Basel firm dominates the high seas

Panalpina has become skilled at using airfreight to move goods around the world Keystone

Swiss firms have long experience of transporting goods over the Alps but one, Panalpina, has come to dominate traffic through the air and over the oceans.

Whether it’s a fleet of Bentleys, a case of fine wine, or a 125-ton turbine rotor, Panalpina has no trouble transporting it across the world.

The firm is one of the world’s top three forwarding and logistics companies, and has benefited enormously from globalisation.

“It’s clear the market is still growing,” said Panalpina CEO Bruno Sidler. “The exchange of goods – and that’s part of globalisation – is accelerating at breathtaking speed.”

The business of forwarding involves the collection, transport and delivery of goods from A to B. In some cases A and B might be just a few kilometres apart, in others they might be separated by an ocean and a continent.

Supply chains

“Forwarding has developed from shipping a case or a carton from one place to another to managing complex supply chains, which involve order scheduling, multiple collection points, managing of warehouses and distribution all over continents,” Sidler told swissinfo.

“We let people know where their goods are at any point in time. We give them an idea of what is coming from various vendors and an idea of their stock position.”

Air freight accounts for about 45 per cent of Panalpina business, followed by sea freight (35 per cent) and the remainder by logistics services

Shipping 40 vintage Bentley cars half way around the world or delivering a 125 ton rotor by air to a power plant in England are just two examples of Panalpina business.

Core businesses are air and sea freight but the company is also a major supplier of logistics services in the oil and gas, automotive and high-tech industries. Regional and local company organisations also serve many other industries, among them textiles, wines and spirits, luxury goods and retailing.

IBM endorsement

Last year, Panalpina received IBM’s “Achievement Award for a Global Logistics Provider” and was asked by the company to set up a fully-integrated logistics chain between Asia and Europe.

“This covers consignments for the production of hard-disks for PCs, laptops and disk drives at two IBM factories in Hungary,” Sidler explained.

The company coordinates the supply of production components from eight countries in Asia and operates a hub in Hungary from which the goods are delivered to the IBM works on a just-in-time basis.

Finally, Panalpina manages the collection of the end products and the shipment back to Asia, as well as to Australia and New Zealand.

Panalpina is not the only big name in Switzerland when it comes to forwarding and logistics. Other big players include Danzas and Kühne & Nagel.

Sidler believes the roots of the Swiss and German traditions of forwarding lie in education.

Start of an industry

“Switzerland, together with Germany and Austria, were the first countries which actually started to launch an apprenticeship in freight forwarding. With that you automatically had the start of an industry,” he said.

“It was these people who ventured out into the world, set up offices and started these global companies. Education and training are still the roots of our success today,” he added.

The movement of goods has become big business, with Panalpina last year recording what it called “excellent” figures. It made a profit of SFr111.7 million ($62.77 million) on sales of SFr6.7 billion.

With 12,000 employees working at 300 branches in 74 countries, Panalpina is now going public. Owned 100 per cent by the Ernst Göhner Foundation, the company will decide in June about the timing of the move, which is intended to make the company more transparent and better known.

“Despite the concentration process of recent years, the forwarding industry is still highly fragmented… Panalpina’s target markets retain considerable potential,” Sidler said.

by Robert Brookes