Dubai: Dubai-headquartered third-party logistics provider RSA Logistics sees the industry doubling between 2015 and 2019 in the UAE and is witnessing the mega trends that would help establish it as a prominent logistics hub.
Abhishek Ajay Shah, Co-Founder and Managing Director at RSA Logistics, told Gulf News that service providers focused heavily on oil and gas companies are going to face challenges in the years to come but other sectors will experience a growth in spend.
According to a report by Frost & Sullivan, the UAE logistics sector is expected to grow by 4 per cent in 2016 from $27 billion (Dh99.09 billion) in 2015.
Shah said that the logistics sector in the UAE enjoys a number of unique strengths, including its location, ongoing economic diversification, growing domestic demand, implementation of new technologies and world-class infrastructure, and the government has played an active role in developing the sector.
RSA Logistics, based near DWC-Al Maktoum International Airport in Dubai South, was founded in 2009. The fast growing company offers the full gamut of supply chain solutions, including storage, distribution, transportation, and international freight. The diverse portfolio of customers RSA currently serves ranges from automotive, to power generation, petrochemicals & chemicals, and food and beverage companies.
RSA also offers on-site logistics to provide supply chain optimisation for companies that operate their own warehouses.
“We are a family-owned company and the objective of starting RSA came from an understanding that in most emerging markets globally, the SME high growth sector was underserved in the 3PL space, as compared to multinational companies and small traditional companies. We found this to be a great segment to build and market a high-value product to, providing the flexibility and scalability needed by the SMEs we served,” Shah said.
“We were hit by the global financial slowdown soon after we started, so things didn’t go as expected, including the development of the formerly named Dubai World Central free zone where we are based. We were consequently a new brand left in a place where nobody knew about us,” he said.
So, to keep its head above water, RSA shifted its focus to technology as one of the key drivers of the services it provided, and also began to explore industry-specific segments to tailor services around.
Shah mentions that the change of fortune came in 2010 when the Dubai government invested in completing the DWC airport, road and power facilities.
Today, RSA operates 350,000 metres of logistics space in the UAE alone with 240 people in its team. It has eight closed warehouses and seven open yards.
“We have invested a significant amount into high-quality facilities, people and technology in the UAE business landscape and have about 200 clients totally. We strongly believe in partnerships and collaborations and have partnered with different experts for different sectors,” he said.
RSA entered a joint venture with German chemical logistics specialists in 2013 and created RSA-TALKE to focus on petrochemical and chemical logistics.
RSA also has operations in Kenya and India. Currently, the company is gearing up to open its brand new cold chain facility in Dubai.
Shah said that the company has been growing 20 per cent year on year but last year, it grew by only 14 per cent,” he said
“We will continue to focus on niche industries and will reveal new partnerships later this year. We are looking at investments into Saudi Arabia and India, as well as East African markets in the next three years. Iran is also on our radar,” he said.
He said that the GCC Railway Network will significantly shape the sector and make transporting goods between countries easier, providing governments ensure a free flow of goods.
“It will bring the transportation costs down, offer a better transit time and heavily improve road safety,” he said.
When asked whether the GCC rail and Etihad Rail will positively impact his own business, he agreed strongly.
Moreover, he mentioned that his company has signed a memorandum of understanding with Etihad Rail, developer and operator of the UAE’s national railway network, in 2013.
RSA continues to foster partnerships to brace itself for challenges that present opportunities for growth in the supply chain, staying true to its agenda to grow itself and thereby deliver growth to its customers.
