JBC Express on Wednesday launched its first major logistics and warehouse facility at the Jebel Ali Free Zone, or Jafza. The Dh2 million warehouse moves JBC a step closer to its ultimate goal of integrating its various businesses — from freight forwarding to the warehousing and distribution of cargo.
In the next two to three years, the company hopes to expand on a larger scale, with its air freight and sea freight divisions, said its Chief Executive Officer Abhilash Ayyappan.
“We are seriously looking into the mix of logistics models for the company. Right now, we are mainly involved in freight forwarding, but with the opening of this logistics centre, we are seeing a tremendous potential to expand to all aspects of the logistics business in the GCC. We want to become a third-party, or 3PL, company.”
A third-party logistics provider, or 3PL, provides a one-stop-shop service of outsourced logistics for some or all of its customers’ supply chain management needs.
By month’s end, the new Jafza logistics facility, straddling 33,000 square feet, will be operating and catering to JBC’s 1,500 clients, the company said. The majority of these clients are in the oil and gas, industrial pipe, petrochemical, stationery and heavy equipment industries. The logistics business has been spared the worst of the recession, and freight forwarding is still strong, said P.K. Ayyappan, managing director of JBC Express and the father of its chief executive.
“It is mainly the property and construction business that was affected by the crisis. The logistics sector is holding up; people still need to move their goods and have this delivered on time,” the elder Ayappan said.
With economies in the Gulf still generally resilient in spite of the global downturn, JBC has started due diligence work on its plan to raise its profile in the GCC, particularly in Oman, Qatar, Saudi Arabia and Kuwait.
“We will have firmer plans in the next year or two,” said P.K. Ayyappan. “We may be spending Dh8 million for a new facility in Oman. Right now, we are looking for a strategic location.”
Currently, JBC Express has branches in Jebel Ali, Dubai, Abu Dhabi, Muscat and Doha.
In Jebel Ali, the company is planning in the near term an additional Dh8 million expansion that would enable its existing facilities to take advantage of the upcoming Al Maktoum International Airport in the freezone.
“This would further expand our air and sea freight operations. It (would) enable us to offer multimodal transportation options to our 3PL clients,” P.K. Ayyappan said.
The study takes into account premium office rents of Dubai International Financial Centre (DIFC) and Abu Dhabi Global Markets (ADGM)
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