Moving large shipments around the world can be an expensive and complicated operation for companies. DHL Global Forwarding makes the whole process a lot more seamless.
Established in 1987, DHL Global Forwarding has offices and branches in Tokyo, Narita, Haneda, Nagoya, Kyoto, Osaka, Fukuoka and Okinawa. It handles ocean and air freight, customs brokerage, warehousing & distribution.
In 2010, the company handled more than 267,300 air freight shipments and close to 64,600 containers of ocean freight.
Overseeing operations in Japan is Canadian Mark Slade who assumed the position of president and representative director in April. Prior to joining DHL Global Forwarding in 2002, Slade held various sales and management positions in Indonesia, Singapore and Hong Kong. He has spent the last 15 years living in the Asia-Pacific region, working in the logistics industry. He is a graduate of the University of Toronto, St Michael’s College, with a Bachelor of Arts in history and political science.
GaijinPot, together with Japan Today editor Chris Betros visits Slade at the DHL Global Forwarding office in Tokyo’s Sumida Ward.
How is DHL structured in Japan?
There are three operating companies in Japan. One is DHL Express that you associate with packages. Another is DHL Supply Chain, which is a warehousing and distribution business. Then there is DHL Global Forwarding, which handles air and ocean freight forwarding. We are more industrial business to business, and move much larger volumes. The average shipment size for us is a couple of hundred kilos. You’ll often see our 4-ton and 10-ton trucks on the highway to Narita and in industrial areas. We can forward shipments to about 220 countries and territories worldwide, making us one of the truly most global countries in the world.
How does the Japanese market differ from other Asian regions?
Other markets such as Hong Kong, China, Taiwan and South Korea are very export-driven, whereas Japan is a much more balanced export-import market. We’re a very mature economy with low growth and you have to work a lot harder than you would in a market like Hong Kong or China, where the business just walks in the door.
How did the earthquake on March 11 affect business?
Fortunately, we didn’t experience a business dip after the quake. Our volumes have held up more than we expected. Inbound volumes have been better because many companies are resupplying and restocking their inventories and equipment. We have been sending a lot of shipments to the disaster zone. Since the disaster, a lot of factories have shut down or reduced their production because of power and supply disruptions and we’ve seen a real upsurge in our business in Kansai.
How do you market the company?
We’ve got a strong sales approach targeted directly to logistics decision makers rather than the general public. Our business is very much relationship-driven and we deal with customers that have large volumes. The global brand power of DHL is something we leverage on as an added benefit.
What are your strengths?
We focus on value-added service. The business has become very customized and we don’t offer a set take-it-or-leave-it service. Rather, we offer customers a menu-based approach. For example, we can adapt our interface with a client’s EDI (electronic data interchange), linking their system and our operating system, to make the transaction more efficient. We invest a lot in customs brokerage because that’s a critical part of the supply chain. We’re very good as well at dealing with cross-trade business. For example, the transaction is controlled here, paid for here, but may be from a factory or location in China to the U.S. A big advantage to clients is that outsourcing their logistics operations to us reduces their costs. It is a growing trend and one that we can design packages and operating procedures for.
Who are your clients?
We service a lot of Japanese subsidiaries of multinational companies. We have many small and medium-sized Japanese companies and we do very well for them. A lot of them are high tech component manufacturers. For other clients, we’ve handled aircraft parts – seats, wings, cowlings and other large items that cannot easily be disassembled.
Do you use your own aircraft for forwarding?
Our business model is asset light, so we almost exclusively use commercial carriers and steamship lines because that’s more flexible, gives us a variable cost base, and allows our customers to choose the carrier. For huge items, we charter Russian Antonov aircraft.
What percentage of your business is air freight and what percent ocean?
Air freight business is larger. In ocean freight, our core business is consolidation and we typically focus on our LCL product (less than container load). We’ll have a 40-foot container and just load it with a variety of 5 or 10 cubic shipments and send them through a gateway. We can serve about 40,000 points through our global LCL system.
Do you have nationwide coverage in Japan?
Our coverage is quite wide. Kanto is the center of our business. Then we have branches in Osaka, Kyoto, Nagoya, Fukuoka, Hokkaido and Okinawa. We are one of the few international forwarders in Okinawa and also Kyoto, which people don’t often think of as being a manufacturing base.
What are your views on Haneda’s potential?
Narita is always going to be the main hub, but you can’t ignore Haneda. We’ve made the decision to invest up front and opened an office there, the only non-Japanese forwarder to do so. Customs brokerage is very important at Haneda, especially on the inbound side for urgent shipments and downtown deliveries. Haneda proved very important during the crisis because Narita backed up very quickly. We very quickly diverted a lot of relief shipments to Haneda. However, having a two-hub strategy adds additional cost. If Narita became 24 hours a day, that would help our operations.
What charity and community activities is DHL Global Forwarding involved in?
DHL is committed to aid and relief around the world. After the March 11 disaster, within days we were up there in the Tohoku area working with many organizations, the World Food Program for one. We handled warehousing for them. We have our own DHL disaster response team, which is a consulting and logistics unit for disaster management. I have a sales and operation aid and relief team that was already set up before the crisis.
On the environment, we have had a GoGreen campaign for a couple of years and we are already saving power in various ways. For example, we turn off the lights here during lunchtime, and on certain days of the month, at a fixed hour, everybody has to leave.
Every year, all the DHL companies collaborate on some projects such as beach cleanups and book drives. In September, we have a community volunteer day. It helps employees feel better connected to the company.
Are you out and about much?
I visit the branches regularly and go out to Narita a lot. We’ve got about 200 people out there. I also try to meet major customers on a quarterly basis, smaller accounts maybe once or twice a year. I’m happy to meet the frontline personnel who make decisions for our customers as well as the president or general manager at the client company.
Do you hire many staff each year?
Every year, we get thousands of applications from new graduates and we hire some. We rotate them for two years so they can experience the various departments and learn all about freight forwarding. A lot of our mid-career hiring is in sales and my favorite route is through an introduction or relationships. There are a limited number of people out there who have the skills to sell freight forwarding and they typically learn it in the industry. Generally, we have a low turnover. In fact, we have some employees who have been with us for more than 30 years.
Do you do much wining and dining with clients?
It’s still an important part of our business, much more important here than in other countries where I have worked.
How do you like to relax when you can escape from your Blackberry?
Play with my kids. I love to read nonfiction and enjoy all kinds of water sports.
For more information, visit www.dhl.co.jp/en
