services that go far beyond mere transportation. Thus, the Maghreb solutions comprise, among others, weekly groupage transports of hazardous goods, packaging and quality control, labeling and order picking as well as container stowing at the company-owned 5,000 square meter logistics terminal with 17 loading docks in Vitrolles, France.

The Algerian market

Algeria, the largest of the Maghreb states, has approximately 41 million inhabitants. The People’s Democratic Republic of Algeria is rich in resources – currently, oil and gas exports account for 60 percent of the state revenue. With 85 percent of the goods flows being imports, the market is characterized by an export-import imbalance. Contrary to other Maghreb countries, there is not much relocation of production.

In order to reduce the dependency on the oil and gas sector with its drastic decline in prices, the government aims at enforcing economic diversification. It opens up the country for export; the mining of iron ore and phosphates is to be increased while at the same time, industrial production is to go up, too. Country-wide, industrial cluster zones are being established. All this will benefit the transportation industry and, in the long run, balance the volumes of Europe-Algeria and Algeria-Europe transports.

To the Maghreb and back

Militzer & Münch France has entered into a partnership with Davies Turner, a leading forwarder in the United Kingdom. The objective: developing the traffics between the United Kingdom and the Maghreb states.

The collaboration started in early October. In cooperation, both companies offer groupage transports as well as full truck load traffics. Militzer & Münch France handles imports and exports between the UK, Morocco and Tunisia as part of the partnership. The Algeria transports handled are mostly exports.

The advantage of the cooperation: Militzer & Münch can offer its customers additional transport capacities from and to the United Kingdom, while Davies Turner can further develop its access to the Tunisian and Algerian markets. Davies Turner already operates successfully in the textile sector in Morocco, but will nevertheless profit from the Militzer & Münch expertise in coordinating industrial goods flows via Militzer & Münch Morocco. Finally, Militzer & Münch Morocco facilities in Casablanca and Tangier may offer its clients customs clearance solutions in private bonded warehouses.

Regular traffics to the Maghreb

Cooperating and pooling of forces: On May 1, the Militzer & Münch Group and Andreas Schmid Logistik AG started their joint venture “MMAS Eurasia Logistic GmbH” (MMAS Eurasia). The joint venture offers regular traffics to the Maghreb countries and Turkey. 

The joint venture is headquartered at Gersthofen in the Bavarian Augsburg administrative district, about 80 kilometers to the North West of Munich. Andreas Schmid operates three branch offices in Bavaria and Baden-Wurttemberg, and is the regional market leader for domestic truck transports with an area-wide transportation network in Southern Germany. 

“With the supplementary capacities offered by the joint venture, we can further develop our international door-to-door services”, says Dr. Lothar Thoma, CEO M&M Militzer & Münch International Holding AG. “Especially in the economically thriving South of Germany, we register high demand for international transports. In Andreas Schmid, we have a reliable and potent partner to meet this demand.” Since the beginning of May, MMAS Eurasia has been handling several departures per week from Gersthofen to Morocco, Tunisia, Algeria and Turkey.

A win-win situation 

To Militzer & Münch, the joint venture offers extra transport capacities. Andreas Schmid profits from the well-founded know-how and the outstanding international transportation network of the Militzer & Münch Group. “Owing to the dense local networks of the Militzer & Münch Group, we can offer our customers excellent service in Turkey and the Maghreb states”, says Gianluca Crestani, Member of the Board, Andreas Schmid Logistik. “The Maghreb states hold great perspectives for German enterprises that we can additionally support with perfect local logistics.”


Marked increase in Maghreb transports

There are excellent perspectives in the Maghreb states: Morocco, Tunisia and Algeria are offering numerous chances for German companies. The Maghreb region is an important trade partner especially for the automotive and textile industries. Militzer & Münch is experiencing a sharp increase in transports to this region. The Militzer & Münch Group’s truck traffics between Germany and Morocco for example doubled in the last two years, traffics from and to Tunisia even rose three-fold.

Transit country Turkey

As a transit country between Europe and Asia, Turkey plays an important role for international logistics. “The Turkish government’s investments in the country’s infrastructure are further pushing the demand for transports”, Dr. Lothar Thoma says. In Turkey, the Militzer & Münch Group operates four locations, among others in Istanbul and Izmir.

Additional destinations

With the joint venture, Militzer & Münch and Andreas Schmid add numerous additional destinations to their regular truck traffic network. The joint venture moreover complements the long-standing collaboration of Militzer & Münch with the groupage cooperation CargoLine. Militzer & Münch uses the CargoLine network mainly for international transports to and from Germany and Western Europe.

In May, the Militzer & Münch Group launched the joint venture “MMAS Eurasia Logistic GmbH” (MMAS Eurasia) with Andreas Schmid Logistik AG.