Courier companies deliver in Mena turmoil

Courier services, which deal with any number of logistical disruptions each day, were among the best-equipped companies to deal with the turmoil of the Arab Spring.

Industry Insights: Premium business content offered by The National

Last Updated: May 17, 2011

Gulf investors return to Big Apple Now is the time to buy in New York, say property analysts. Abu Dhabi's Aabar Investments and the Kuwait Investment Authority are two groups in the Middle East that believe this is an opportune time to buy. But others have been burnt by the financial crisis. Read article

Rajaratnam may not be the only Wall Street fat cat that needs caging Disgraced Raj Rajaratnam's fleshy face has, like that of con man financier Bernie Madoff, become an embodiment of the worst sort of Wall Street 'fat cat'. Read article

What would Travis Bickle think? The big yellow cab has been immortalised in films such as Robert De Niro's Taxi Driver, but after a contest organised by New York authorities to design a replacement, visitors and residents will soon be able to avail themselves of the Nissan NV200 minivan. Read article

Big opportunities with lower interest rates Bringing down the cost of borrowing encourages investment and spreads liquidity. The signs are good that this will continue, giving the UAE economy a welcome boost. Read article

More Industry Insights

But even they faced difficulties in recent months, with unforeseen challenges to executives.

During the unrest in parts of the Middle East and North Africa (Mena), package-delivery companies faced delays ranging from a few hours to a few days, and sometimes they were unable to complete orders at all.

FedEx, United Parcel Service and DHL Express have each had to suspend mail services to Libya due to the no-fly zone, after having warned customers of delays in countries such as Egypt, Tunisia and Bahrain.

One Egyptian businessman who was to attend the Franchising Middle East exhibition in Dubai two months ago had to show up without the merchandise he had mailed to woo clients.

"With the unrest he couldn't get the shipment out," said Jacob Sebastian, a spokesman for the event.

At DHL Express, the package delivery company with more than 65 Mena locations including 28 in the Emirates, Garry Kemp has been busy developing contingency plans.

The managing director for DHL in Mena and Turkey says most of the company's recent delays were limited to hours.

In Egypt, the issue was traffic congestion caused by demonstrations, although staff were able to meet the challenges and all of DHL's locations in the country remained opened.

The company says it made extra efforts to get customers their packages, which were often passports so people could flee during unrest, by meeting them at airports when other locations were inaccessible.

But planning has become a lot more difficult in Bahrain. Deliveries through DHL's three locations there were delayed by a day when they shut down at the height of demonstrations.

While the country does not provide a lot of revenue for DHL, it is the company's regional air centre, connecting its planes between Asia, Europe and the Middle East.

To avoid widespread delays over several days, Mr Kemp instituted a back-up plan.

"We actually moved that part of the operation for one week to Sharjah," he says. "It was prudent just to be safe because of the potential impact of traffic between Europe and Asia. It involved rerouting aircraft, getting air traffic control approval, getting handlers."

As it turned out, the company could have relied on its airbase in Bahrain. Moving its operations cost DHL but that cost would have been a lot heavier had there been further delays, Mr Kemp says.

"If it had carried on it would have been hard," he says.

DHL's business in Egypt dropped 30 per cent at the height of the unrest but has since picked up again and is on track to surpass last year's performance.

"Overall, throughout the Middle East, we'll end up on or about last year's volume," says Mr Kemp. "Considering what I was looking at a couple of moths ago, it's quite encouraging."

nparmar@thenational.ae