Aras Cargo, one of Turkey’s leading domestic express parcel companies, expects to grow stronglythis year despite the economic crisis and is interested in an alliance with one of the integrators,
its CEO told CEP-Research in an exclusive interview.Aras Cargo increased revenues about 15% in 2008 by focusing on profitable business, ZiyaGündüz, CEO of Aras Holding and General Manager of Aras Cargo since last summer, said in aninterview in Istanbul last week. He did not disclose the absolute revenue figure. Theprivately-owned group, founded 30 years ago, competes with Yurtici Kargo to lead the domesticmarket ahead of third-placed MNG Cargo and smaller rivals. The integrators, DHL, TNT, UPS andFedEx, focus mostly on the international market to and from Turkey.
This year, the company aims to increase revenues by 25% – 30%. “We will do this by sellingniche services, more added-value services and generally winning more business,” he said. “We willfocus more on SMEs and retail business,” he said. The company will offer new innovative servicesand continue to concentrate on profitable volumes, he noted. Revenues were already up 20% inJanuary compared to one year ago despite the crisis, he pointed out.
Since taking over as CEO, Gündüz has split off various specialist businesses, includingcourier delivery, groupage transportation and logistics, into the Fillo subsidiary to develop itinto a “boutique logistics” provider with revenue of some $100 million and about 1,400 staff.
The main parcel delivery business, Aras Cargo, with some 7,000 employees, was restructuredwith the closure of about 70 of the 800 shops and six district offices. The company also aims toreduce the proportion of owned vehicles in the 1,400-strong fleet to below half. Aras Cargooperates a nationwide network with 27 hubs.
Looking ahead, Gündüz said: “The business model for the next five years is to double thevolumes but the most important thing is to quadruple the profits.” The aim was to increase theprofit margin from a single-digit to a double-digit level and to improve the return on investment. “ Very shortly we will appear in a much better shape and appearance.” The medium-term target isrevenues of $800 million by 2015.
Referring to industry speculation that the company, whose founder died last year, might beup for sale, Gündüz stressed: “The shareholders are not thinking about selling. They want to retainit in this structure and they want to grow internationally.” Neighbouring countries in the Balkansand the CIS region were possible new markets, he said.
“The only potential alliance would be a joint venture with an integrator who wants to enableus to grow,” he declared. “If an integrator comes to us and would to like to share their regionalgrowth with us, why not?”
Aras Cargo currently cooperates with DHL Express for its international volumes and alsoprovides domestic distribution for DHL.
