Cargo-partner Managing Director Anton Stoykov: Bulgaria Is Attractive Market for Freight Forwarding Companies
An interview with Mr. Anton Stoykov, Manager Director of cargo-partner Bulgaria for the "International Survey: Bulgaria-Austria" of Novinite.com (Sofia News Agency) and Novinite.bg.
What is the gist of cargo-partner's business activity in Bulgaria? What kind of cargo and freight traffic services do you offer?
cargo-partner eood offers the full range of logistic services such as air, sea, road and rail freight, multi-modal transport, warehouse solutions, distribution, cargo insurance, customs operations etc. We are currently a team of more than 40 young and motivated people and we take personally all tasks that our customers award us with.
You are an Austrian-based company that is active throughout Europe and globally. What is Bulgaria's place on your corporate map?
On the corporate map of course Bulgaria is a small dot, but a developing one. Currently all investments that we do are located in the Middle East and USA. So we are dealing on our own with very limited financial support from the HQ.
With great efforts and persistence we have achieved a growth of over 40 % in turnover and 30% in number of shipments in 2011 which has been noticed at the HQ and we are used as a positive example about how despite the crisis and the limited business potential in Bulgaria we still achieved a huge growth. For 2012 we have the same ambitious plan and are aiming at the same growth percentage that we had in 2011.
What are the Austrian management techniques and business know-how that you have brought into Bulgaria?
The Austrian management works with SOPs derived from more than 25 years of experience, according to the motto 'passion for excellence'. Of particular importance is the advancement in collaboration with the customers and the learning from each other. Furthermore, the management is based upon long-term sustainability for all stakeholders. These qualities are of highest importance and are brought of course into Bulgaria.
What are the trends that you see in transportation and logistics as far as Bulgaria is concerned? How have the cargo and freight operations that you handle been affected by the international economic downturn?
Bulgaria still seems to be an attractive market as we have seen a good number of new coming or returning international forwarding companies during the last year. The competition is huge and becoming very aggressive.
Alongside all big and well-known names there are hundreds of small and even "one man show" forwarders which leads to very slow increase of the freight rates and even reduction in some cases in comparison with the big growth of all related costs (fuel and different related taxes) This leads to a margin shrink and a lot more efforts in order to achieve the goals in regards of gross profit which will effect the final result of the company. In order to achieve this we need high productivity in our daily operations but unfortunately it is very hard due to bad software solutions plus the influence of some other external factors, such as those in connection to the mentality of the people in Bulgaria.
Where do you see Bulgaria's greatest advantages with respect to international freight traffic and logistics? What is its untapped potential? Which logistics and freight transportation sectors in Bulgaria have the most promising future?
There are more than 7000 registered transport companies in Bulgaria, one of the highest numbers in the EU and for sure among the top 3 if related to the number of the population. In Europe, maybe only Poland has a higher percentage.
So I see the biggest advantage in road freight - not only transports with starting or ending point in Bulgaria but also inner EU transport as well as cabotage. Bulgaria's airport and seaport infrastructure is very poor and the lack of investments especially in the sea ports put us in a very bad position in comparison with the neighboring countries and the port of Constanta, Thessaloniki and even Koper in Slovenia.
I also see some potential in the near future in rail transport regarding the project for a rail connection between China and Europe and the key location that Bulgaria has. Of course in order this to happen we need some radical change at the Bulgarian State Railways BDZ and its management and a lot of investments. No one can predict whether that will happen.
Building upon that, are there factors that prevent Bulgaria from taking advantage of its location and realizing its potential? Is it just the deficient infrastructure?
The infrastructure is the greatest problem of all. We all know this and I thank our Government that puts the greatest efforts on building up an infrastructure that simply does not exist at the moment instead of taking the populist decision to raise the retirement pensions for example.
In order to grow and develop we need a strong foundation and this foundation for every economy is the infrastructure. Everything else comes after that. After you have built up a steady foundation you can build up the rest in the way you imagine it.
What measures would you advise the Bulgarian Government to adopt in terms of policies in order to attract both greater investments from companies such as cargo-partner, and a greater amount of international freight traffic?
I am not at the position to advise the Government anything as they are the one who carry the burden of responsibility and not me. But I hope they will keep the same course in massive investments in the infrastructure.
At the end of the day we will see that this will pay off, we just have to be more patient. I wish also that the Government will have the will and strength to win the fight against corruption, can say that unfortunately at the moment they are heavily loosing it.
This government was elected with one of their top priorities being fighting the cancer of corruption but the results are disappointing at the moment. In all international analyses the prevalent corruption is mentioned as one of the greatest problems and this influences for sure the decision of international players for investments in Bulgaria. Another obstacle to beat it is the very unstable political situation - the ruling parties changing every 4 years and with this changing the ideas, policies, projects, administration of their predecessors.
Proponents of international transport corridors and logistics claim that if Bulgaria manages to develop proper port, railway, and road infrastructure, the freight fees it would get would be as important for the country's economy as foreign direct investments. What is your view on this claim, do you think it is justified?
Yes, it is justified, but before reaching this point there are a lot of actions to be taken, starting with the two mentioned in the above question. The real question is - do we want to get there? There are a lot of young and motivated Bulgarians who are eager to change the existing model that has been ruining Bulgaria for the past 23 years. Someone just has to open the door for them and this will pay off in the very near future. If not, this will remain only a good dream of "what could have been if..." in our imagination.
As a cargo and logistics operator, what is your company's special environmental policy? How do you go about being green?
cargo-partner's management has defined environmental responsibility as very important. The focus is on energy efficiency, waste prevention and waste separation as well as on the environmentally conscious use of operating resources at all subsidiaries. cargo-partner makes climate and environmentally friendly transportation technologies a subject of discussion and supports them.
The innovation package of cargo-partner ranges from fuel saving trainings for employees, a new building equipment and an increased utilization of transports to a shifting from air to sea cargo. Due to the improvement of the transports 19,113 tons of CO2 emission could be saved per year. This equals 2.7 millions liter of diesel fuel and 3.5 millions liter of ship-oil, in total minus 6.2 millions liter of fuel per year. Furthermore cargo-partner counts on E-Freight which substitutes the old paper Air Waybill for electronic documentation and supports the use of E-Cars.
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