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LOGO            SP Jain Center of Management
                            11th December, 2010




                            CILT – ESCF forum

  “Trends in Logistics a nd Supply Cha in Industry
                      in GCC”
 ANKUR DAFTUAR                ANUJESH SINGH              GAURAV CHAWLA
MBA: Global Logistics and    MBA: Global Logistics and   MBA: Global Logistics and
Supply Chain Management      Supply Chain Management     Supply Chain Management


                  Under the guidance of Dr. Rajiv Aserkar
                   (Professor, Logistics and Supply Chain)
AGENDA

Strategic Location of GCC


           Global Logistics Overview


                GCC Logistics Overview


                Impact of Recession


                Drivers of Change


          Future Trends


What’s in the store!
The Strategic Location




Gateway to a market of over 3 billion consumers !!!
67% of the world’s population is within 8 hr flight
Global Overview
                 Global 3PL revenue from fortune 500 companies by industry

           Consumer Products
                   2%
                       Other
  Healthcare Industrial 3%
     3%         3%
Food Groceries
     6%                                                                    Global Logistics Size
                                                                              (as of 2009):
                                                                              US$ 1 trillion
                                           Automotive
                                              29%

                                                                                 Growth rate:
    Elements                                                                      3 – 10%
      16%




                                Technological (Hi-
                                     tech)                                Global 3PL Revenue:
              Retailing
                                      22%
                                                                          $ 210 billion (2009)
                16%




Source: OECD, Armstrong and Associates, Mercer Management Consulting, World Bank, Transport Intelligence
GCC Logistics overview :
Logistics Performance Index

                                                                       Ability to track and
  LPI Rank                                                             trace consignments
                                                                              5

                                                                             4                           Competence and
  UAE          : 24                                  Overall                                             quality of logistics
                                                                             3
                                                                                                             serrvices
                                                                             2
  Bahrain: 32
                                                                             1

  Kuwait : 36                                                                0
                                   Quality of trade and                                                         Ease of arranging
                                    transport-related                                                         competitively priced
  Saudi Arabia : 40                   infrastructure                                                               shipments


  Qatar        : 55
                                                 Frequency of ontime                            Efficiency of customs
                                                      delivery                                   clearance process
  Oman         : 60

                                              UAE         Qatar   Bahrain        Saudi Arabia        Kuwait       Oman



Source: www.tradingeconomics.com   Scores: 1= Low... 5= High
GCC Logistics overview :
UAE and LPI : Elements of the vision

                       State‐owned enterprises to lead & insp
                       ire by investing in mega projects
                       High government spending on infrastr
                       ucture
                       Public sector excellence in service an
                       d operations
                        World‐class govt. performance
                                   Government:
                                   A key driver

    High quality infrastructure                     Trade & transportation hub

    Pro‐business regulatory policies                Tourism & MICE prime destination

    Highly skilled labor                            Knowledge economy, based on ed
                                                     ucation, Higher Colleges, Media, Info.
    Free‐zones & economic clusters                  &Communication Tech, and financial
                                                       sectors
Attractive invest-                                                 Focus on Core
ment environment                                                  economic factors
GCC Logistics overview :
GDP growth

                                  Read GDP growth rate : GCC
                20
                          Bahrain       Kuwait      Oman      Qatar      Saudi Arabia       UAE


                15
  %age growth




                                                                                         Strong
                                                                                         growth
                10                                                                      potential



                5



                0
                 2005    2006         2007       2008      2009       2010      2011         2012
                                                   Year
                -5
Source: International Monetary Fund
GCC Logistics overview :
Global Competitiveness
                             37
                           Bahrain
                                                               Factors considered
                35
                                                   • Institution            • Labor market
              Kuwait                               • Infrastructure         • Financial Market
                                                   • Macro economic         • Technology
                                                     environment            • Market Size
        34
       Oman
                                                   • Health and education • Innovation


                   25
                  UAE
                                               21
                                              Saudi                 17
                                                                   Qatar


Source: Global Competitiveness Report, 2010, World Bank
The enabling trade Index : GCC


       23                                        37
                                                                                53
                  18                                                                   42       40
                              16                            24            22


    2008       2009        2010              2008        2009       2010       2008   2009     2010
             UAE                                      BAHRAIN                     SAUDI ARABIA

                       GCC gearing up for trade in a big way!

       50                                                                                       65
                                                                                58     59
                                               41
                  34                                      35          34
                              29


    2008       2009        2010            2008        2009       2010         2008   2009     2010
             OMAN                                      QATAR                          KUWAIT
Source: The Enabling Trade Index Report 2008-2010, World Economic Forum
Effect of Recession

     Project Logistics hampered due to downfall in real estate
     Fall in oil prices led to turmoil in shipping
     Job insecurity
     Demand plunge : facility reduction more than required
     Bad to worst : Press effect



     Thinking, Re-thinking
     Focus on LEAN
     Market Cleansing : Vanishing of sub-standard businesses
     Market Development: Expanding the fish pond
     Revenue to Relationship : Mergers and partnerships
Drivers of Change

    < 2009                                     Future




                        DRIVERS
                   Government support     Integrated and level
 Individualistic
  approach &           Oil Prices             playing field
    suffering
                    Human Resource
                   Technology (esp. IT)
FUTURE TRENDS

     Modernizing        Green
         GCC
                       Logistics
    infrastructure



    Increasing role     3PL +
         of IT        Consulting



     Increasing         Talent
     Complexity        Retention



      Shift from        Culture
    Asset Heavy to
                      adaptability
      Asset light
What’s on surface




Source: Arabian Supply Chain, Khaleej Times
What’s in store
                            Emirates Airlines on a buying spree
                            • Addition of 2 aircrafts each month for the next 6 years

                            • Dubai used as base to create a global network


                            Dubai Strategic Plan 2015
                            • DWC becomes the world's first logistics platform with all
                              transport modes
                            • RTA has developed a comprehensive roadmap to integrate
                              roads, highways, rail and marine transport within the emirate




                            Soccer World Cup - 2022
                            • Plans to spend $4 billion on a stadium construction and
                              refurbishment
                            • Annual growth forecast of 15 per cent in 2010 and 16 per cent
                              in 2011
                            • Invaluable image campaign for the region

Source: Arabiansupplychain.com
Thank You!
Please feel free to contact!

              Ankurkumar99@gmail.com
              Ankur has worked for 5 years in shipping industry as a merchant marine
              officer. During the job he reduced the Tanker turnaround time for the
              vessels by effective voyage and cargo planning. He has led
              multinational/multilingual teams while managing various operations and
              coordinated with various International Regulatory and Administrative
              authorities.



              Ism.anujesh@gmail.com
              Anujesh has worked as a Process Engineer for almost 3 years in Minerals
              and Metals Industry. Through all these years he has worked in diverse
              projects that involved providing end to end solutions to Clients. Anujesh
              has done his BTech in Mineral Engineering from Indian School of
              Mines, Dhanbad.


              Gaurav@gloconomics.com
              Gaurav is a mechanical engineer and has worked in automotive sector for
              around 3 years on Strategic Projects in Manufacturing. He is trained in Six
              Sigma green belt and has worked extensively on in-plant logistics, capacity
              planning, theory of constraints, global benchmarking and operations
              management. One of his projects on asset utilization has won a National
              Award at IMTMA Productivity Summit 2008, India.

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Trends in Logistics and Supply Chain in GCC

  • 1. LOGO SP Jain Center of Management 11th December, 2010 CILT – ESCF forum “Trends in Logistics a nd Supply Cha in Industry in GCC” ANKUR DAFTUAR ANUJESH SINGH GAURAV CHAWLA MBA: Global Logistics and MBA: Global Logistics and MBA: Global Logistics and Supply Chain Management Supply Chain Management Supply Chain Management Under the guidance of Dr. Rajiv Aserkar (Professor, Logistics and Supply Chain)
  • 2. AGENDA Strategic Location of GCC Global Logistics Overview GCC Logistics Overview Impact of Recession Drivers of Change Future Trends What’s in the store!
  • 3. The Strategic Location Gateway to a market of over 3 billion consumers !!! 67% of the world’s population is within 8 hr flight
  • 4. Global Overview Global 3PL revenue from fortune 500 companies by industry Consumer Products 2% Other Healthcare Industrial 3% 3% 3% Food Groceries 6% Global Logistics Size (as of 2009): US$ 1 trillion Automotive 29% Growth rate: Elements 3 – 10% 16% Technological (Hi- tech) Global 3PL Revenue: Retailing 22% $ 210 billion (2009) 16% Source: OECD, Armstrong and Associates, Mercer Management Consulting, World Bank, Transport Intelligence
  • 5. GCC Logistics overview : Logistics Performance Index Ability to track and LPI Rank trace consignments 5 4 Competence and UAE : 24 Overall quality of logistics 3 serrvices 2 Bahrain: 32 1 Kuwait : 36 0 Quality of trade and Ease of arranging transport-related competitively priced Saudi Arabia : 40 infrastructure shipments Qatar : 55 Frequency of ontime Efficiency of customs delivery clearance process Oman : 60 UAE Qatar Bahrain Saudi Arabia Kuwait Oman Source: www.tradingeconomics.com Scores: 1= Low... 5= High
  • 6. GCC Logistics overview : UAE and LPI : Elements of the vision State‐owned enterprises to lead & insp ire by investing in mega projects High government spending on infrastr ucture Public sector excellence in service an d operations  World‐class govt. performance Government: A key driver High quality infrastructure Trade & transportation hub Pro‐business regulatory policies Tourism & MICE prime destination Highly skilled labor Knowledge economy, based on ed ucation, Higher Colleges, Media, Info. Free‐zones & economic clusters &Communication Tech, and financial sectors Attractive invest- Focus on Core ment environment economic factors
  • 7. GCC Logistics overview : GDP growth Read GDP growth rate : GCC 20 Bahrain Kuwait Oman Qatar Saudi Arabia UAE 15 %age growth Strong growth 10 potential 5 0 2005 2006 2007 2008 2009 2010 2011 2012 Year -5 Source: International Monetary Fund
  • 8. GCC Logistics overview : Global Competitiveness 37 Bahrain Factors considered 35 • Institution • Labor market Kuwait • Infrastructure • Financial Market • Macro economic • Technology environment • Market Size 34 Oman • Health and education • Innovation 25 UAE 21 Saudi 17 Qatar Source: Global Competitiveness Report, 2010, World Bank
  • 9. The enabling trade Index : GCC 23 37 53 18 42 40 16 24 22 2008 2009 2010 2008 2009 2010 2008 2009 2010 UAE BAHRAIN SAUDI ARABIA GCC gearing up for trade in a big way! 50 65 58 59 41 34 35 34 29 2008 2009 2010 2008 2009 2010 2008 2009 2010 OMAN QATAR KUWAIT Source: The Enabling Trade Index Report 2008-2010, World Economic Forum
  • 10. Effect of Recession  Project Logistics hampered due to downfall in real estate  Fall in oil prices led to turmoil in shipping  Job insecurity  Demand plunge : facility reduction more than required  Bad to worst : Press effect  Thinking, Re-thinking  Focus on LEAN  Market Cleansing : Vanishing of sub-standard businesses  Market Development: Expanding the fish pond  Revenue to Relationship : Mergers and partnerships
  • 11. Drivers of Change < 2009 Future DRIVERS Government support Integrated and level Individualistic approach & Oil Prices playing field suffering Human Resource Technology (esp. IT)
  • 12. FUTURE TRENDS Modernizing Green GCC Logistics infrastructure Increasing role 3PL + of IT Consulting Increasing Talent Complexity Retention Shift from Culture Asset Heavy to adaptability Asset light
  • 13. What’s on surface Source: Arabian Supply Chain, Khaleej Times
  • 14. What’s in store Emirates Airlines on a buying spree • Addition of 2 aircrafts each month for the next 6 years • Dubai used as base to create a global network Dubai Strategic Plan 2015 • DWC becomes the world's first logistics platform with all transport modes • RTA has developed a comprehensive roadmap to integrate roads, highways, rail and marine transport within the emirate Soccer World Cup - 2022 • Plans to spend $4 billion on a stadium construction and refurbishment • Annual growth forecast of 15 per cent in 2010 and 16 per cent in 2011 • Invaluable image campaign for the region Source: Arabiansupplychain.com
  • 15. Thank You! Please feel free to contact! Ankurkumar99@gmail.com Ankur has worked for 5 years in shipping industry as a merchant marine officer. During the job he reduced the Tanker turnaround time for the vessels by effective voyage and cargo planning. He has led multinational/multilingual teams while managing various operations and coordinated with various International Regulatory and Administrative authorities. Ism.anujesh@gmail.com Anujesh has worked as a Process Engineer for almost 3 years in Minerals and Metals Industry. Through all these years he has worked in diverse projects that involved providing end to end solutions to Clients. Anujesh has done his BTech in Mineral Engineering from Indian School of Mines, Dhanbad. Gaurav@gloconomics.com Gaurav is a mechanical engineer and has worked in automotive sector for around 3 years on Strategic Projects in Manufacturing. He is trained in Six Sigma green belt and has worked extensively on in-plant logistics, capacity planning, theory of constraints, global benchmarking and operations management. One of his projects on asset utilization has won a National Award at IMTMA Productivity Summit 2008, India.