By Clifford F. Lynch
DC Velocity, January 2006
If he lay awake at night back in 777 B.C. making
mental lists of tasks to be completed before the following year’s Olympic
Games, Iphitus undoubtedly ranked logistics issues closer to omega than alpha.
Since there was only one event (the sprint), there was virtually no equipment to
move. And although the games were open to Greeks from all over the world, a
relatively small number of competitors were expected. Since word had not yet
reached Iphitus about the opportunities for television contracts, sponsorships
and merchandising, he didn’t have to worry about logistics complications
arising from, say, the presence of TV crews.
Fast forward about 2,800 years to Athens in 2004. You have to wonder what
Iphitus would have thought of the logistics challenges presented by the modern
Olympic Games: receiving and storing some 12,000 SKUs – everything from DVDs
and javelins to traffic cones and safes – and transporting them to 60
different venues in and around Athens.
Of course, he wouldn’t have had to do it alone. Carriers like Schenker and
DHL swooped in and out of Greece, delivering international shipments. And a
consortium of experts took charge of the local logistics activities. In fact,
that consortium – which included supply chain consultant BLS Ltd., Delatolas
Express Cargo, third-party provider Frakapor Logistics Hellas S.A. and Frakapor
Holdings Ltd. – received high marks for its contributions to the Games’
success, which, not incidentally, helped raise awareness of logistics and supply
chain management throughout Greece. While I usually don’t write about personal
experiences, I recently had the opportunity to conduct a logistics outsourcing
seminar in Athens, where I had the pleasure of meeting logistics managers from
both the client and provider sides. Over a two-day period, we discussed the
opportunities and issues that confront logistics practitioners in Greece,
particularly in outsourcing.
Practically non-existent 25 years ago, Greece’s logistics service provider
(LSP) industry received a boost from the elimination of customs taxes in 1993,
which sent demand for warehouse space soaring. Even so, the market for
outsourced services lags well behind the rest of the European Union. According
to Alexander Horn of Schenker S.A. in Athens, the "use of 3PL services
remains relatively low at nearly 10 percent."
Still, the outlook is rosy. The market is expected to grow about 10 percent
annually over the next few years, says Evangelos Angelotopoulos, managing
director of BLS Ltd. Big players like Schenker, DHL and Kuehne & Nagel
already have a presence in Greece, and smaller regional companies are thriving.
Much of the infrastructure is already in place. Greece offers a good highway
system (particularly since the Olympics). Its economy is growing, and its
government offers subsidies to businesses looking to operate logistics
facilities. Although the fledgling industry still faces obstacles – insiders
complain about the difficulty of acquiring land and obtaining zoning changes –
there appears to be no reason why it shouldn’t fulfill its growth projections.
As for the challenges ahead, the issues identified by both LSPs and their
customers have a familiar ring. The LSPs worry about competing with the global
providers, profitability, their ability to provide global service and marketing.
Their clients fret about the cost of outsourcing, the implications of
relinquishing control, technology and the availability of truly global services.
What I took away from this trip was the affirmation the U.S. logisticians are
not unique. Their problems are the problems of the worldwide supply chain
community. We should look to one another for answers.