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Retail& IPO
portation services. The same applies to office
and warehouse facilities. This gives us
significant operational and financial flexibility
and allows us to provide various transportation
options to our customers and to develop
optimal solutions for their transportation
needs. You need flexibility, especially in
today’s supply chain management. Just look
at the number of OEMs that are shifting
their production platforms further east, both
within Europe and to Asia. Being asset-light
and cooperating with best-in-class suppliers,
we are able to adapt very quickly to
specific customer demands.
Apart from the general situation on
the stock markets, what has
changed since 2002? What have you
achieved to make Panalpina even
more fit for going public?
Wilfried Rutz: To start with one of the most
recent changes, we have, at our extraordinary
general assembly of 23 August, revised our
Articles of Association and approved an
extension of the Board of Directors from five
to seven members. The four newly elected
members (see page 8) will further enhance
the industrial competency of the board and
will help to ensure that the Group’s leadership
stays in experienced hands, both in
regard to the listing and in view of our growth
strategy. We have every confidence in this
new team, and I am sure our investors will
honour this decision. At the executive
management level, we have reduced the Executive
Board to four members in June of this
year. By making it leaner and introducing the
two new functions of Chief Operating Officer
and Chief Administrative Officer (see page
10), the Executive Board’s decision-making
process has been facilitated considerably and
flexibility has clearly been raised.
6 connect 2_2005
“The Foundation
will retain a
substantial stake
in Panalpina over
the long term.”
What were the reasons for the
recent changes at regional management
level?
Gerhard Fischer: By implementing regional
management structures three years ago,
Panalpina has reached its essential goals, in
particular strengthened local sales capacities
and standardized global operation processes.
Also in June 2005, in a second step
towards the further development of these
structures, we partially redistributed the
responsibilities between the regional centres
and corporate head office in Basel. This
adjustment was particularly geared to support
the Group’s productivity objectives
through more efficient functional guidance
at managerial level as well as to re-focus our
global project portfolio. The former Emea
region was divided into two separate
regions, with Europe on the one hand and
Africa/Middle East/Central Asia on the other
hand. Furthermore, China (formerly part of
the Asia-Pacific region) was split from Asia-
Pacific into a separate region. Thus, the existing
four were replaced by six regions,
managed by lean organizations operating as
regional competence centres.
What was the reason for choosing a
geographic rather than a product
segmentation like some of your competitors
do?
Gerhard Fischer: We have a global business
which is executed from area to area or
even from country to country and accordingly
influenced by local customer requirements.
We manage our company geographically
in order to enhance cross selling
opportunities and exploit the full potential of
our sales force. We are convinced that our
approach is successful, as most of our customers
are organized by geography as well.
Which of your regions has the
highest growth potential? One would
guess it’s probably China, isn’t it?
Gerhard Fischer: The Asia-Europe/Europe-
Asia trade lane represents Panalpina’s most
important market, and our share of the volumes
transported on this lane is significantly
higher in both air and ocean freight than our
respective overall global market shares. Panalpina
intends to increase its turnover by
capitalizing on its strong presence in Asia,
where demand for transportation is expected
to grow faster than in other regions of
the world. Asian cargo markets continue to
lead air cargo industry growth while ocean
freight volumes are anticipated to grow at a
similar rate to air freight. The liberalization
of trade services in China paved the way for
Panalpina to obtain the licence for a wholly
owned enterprise in Shanghai in 2004. Nine
additional operating branch licences have
been applied for, and we expect to obtain
the respective licences this year.
So far, Panalpina has been growing
organically. Will this strategy change
in the future? Is providing the financial
means for bigger take-overs
one of the reasons behind the IPO?
Gerhard Fischer: Our growth strategy will
not change. We don’t believe in huge acquisitions
just for the sake of growing “by any
means”. Our focus will remain on organic
growth, supported by very specific and
selected so-called “bolt-on” acquisitions, as
for instance we have done this year by
acquiring Janco Oil Field Services (see article
on page 18). Talking about expansion of
scales, we intend to strengthen our position
in the fast growing trade lanes and to
improve our market position in areas where
the Group is relatively underrepresented.
As regards network expansion, we will keep
acquiring partner companies in strategic
countries to secure our direct control of the
customer base. And when it comes to
expansion of skills, we intend to further add
to and strengthen our capabilities in
selected industry verticals and in specific
geographic areas.
“Loyalty towards
an investment
which has always
proved very
profitable.”