DB Schenker Poised For Growth in Expanded Global Supply Chain Arena

Editor's Note: DB Schenker views itself as an integrated logistics service provider that oversees the entire logistics chain. It has over 2,000 locations in more than 130 different countries, employing 66,000+ people.

DB Schenker is worldwide no. 3 in air and ocean freight, and no. 5 in international contract logistics.

• DB Schenker is the market leader in Land Transport in Europe, moving over 100 million consignments by land in 2015 (the equivalent of 3 consignments per second).
• Its ocean freight services see almost 2 million TEUs transported on the world’s shipping routes. If these containers were placed end to end, they would stretch from Frankfurt to Hawaii.
• It handles approx. 1.1 million tons of air freight and commissions 1,200 chartered flights every year for the fast, international exchange of wares.
• It operates over 7 million square meters of ultra-modern logistics space around the world.

In an exclusive interview with SCMR, Jochen Thewes, Chairman of the Board of Management Schenker AG, and Philippe Gilbert Chief Executive Officer, Region Americas expanded upon the findings.

Supply Chain Management Review: DB Schenker sees growth in the Americas. What is it’s economic forecast for the region?

DB Schenker: Our business forecasts for the Americas is very positive. In 2016 we increased our EBIT in Americas by more than 40 percent and in 2017 we are seeing further growth.We are investing in a number of areas, with the opening of our new regional headquarters in Miami-Dade earlier this year, the opening of a number of new support offices across the Americas, continuous investment into contract logistics with special focus on Mexico, Argentina and Brazil, and new Free Trade Zones and cross boarder facilities.

SCMR: Can this growth be sustained?

DB Schenker: This growth is not expected to slow down, with a number of the DB Schenker countries across the Americas as the fastest growing countries across our global footprint.

SCMR: How will you manage this trend?

DB Schenker: All this growth is customer demand generated. We've build a lean business model allowing us to expanding as customers demand our logistic services. While we actively monitor global and local economic indicators, our business model is driven by customer demand.

SCMR: What are the “worst case scenarios” for global economic growth?

DB Schenker: As a company that has a 140+ years history, we've seen a few things. We've seen global growth and recession. We've seen the formation and liberation of countries. We've seen radical geopolitical change. Throughout these times we learn and grow. We focus on our customer's needs, and that's what allows us to prosper whatever is going on in the economy.

SCMR: Can you describe in greater detail its plans for “digital logistics?”
DB Schenker: Digitalization has many opportunities for the logistics industry. Let me highlight a few areas where we believe we are using innovation to provide greater value for our customers:

First of all, digitalization and big data. Clearly our markets are currently undergoing an evolution in digitalization. As our CIO DB Schenker Americas. Richard Ebach said, “The supply chain is easy to predict if it runs as expected. But we live in a world of exceptions.” Presently DB Schenker is investing into data analytics and prediction to bring efficiencies to all our customers.

Secondly - digital platforms. DB Schenker is investing millions to strengthen its strategic collaboration with uShip – to shape the future of digital logistics. In February of this year we acquired an equity interest in global internet marketplace uShip. The uShip platform, which connects shippers and carriers in over 19 countries, is the industry leader in organizing freight transport using mobile devices. For now DB Schenker will use the platform for land transport through an online platform called Drive4Schenker, which will use uShip technology to connect the some 30,000 transport partners in the European land transport network to their freight. The new service launched in Germany earlier this year and is gradually being expanded to other countries.

Third - Innovative warehouse software. We have an innovation partnership with a global electronics company to develop and test new warehouse-technologies. At our Dortmund lab (Germany), we have created a software prototype that can forecast delays in freight deliveries at logistics warehouses and then automatically make suggestions for preventing bottlenecks, i.e. by updating the shift schedules used by warehouse staff. We have warehouses that use both innovative software and automated technology.

Fourth - Autonomous driving. DB Schenker and truck manufacturer MAN are working together on developing networked truck convoys and testing the system in real life. A truck platoon will take to the digital testing ground of a German freeway between Nuremberg and Munich. The second stage will see self-driving trucks tested on the premises of a DB Schenker site in Nuremberg. DB Schenker is also interested in learning how to draw up the optimum platooning deployment plan within our own logistics processes. For instance, we are investigating how logistics centers have to be designed and equipped in the future to load and unload networked truck convoys as quickly as possible.

Lastly - blockchain technology. DB Schenker participated in trials of new Blockchain security benchmarking for global supply chains earlier this year. One of the largest and most comprehensive trials of blockchain technology for global supply chains successfully ended with a new Australian developed blockchain security architecture. TBSx3 is has the potential to raise the global supply chain security from today’s standard to military grade.

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