This year is special for Delamode. The company celebrates 20 years of activity in Romania. We talked to Mr. Cosmin Rusu, General Manager Delamode Romania, about the company’s past present and future, about its successes, its challenges and, overall, about the Romanian freight and logistics market.
″I am optimistic that we will experience an organic growth in the coming years″
You manage the company since 2011. What did it mean for you, personally, the Delamode Romania challenge?
I accepted this new challenge with optimism and desire to carry on the company’s development plans. I knew the company well. I worked in partnership with Delamode for more than 6 years. Since I came at the helm of Delamode, I gained more experience both in terms of providing logistics and from a management perspective. We are a team of 140 people on various segments – Sales, Marketing, Operations, Finance, HR, IT – and we exchange experiences that help us achieve our objectives.
To what extent the experience you have gained at Metro Group Logistics Romania mattered?
Through the position of logistics consumer and being in charge of logistics operations in Romania for 3 internal clients – Metro Cash & Carry, Real hypermarkets and Praktiker – I have gained relevant experience in logistics. In other words, being responsible, among other things, for selecting logistics partners, the MGL experience allowed me to see the logistic capabilities of most important players on the logistics market in Romania, and, by knowing the competition, I can do my job better today.
65% of turnover is generated by road freight and 35% by warehousing and logistics.
What are the changes you’ve made at Delamode Romania?
I focused both on our core business of freight forwarding (road groupage transportation , FTL, LTL, air and sea transportation) and on developing and optimizing the logistics and supply chain solutions. In the last 3 years, I have changed the IT systems (ERP, WMS, Track & Trace) with top technologies solutions, I brought trained and motivated personnel to a team designed to add value to the company, I developed new services to satisfy our customers and last but not least, we have implemented a strict policy of credit control that helps us control better the company’s cash flow. In 2013 we had an increase of 27.5% in turnover over the previous year in freight and logistics segments and I am optimistic that we will experience an organic growth in the coming years.
What new services have you developed?
The domestic distribution service is one that has developed very well in the last 3 years and the Pall-Ex Romania affiliation enabled us to deliver goods to customers 24 hours throughout the country. The service comes bundled with an advanced track & trace system, which allows customers full visibility on deliveries. In addition, we have developed new lines of international groupage to Germany, Benelux, Lithuania, Estonia, Belarus, Russia and supply chain solutions tailored to customer requirements.
What does the AEO certification mean for Delamode clients?
The AEO operator is a reliable partner of the customs authorities, a symbol of competency, transparency and professionalism with which it carries out customs operations. So, clients and / or suppliers prefer to work with AEO certified operators because they have a better predictability of customs clearance period, reduced costs for customs, easier access to customs simplifications – for example, local clearance, priority treatment if selected for control over other operators who are not AEO certified. The clients benefit from the advantages of a secure supply chain.
Can you tell us who are the main clients?
Currently, Delamode Romania has over 1,800 active clients. All our clients are important to us, but I can mention a few well renowned names such IBM, Procter & Gamble, Automobile- Dacia, Pirelli, Honeywell, Metro Cash & Carry, Leroy Merlin, Hornbach, Dedeman, Chep, Ursus Breweries, Avon, Oriflame, Xerox.
What are the external factors that can influence, positively or negatively, the business?
The decreased exports and imports at national level have a significant impact on transport activity, because it creates an imbalance between demand and supply, with negative effects on the providers of freight forwarding services. On the other hand, a stable and consistent tax regime designed to encourage consumption at national level (eg by reducing VAT on certain categories of products) can bring benefits for logistics providers. Factors such as the geopolitical conflict in Ukraine, the undeveloped infrastructure in Romania, the major fluctuations (positive or negative) of foreign exchange rates, the financial blockages of economic operators, also induce negative effects on the business environment. Another major factor is the outsourcing rate which is currently 33% in Romania, compared to other EU member states where it′s over 81%. There is a high potential for development in the Romanian services sector, beneficial fsor both consumers and suppliers.
What are the competitive advantages brought by the Pall-Ex affiliation?
Delamode Romania is a founding member of Pall-Ex network and, being the first and only national distribution network at the moment, we are proud to be part of the network. The benefits are significant: national coverage in 24 hours, custom rates depending on the size of cargo pallets (quarter, half, full, megafull), delivery tracking system (track & trace), high quality of national palletized goods distribution, pallet management.
Is there any sign that logistics migrates from the capital to other cities?
Delamode Romania has regional hubs in Constanţa, Sibiu, Oradea, Timişoara and Bacău and continues to develop by opening new outlets, with logistics hubs designed to optimize the supply chain and satisfy our clients.
Krone recently gave members of Pall-Ex, for testing, a Mega Liner Vario Floor. What do you think about this model and how it could help streamline freight?
Krone Mega Liner Vario Floor is a new concept in the Romania freight market, which allows loading 30 euro pallets on two upper segments, provided that the capacity does not exceed 400 kg per pallet. The total capacity of the trailer is, in this context, of 60 euro pallets on both levels. The main advantage of this system is the flexibility for mixed loads. So, transport becomes more efficient, generates significant additional income due to the additional number of pallets loaded, and has a low fuel consumption and lower emissions.
″The outsourcing rate is 33% in Romania, compared to other EU member states where it’s over 81%″
Daimler introduced this year the autonomous truck, which accelerates and brakes without driver intervention. Under what conditions do you think it should be feasible for a Romanian transporter to invest in such technology?
Currently, I think that there are not many Romanian operators who are willing to invest in such technology due to high costs.
″We plan to open a new logistics terminal in the North West area of the country and a platform dedicated to temperature controlled goods in Bucharest″
What is the Delamode’s goal for 2015?
For 2015 we intend to strengthen our market position in Romanian logistics market, both in freight forwarding segment and warehousing & logistics, by opening a platform dedicated to temperature controlled goods in Bucharest (fruits, vegetables, frozen products) and by opening a new logistics terminal in the North West area of the country.
What are the moments that give you the most satisfaction in your work?
Gaining a new project / partnership with a new customer after a few months’ teamwork and customer satisfaction (eg, one of our major clients has doubled turnover since it went into partnership with us) – these moments bring me enormous satisfaction indeed.
Looking back, there have been a few key moments that had a significant impact in the company’s history. 2004 – Delamode develops a logistics division – Delamode Contract Logistics SRL – focused on the retail segment in Romania, with logistics operations taking place in a 100,000 m2 warehouse, with a fleet of 200 semi-trailers and 40 trucks with controlled temperature, designed to supply the 4 largest retailers in Romania at the time. 2007 – Romania joins the EU, an event which has a positive impact on international transport activity through the development of bilateral relations between Romania and other EU members, as well as a negative impact on Delamode’s business as a customs agent by eliminating customs duties between the member states of the European Union. 2010 – Delamode Romania’s logistics division is sold with a revenue of € 40 million.