"Leschaco will be focusing on new vertical markets, increasing its product footprint, and investing heavily in people and technology."

Martin Sack

REGIONAL HEAD – AMERICAS, LESCHACO

February 24, 2022

2021 was a year defined by global logistics challenges. Have you seen any signs that the situation will improve in 2022?

We expect logistics disruptions to remain a challenge for at least the first half of 2022, maybe even getting worse due to the spread of the Omicron variant across the globe. We have some expectations that the general environment might improve towards the second half of the year, but there remains a significant amount of uncertainty and we are prepared for another complex and difficult year.

When it comes to the impacts of the ongoing pandemic, Leschaco is well prepared to cover all its business and operations at the highest level. We are fortunate that we can work from home or in hybrid models due to adjusted processes, reliable visibility tools and our highly motivated and committed employees. What concerns us more are the essential and critical services of carriers, port terminals and trucking companies.

To what extent do you think the pandemic has highlighted the importance of specialist logistics services?

The relationship and collaboration between business partners has become even more important during the pandemic. You can´t go through this difficult environment on your own. Our business model was always built on trustful and personalized cooperation with our customers and business partners. Complex issues also require the highest level of expertise and specialized industry knowledge to reach the expected results. We have also seen a significant amount of new business coming in during the pandemic, as companies put more attention on qualified and reliable assistance.

If strengthening regional supply chains become a focus in lieu of global disruptions, what steps or investments would need to be made by companies and governments?

Strengthening regional supply chains is an ongoing and complex topic. Mexico, for example, has significant advantages when it comes to its geographical location. It also benefits from numerous international trade agreements. However, regretfully, the overall investment into logistics and additional infrastructure from both the government and private sector is not enough to take advantage of this opportunity. In other countries of the region, the situation is quite similar. For the Leschaco Group, the Latin American market remains strategically important. Effective February 2022, we will expand our footprint by opening a new organization in Peru.

How do you evaluate Mexico as a place to operate?

For Leschaco, Mexico has been an excellent market to grow its business, even throughout the pandemic. We have been able to achieve continuous growth due to a diverse product portfolio, customized services and the pure size of the market. With the recovery of the economy in 2021, we experienced an even bigger than expected increase in volumes. Mexico has a lot of advantages, especially due the country’s connection to the booming US market. We expect these opportunities to continue moving forward, where Leschaco will be focusing on new vertical markets, increasing its product footprint, and investing heavily in people and technology.

What role can the logistics sector play when it comes to helping supply chains reduce their environmental impact?

Global transportation has a significant impact on Co2 emissions. Vendor management, focused on reduced emissions, becomes every day more important. We need to choose the best partners that have a more positive impact in terms of sustainability. Our customers already have access to a door-to-door emission calculator. Consultancy and communication are important and together with customers we should discuss and review opportunities to reduce long distance transportation and improve overall logistics. Near-shoring, related to the current supply chain disruption, might also become another important factor to reduce the transport related emissions.

What do you see as the main themes that will influence the logistics industry in the coming years?

Digitization has been receiving more attention due to the pandemic and many companies are investing heavily in this area. However, we cannot move cargo only through digital solutions and human capital will continue to play an extremely important role. The complex logistics sector requires highly specialized people, and as staffing becomes more difficult around the world, we need to find new ways of attracting and retaining talent.

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