Aramex redesigns operating model to capture growth opportunities
New regional structure created with eight global markets, tasked with growing footprint and maximizing commercial opportunities, led by Andy Van der Velde as president
Aramex has announced that it is adopting a new operating model with the strategic objective of enhancing customer service levels and operating efficiencies, while capturing greater global market share within both the B2C and B2B customer segments.
Aramex Express, which includes international and domestic delivery solutions will serve the B2C customer base including Shop & Ship, e-commerce, FMCG, SMEs and other customers needing innovative last mile solutions. Meanwhile, Aramex Logistics, which includes air freight, sea freight, land freight, and warehousing and distribution, will serve B2B customer base across multiple industries including oil & gas, healthcare & pharmaceutical, aerospace, retail & fashion, amongst others.
To ensure the new operating model can successfully create greater value for multiple stakeholder groups, a chief operating officer role has been created for each of Aramex Express and Aramex Logistics. Mohammad Alkhas has been appointed COO for Aramex Logistics, while Alaa Saoudi has been appointed COO for Aramex Express.
All support functions, including Finance, Human Resources, Procurement, Digital and Customer Contact Centers will be provided centrally by Aramex’s Corporate Centre, which will also manage M&A and Strategy, Legal, Risk and Compliance to ensure global control and alignment across the newly formed clusters.
Othman Aljeda, group CEO of Aramex, said: “The global transportation and logistics industry is undergoing a fundamental shift, driven predominantly by the boom in e-commerce, supply chain disruptions, customers’ increasingly discerning expectations and the turbo speed of digitisation. For Aramex to stay ahead of the curve and remain a competitive, reliable and sustainably growing industry leader, we decided to focus on capturing growth opportunities by decoupling our core services."
"By creating Aramex Express and Aramex Logistics we will have a more agile company, focused on capturing the right opportunities to grow and diversify our customer base, investing in and deploying the best and latest technologies, and operating at higher efficiency levels. The investments we are making in our business today will enable us to provide our customers with improved service levels, and our shareholder with long-term value,” he said.
To support Aramex’s global growth ambitions, the organization has also created a new regional structure composed of the Americas; Europe; Sub-Saharan Africa; Middle East, North Africa and Turkey (MENAT); GCC; South Asia and North Asia; and Oceana. Each region will be led by a regional vice president and will have dedicated commercial and operations teams focused on growing Aramex’s local footprint and driving commercial opportunities and customer-centric innovations. Each region will report to Andy Van der Velde, who has been appointed president. Van der Velde was previously Aramex’s Regional CEO for GCC, Australia, New Zealand and Southern Africa.
“We see good growth opportunities in the express segment, which currently represents 70 per cent of our revenues. We intend to continue to grow our express business by creating new trade lanes domestically and internationally, and scaling up ground operations to cater to growing customer demands, while continuing to invest in technology and automation," Othman Aljeda said.
"Our logistics business accounts for 28 per cent of our revenues and we intend to aggressively grow our footprint in our core markets, and markets that will enable trade flow into the region. Therefore, we are investing in specialized warehouses to cater for high potential verticals, and are also scaling up infrastructure beyond main cities to provide extensive coverage. On freight forwarding, we see good growth opportunities in several sectors, one example being O&G with the revival in global oil prices and trade activity,” he added.
According to recent market studies, the global logistics industry is expected to reach $1,232 billion by 2025, registering a compound annual growth rate (CAGR) of 7.5 per cent from 2020 to 2025. The global e-commerce logistics industry is expected to reach a value of $657 billion in 2025, recording 8.6 per cent CAGR in the forecasted period. Meanwhile, both freight forwarding and contract logistics are projected to record a 6.2 per cent growth to reach $242 billion and $331 billion respectively.
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