Financial Daily from THE HINDU group of publications
Monday, Feb 11, 2002
Supply Chain Management
Jetex all set to speed up
AT the national convention of Air Cargo Agents Association of India (ACAAI) held in Kochi in November, 2001, a Kolkata-based not-so-big freight forwarding and cargo consolidation company stole the limelight. Indian Airlines ranked Jetex Oceanair Private Ltd the third best domestic cargo mover in India the first time ever for any such firm in the eastern region.
It is for the second consecutive year that the company has got an award, again from Indian Airlines, for achieving the highest domestic sales in the region, posting a growth of about 350 per cent. "In 1989, we were nobodies", said Mr Jaideep Raha, Executive Director of Jetex Oceanair Pvt Ltd. By `we', he meant also three others -- Mr M. R. Haldar, Ms Tanushree Sarkar and Ms Mona Dave: "Three of us (except Ms Dave) were working in companies such as Blue Dart and Elbee and had no plans, by the furthest stretch of imagination, to start any business of our own", said Mr Haldar.
However, at the insistence of some exporters, the four started Jetex Parcel Systems Private Ltd with a capital of Rs 28,000, each contributing Rs 7,000.
Initially, the job was restricted to handling shipments of tea samples to Germany by air. "In first few months, we took the market by the storm as our rates were low and delivery time guaranteed", they said.
But then came the problem. Let down by the airline concerned on a few occasions, both Mr Raha and Mr Haldar went to Mumbai in search of a facilitator and a networking partner but drew a blank. They, however, met one of the former directors of Blue Dart which, at that time had closed down its Kolkata office because of some problems. So Jetex Parcel Systems started acting as an agent for Blue Dart. Till 1995, the arrangement continued. After 1995, when Blue Dart reopened its set up in Kolkata, a new arrangement began, under which Jetex Parcel Systems Ltd continues to act as Blue Dart's operational wing.
In 1995, the promoters of Jetex Parcel Systems launched two more companies -- Jetex Oceanair Pvt ltd and Jetex Tours & Travels. In 1996, the former became the second largest agent of NEPC Airline; in 1999, got the cargo agency of Indian Airlines and in 2000, of Jet Airways. Although Jetex Oceanair is to undertake freight forwarding for both air and sea shipments, the accent has been on air cargo the distribution being 50 per cent air export, 45 per cent domestic cargo by air and five per cent, ocean shipment.
Accordingly, the company has already tied up with a few overseas companies, such as Kinetsu World Express of Japan, Forward Logistics Group, US, and Britain's Air and Cargo Services Group. Jetex Tours and Travels started with the offer of packaged tours to the Himalayas, which was wound up as it found it difficult to manage. It has since taken up the management and operation of Durgapur tourist lodge of West Bengal Tourism.
The promoters attribute the success of their companies to hardwork, teamwork, complete trust and transparency among its partners. "Our employees in Jetex Parcels System have been made shareholders in the two companies we floated in 1995", they observed. True, turnover-wise, Jetex Oceanair is the biggest of the three companies. Growth-wise too, it is far ahead of two others.
"But then it will be rash to claim that everything is smooth and easy", said its executive director, pointing out that the foreign logistics service providers, all giants in the field, such as Panalpina, Bax Global, Kuehne and Nagel, Union Transport, GeoLogistics and others posed a major challenge.
Resources-wise, Jetex Oceanair cannot match them. The foreign companies are much stronger to recruit good people at fabulous salaries.
Networkwise also, they are far superior. Jetex Oceanair was, therefore, mulling how to handle the challenge. "But we are not afraid of competition as our strength is one-to-one interaction with our customers whom we treat as our working partners", Mr Raha said pointing out that Jetex Oceanair now proposed to pay more attention to sea shipments.
Both Mr Raha and Mr Haldar conceded that survival in the business would presuppose providing value-added logistics service for partial or total supply chain management, by using modern technology.
A company might have manufacturing facilities concentrated in one or two locations, but buyers spread all over the country.
Logistics management -- in some cases even called reverse logistics management -- would be important. "Speed is the key word in this matter and nobody knows it better than us", they added.
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