The LogiPoint Legacy: Enabling SA’s Supply Chain Industry
LogiPoint was established in 1999 with the objective of leveraging the economic potential of the Red Sea Port of Jeddah to create a logistics and supply chain hub in the region which would cater to the future needs of the Middle East’s largest economy. Today, LogiPoint is at the forefront of driving innovation and change for greater economic growth of the region.
Saudi Arabia is the largest of the GCC nations and contributes more than half the region’s GDP. As the world’s largest exporter of oil, and boasting the world’s third largest reserves of natural resources valued at over US$ 34tn, it is one of the richest countries in the world and the most robust and vibrant economy in the region. It is also the most populous of the GCC nations, and boasts one of the youngest populations in the world.
Geographically, the Kingdom enjoys a unique strategic importance straddling the global shipping routes through its ports on the Red Sea Gulf in the West and on the Arabian Gulf in the East.
Propelled by the revenues from its substantial oil and gas exports, the Kingdom has grown at an exponential pace over the past few decades, and is poised for accelerated growth in the coming years as the Government invests heavily in diversifying away from the oil economy. These investments are expected to usher in another round of rapid industrialization and development of the Kingdom’s mammoth manufacturing, transportation and service infrastructure.
The Government has laid out an ambitious growth plan for the Kingdom in the form of Vision 2030, which is a comprehensive blue-print for unprecedented and extensive investments in large-scale industrial plants and mega projects in energy, power, utilities, transportation, and telecommunication. At the center of this vision is the idea that trade and commerce must thrive and the Kingdom’s substantial human capital must be utilized for the nation’s growth through investor-friendly incentives and policy reforms.
Saudi Vision 2030
Saudi Vision 2030 makes Logistics and Supply Chain one of the pillars of economic growth and development in the Kingdom. It has thus become imperative for the stakeholders in the industry to chalk out their own strategies and paths in such a way that they play their respective roles in attaining the Vision 2030, which envisages the Kingdom as becoming a global logistics hub in the years to come.
For centuries, Jeddah has served as the gateway to the hinterlands of Hijaz and Najd, the Western and the Central regions of the Kingdom. In the first half of the twentieth century, with the discovery of oil and the revenues from it, the Kingdom took an accelerated path to rapid growth and development, and quickly grew into a robust demand-driven economy powered by extensive public expenditure and mega projects. This, in turn, attracted millions of foreign workers on the one hand, and built the capacity, on the other hand, to host tens of millions of pilgrims every year. Jeddah benefitted directly from this dual windfall and evolved into the Kingdom’s commercial and cosmopolitan capital. Jeddah Islamic Port found itself thriving at the confluence of marine trading routes between the East and the West while catering to bulk of the Kingdom’s burgeoning demand.
Over the years, acting as the commercial hub and the principal gateway to Saudi Arabia, Jeddah and its deep-sea port, Jeddah Islamic Port (JIP), have been instrumental in shaping and boosting the country’s development. By the turn of the century, the logistics landscape of the Kingdom was ripe for the birth of what was until then an untested concept in the Kingdom – a Bonded and Re-export Zone (BRZ) to facilitate value-creation via a more seamless flow of goods and cargo through the Kingdom’s premier port. The Kingdom’s first and the largest BRZ, LogiPoint was born formerly known as TUSDEER.
As an indigenous, home-grown corporation, LogiPoint is inextricably linked to the evolving logistics ecosystem in Saudi Arabia. The company started out as an enabling platform for the logistics and supply chain industry in the Kingdom. It did this through providing the much needed bonded facilities and the value added services in the BRZ, but more than that it did so by acting as a liaison office amongst the many stakeholders in the industry, which included the regulatory bodies, the port authorities, and the customers, to help provide a collective understanding of the changing needs of the industry. In this manner, LogiPoint acted as a catalyst for innovation, efficiency and growth across the industry, and evolved to become the leading provider of next-generation logistics solutions in the Kingdom.
Internally, LogiPoint have invested constantly in gaining an ever-deeper insight into the needs of their customers as well as the requirements of the industry service providers and stakeholders. This has enabled them to anticipate the changing needs of the market and to develop strategies and build solutions which create greater value for their customers. LogiPoint have implemented automation and technology-driven innovations in business processes that make their services more customer-centric, more efficient, more scalable and thus more sustainable. These investments have also resulted in a significant increase in effectiveness, efficiency and productivity in their workflow. The company’s mission is guided by the principle that resilient supply chains are built through a flexible and dynamic relationship between the various stakeholders and that this is achieved through a constant commitment to transparency, reliability and second to none quality.
In addition to building and operating the Bonded and Re-Export Zone, a one million square meters logistics zone located within the premises of Jeddah Islamic Port, LogiPoint operates a network of integrated logistics parks and zones in the Kingdom, and thus by catering to an ever-expanding spectrum of clientele is helping transform the logistics landscape of the country.
The multi-award winning LogiPoint is a subsidiary of Saudi Industrial Services Co– SISCO, a joint stock company listed on the Tadawul, the country’s Stock Exchange.
With the aim of expanding its portfolio across the Kingdom, LogiPoint plans to invest considerably in developing various new state-of-the-art Logistics Parks and Economic Zones, while completing the ongoing construction projects in The Logistics Park (Modon Jeddah) in 2021.
The LogiPoint warehouses are fully equipped with sophisticated features such as: round-the-clock temperature monitoring with remote alert and battery back-up; redundant HVAC systems to ensure continuous operation; security systems with 24/7 video surveillance and alarms; epoxy-sealed floors to ensure dust-free environment; full GMP and GDP compliance; pest control procedures; quality control processes and many more.
Thanks to rapid industrialization in the Kingdom and an impressive track record of delivering reliable solutions of the future, the company is witnessing heavy demand for its warehousing solutions, both for the ‘Pre-built’ and for the ‘Built-to-Suit’ facilities. In addition, new buildings of about 55,000sqm are being built, which will be ready in 2022 and for which the bookings are already pouring in.
One of the landmark new services that LogiPoint introduced last year was the cross-border multimodal movement for shipments into the GCC.
Shipments originating in Europe and the Americas, and passing through the Red Sea, typically have a transit time of 8-12 days to finally reach their destination GCC ports in the Arabian Gulf.
These East-bound shipments from the Western origins can now be discharged in Jeddah and moved to their final destinations in the GCC via bonded trucking.
This helps reduce the transit time for the imports into the region by approximately 7-10 days and introduces unprecedented efficiencies for the regional logistics sector thus creating real value for the importers of fresh produce and perishables as well as other time-sensitive cargoes. On the flip side, West-bound shipments originating from the East can now be discharged at the regional ports in the Arabian Gulf on the East, and moved under bond to Jeddah for onward multimodal movement to final destinations in Africa, Europe and the Americas.
The regional exporters can now avail these value-added services to serve their export markets in the MENA region and beyond when they use LogiPoint as their regional logistics hub. LogiPoint is constantly re-evaluating its value-added services for its clients to see how it can bring greater new efficiencies, cost savings and better profits to their business and the cross-border trucking product promises to be a game-changer in the region’s logistics.
Export Distribution Hub:
Petrochemicals constitute the Kingdom’s dominant export, with hundreds of thousands of high-value containers exported annually to destinations all across the world. The highly competitive world of petrochemicals depends very heavily on speedy delivery of large volume shipments. In the past, this had proven to be a challenge, and the Petrochemicals majors had had to rely on international transit hubs to maintain proximity to their end customers.
In a major milestone accomplishment, LogiPoint recently concluded a key agreement with Aramco Chemicals Company (ACC) to become their cost-effective and scalable international logistics hub within the Kingdom. This was achieved through re-engineering the export process with extensive support from Saudi Customs, Saudi Ports Authority – MAWANI, and Jeddah Islamic Port.
The agreement helps eliminate the need to use an intermediary overseas hub for storage and onward shipping of ACC’s cargoes thus enhancing their ability to provide cost-effective solutions to the end customer. The cargo is now dispatched directly to the target market, ensuring greater efficiency through reduction of the export processing time from one week to one day, thereby increasing the demand and appeal for Saudi products.
Sea/Air and Air/Sea — Multi-Modal Transport:
The central and strategic location of the Kingdom lends itself to Sea-Air and Air-Sea logistics. Realizing Saudi Arabia’s immense potential as the multimodal hub through which a seamless Sea-Air and Air-Sea solution could be offered, LogiPoint collaborated with the regulatory bodies and the industry stakeholders to build a Bonded Multimodal Corridor between the Jeddah port and the Kingdom’s airports.
Following the initiatives taken by LogiPoint, it is now possible in KSA to import a shipment by sea in the first phase, move it under bond to the desired airport, and then dispatch by air freight to its final destination.
Similarly, air-freight imports can be moved to the LogiPoint Bonded and Re-Export Zone for consolidation before being shipped out by sea. This successful multi-modal transportation model is an important and ingenious development in putting the KSA on the world logistics map as a strategically located multi-modal logistics hub.
Bonded Express Facility:
The COVID-19 pandemic has brought about a seismic and irreversible shift in global business trends. Part of that shift is the unprecedented boost for the e-commerce and the express delivery segments. Both these segments rely heavily on timely delivery of orders via efficient, error-free, and high-speed logistics. LogiPoint recognized the need for a next generation logistics infrastructure built with the specific needs of these two industries in mind and set the ball rolling even before the world found itself grappling with the fall-out from the pandemic.
This is how LogiPoint introduced the Bonded Express Facility to cater to the express delivery industry and the e-commerce segment. The LogiPoint facility is the first of its kind at a Saudi Port and is dedicated to ensuring the speedy clearance and fulfillment of express parcels and e-commerce shipments. Through policies and processes designed with e-commerce needs in mind and an infrastructure built around the design, the facility handles and facilitates inbound and outbound express shipments by sea, air and land. It also enables the e-retailers and the online platforms to reliably serve their target markets in Saudi Arabia and in the rest of the Middle East.
These initiatives have already led to signing of groundbreaking contracts with global e-commerce giants Amazon and with regional and national industry leaders like Aramex and Naqel among others.
Value Added Services:
Over the years, LogiPoint have been offering a wide array of Value-Added Services (VAS). These include short-term storage, packing, co-packing, labeling, bundling, and distributing goods, duty deferment (important especially when VAT has become such an important part of costing for a supply chain), and clearance and delivery support.
There is also the Reefer Village, which boasts a Reefer Container Yard with 240 plug-in points, reefer cross-stuffing stations, and an ever-expanding fleet of trucks and gensets.
With an eye to the future, LogiPoint have invested into becoming operators of Logistics Parks and Economic Zones in the Kingdom and beyond. Jeddah Logistics Hub in Modon 1, Jeddah and the 314,000 sqm Logistics Park, South Jeddah in Khomrah are two examples of such investments, which will help create thousands of jobs directly and indirectly.
Additionally, there are exciting new projects in the pipeline, which will see LogiPoint expand their footprint across the Kingdom through strategically located new Logistics Parks and Economic Zones.
LogiPoint is committed to developing Jeddah and the Kingdom into the region’s foremost multi-modal logistics hub serving the global trade. In terms of life cycle, LogiPoint is only at the beginning of its journey, and is very well-poised today to play an ever-greater role in nation building and development.
View From the Top
Farooq Shaikh is the CEO of LogiPoint and laid out the way forward for the company clearly: “We see our role as enablers of trade and commerce by becoming a leading logistics hub in the region, one which creates real and tangible value for our clients in every step of their supply chain logistics. We will look to expand our portfolio across the Kingdom by investing in themed logistics parks catering to specialized segments of the market. LogiPoint’s focus will remain on offering second-to-none, high quality products and services to our customers by investing in the capacity and the IT infrastructure we need to meet the needs of the future”.
He underlined the role the company has played in nurturing the logistics eco-system in the Kingdom: “LogiPoint’s contribution to the Saudi market has been remarkable. Twenty years ago, when it commenced operations, the bonded zone was an unfamiliar concept to the logistics industry in the Kingdom. Today, the industry is able to plan, develop and deliver highly sophisticated logistics solutions to the market because of the initiatives the company has been pioneering and introducing over the years. In this way, we have attracted extensive new investments into the Kingdom, enabling the supply chain and logistics industry to offer cost-effective and efficient services to the market. ”
Dovetailing Saudi Vision 2030
LogiPoint continue to see their role as one of making active contribution to the ‘Saudi Vision 2030’ through enabling the logistics and supply chain industries as well as the Saudi Exports facilitation
LogiPoint is committed to enable Saudi non-oil Exports and the logistics in the region by going the extra mile in designing unique and innovative solutions for the logistics industry. “We work intimately with our clients to understand their needs, requirements and pain-points. Through this interface we identify, examine and build organic solutions that facilitate streamlined and seamless work processes,” explained Rayan Albakri Deputy CEO at Logipoint.
“Service, commitment, involvement and facilitation are part of the LogiPoint DNA and through our engagement with our clients, with industry stakeholders and with the help of our resources and experience, we excel in offering solutions that enable the smooth passage and timely delivery of consignments,” he asserted.