Specialist
Corporate Head at Panalpina World Transport (Holding) Ltd
Agenda
- Freight forwarding competitive landscape
- Threats to pure play freight forwarders having vertically integrated freight forwarders and 3PLs
- Strategic options for Ceva's (VTX: CEVA) contract logistics business
- Damco Maersk and Ceva CMA CGM comparison
Questions
1.
Could you outline your views of market share changes in freight forwarders? What is driving key differences? There seems to be some variation in growth rates of the main players around market growth rate.
2.
Do you think the larger players continue to grow faster than the smaller players and the market?
3.
What range in buying rates would you typically expect between a player that is 1-3 vs a 10-11 and vs some of the smaller ones around the 1% market share, 20-25 position?
4.
How might buying rates develop with both organic and inorganic growth?
5.
How much easier is it to scale through acquiring smaller customers vs acquiring larger customers?
6.
Which of the big players do you think are best at accessing small customer accounts?
7.
How do you think about comparing the quality and width of the sales organisation across the key players in order to drive small customers?
8.
You mentioned margin pressure on the freight forwarders in buying rates. What is your view on buying rate evolution over time and where do you think it is heading for the coming quarters?
9.
The margin is mainly driven by the buying rate discount you get as a freight forwarder. How have these discounts progressed over recent years as a result of depressed TEU [Twenty-Foot Equivalent Unit] prices?
10.
What is the rough margin you would get per TEU for a freight forwarder?
11.
What sort of YoY changes have you observed on the CY-CY [Container Yard to Container Yard] margin? What do you foresee to be the margin going into 2020?
12.
Do you think there will be any uptick as the TEU price picks up again, or will the shippers put that straight through to bottom line and not feed any through to the forwarders?
13.
What pricing changes have you observed YoY as the movement goes from CY-CY into end-to-end? What sort of supply dynamics are impacting the pricing?
14.
Which players do you think are moving focus or concentrating on the end-to-end and moving away from the CY-CY?
15.
How do you view CEVA [Logistics] and Damco in the end-to-end play?
16.
We mentioned the technology, the associated costs and then the buying rates for the smaller players. Is that particularly in the CY-CY, or is that also in the end-to-end as well?
17.
When driving scale for CY-CY, how would you go about getting purchasing power to shippers, compared to getting scale for the import/export matching? Operationally achieving that, are there different levers to pull, or is it the same way you do it?
18.
Who do you think is best at acquiring the smaller local players and areas to have the best-matched portfolio?
19.
How much more consolidation are you expecting in the next 2-3 years? What impact could it have on pricing maturity and competitive dynamics between the top players?
20.
What impact will consolidation have, with the shippers acquiring all of the forwarders? How do you think that would come through into pricing for the forwarders, especially if they weren’t to have the shipping lines push the volume onto the forwarders, and if the shipping lines weren’t to put the volume on?
21.
What would happen if one shipping line was to go through the direct contractor lines with the forwarder, and the others were all to go with the passing prices through to subsidiaries? How do you think that would play out?
22.
How do shippers decide between sourcing directly with a shipping line or indirectly through a forwarder?
23.
If CMA CGM offered a EUR 25-50 discount to CEVA, how would that impact the whole group? Would it feed through directly into the margins?
24.
Who do you think is more likely to get more aggressive and shift big accounts, CMA or Maersk?
25.
Do you think the pressure to execute on the synergies becomes greater as more shipping lines acquire forwarders?
26.
How do you think synergies changes for land vs ocean, if at all? How do you view the acquisition of forwarders on the land part vs the ocean part?
27.
What do you think are the key risks associated with the strategy of giving preferential prices to your subsidiaries in shipping line-forwarder synergies?
28.
Could you expand on the loading guarantees? Do you think they would be enough to convince the most risk-averse of shippers to shift over forwarding volume to the forwarder of choice?
29.
What sort of synergies do you think you could drive as a result of a strategy where you went in on prices at around EUR 25 and also put in loading guarantees on contracts as a forwarder?
30.
What do you think a carve-out would look like in contract logistics? Who do you think would be likely to acquire it if you think it doesn’t fit well with the CMA CGM portfolio?
31.
What sort of multiple do you think there would be on the contract logistics business?
32.
What CAPEX would you expect to be able to recover the EBIT margin on this business?
33.
Could you summarise your outlook on the synergies between freight forwarders and shipping lines?
34.
What is the EBIT that the contract logistics makes at CEVA, roughly?
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