3PL news: CEVA launches Supplier Awards program
July 18, 2011 - LM Editorial
Global supply chain and logistics services provider CEVA Logistics recently held its first global Supplier Awards ceremony. CEVA said these awards were launched as “part of its relentless quest for excellence” and are designed to recognize “impeccable execution, commitment, and strategic alignment among” its supplier base. LM Group News Editor Jeff Berman interviewed CEVA CEO John Pattullo about these awards and current trends and issues in the global 3PL market. A transcript of the interview is below.
LM: How did the Supplier Awards come about?
Pattullo: CEVA has 50,000 suppliers throughout the world, and we increasingly want to develop partner relationships with a smaller number of those so these awards seemed like a good opportunity to recognize performance and to cultivate relationships. We took the 50,000 and selected that down to 21 and from there we picked a winner for each of our four geographic regions—Northern Europe, Americas, Southern Europe, and Asia Pacific—as well as for air, ocean, and road, along with a top Supplier of the year (Editor’s Note: a complete list of winners is at the end of this article).
LM: What were some of the biggest takeaways of these awards from a CEVA perspective?
Pattullo: It was great to see how encouraged these companies were to be recognized, as well as their commitment to CEVA. We hope to make this an annual event.
LM: When it comes to the stalled economic recovery and mixed outlooks and forecasts regarding the economy, what is your take on the global 3PL market?
Pattullo: The economy really seems to be taking a few steps forward and a few steps back feeling to it. There is not a huge amount of overall economic growth occurring. That said, what we are seeing is extremely patchy. Over in Europe, the German economy is really quite strong, with minimal unemployment and significant manufacturing-driven export activity. Things are going well in Brazil, too, and our business there is very healthy. Korea is doing well, too. There are softer spots in southern Europe. For the global 3PL market, things appear to be largely in sourced, with roughly 80 percent of the global logistics and 3PL market. In less domestic markets like China, that figure is even higher.
LM: What does these mean for a large player like CEVA?
Pattullo: If we can get the fundamentals right by driving operational excellence and leveraging scale or IT or operations to drive value, that should result in solid growth prospects.
LM: CEVA has done a good job of building up its presence in the United States at a time when things like meaningful retail growth remain sluggish. How are things going for the company in the U.S. market?
Pattullo: We recently hired Matt Ryan as President of CEVA in the Americas. In America, we are operating at an integrated and sub-regional level and have split the U.S. into three regions and each of those regional bodies is handling both contract logistics and freight management. This integrated platform has been successful, because more shippers are looking for a 3PL to handle all their needs for things like integrated logistics offerings in the form or air freight, ocean freight, customs brokerage, transportation and logistics and general supply chain support. We have also been active on the freight management side for both import and export management and our U.S. business on those fronts has been strong. CEVA has also been developing a stronger U.S. domestic hub business, which was somewhat soft the last couple of years, particularly as shippers migrated from air to over-the-road transport. There has been some progress made on the contract logistics side, particularly in the technology space.
LM: What is your take on U.S. retail sales, which is showing slow growth?
Pattullo: These numbers do show a low level of economic growth, but I really don’t think that to be a major concern for a company like CEVA, as we still have a small U.S. market share in a market still hungry for top-quality operations. There is modest growth, but no cause for alarm as we still have plenty of growing to do in the U.S.
LM: In terms of working with shippers, what are you hearing when it comes to the supply chain and logistics obstacles they are asking CEVA to help fix? What are some of the biggest things they are asking for?
Pattullo: The most significant customer need is control and visibility across the supply chain. Shippers with very long and complex supply chains always need to know where their goods are all the way through their logistics processes. That is especially what we are hearing from large customers getting involved in global manufacturing, which is especially constant wherever they are selling goods. A second thing I hear quite a lot about, particularly in the energy sector, is risk and compliance. I really believe customers expect more predictable and higher quality operations. If you look at manufacturing operations and see stable performance and predictable outputs, shippers expect the same thing from logistics operations.
LM: Looking at the market, many shippers are focused on doing what they do best and leaving logistics to companies like yours. In the future do you expect the global 3PL market staying at current levels or expanding?
Pattullo: Definitely expanding. I firmly believe the global 3PL market will grow faster than GDP and even with the relatively slow economic growth, the global economy is still growing, with the 3PL market staying ahead.
Winners at CEVA’s inaugural Supplier Awards were:
?-Supplier of the Year: Office Depot
?-Air: Lufthansa Cargo
?-Ocean: Safmarine Container Line NV
?-Road: Mercer Transportation Company Inc
?-Northern Europe: Office Depot Inc.
?-Americas: CB Richard Ellis Inc.
?-Southern Europe, Middle East and Africa: AKNO Business Parks S.p.A.
?-Asia Pacific: APS Group (Holdings Pty Ltd).
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