The fashion industry has already shifted its activities to the Indian subcontinent, where low wages and a plentiful workforce (40% of the population is aged 15–30) attract labour-intensive industries to India, Bangladesh and Pakistan in particular. At the same time, the region, notably India and Bangladesh, has boosted its pharmaceutical industry which today manufactures generic medicine on a large scale for export and to meet the increasing domestic demand.
Domestic growth in India has been kindled by the rapidly increasing population and annual real-wage increases of more than 5%, and the Indian economy has also seen annual growth rates of 6–10% over the past decade. This makes it one of the world’s fastest-growing economies and the fourth largest in the world – soon to overtake Japan and become the world’s third largest economy after the US and China.
After the acquisition of UTi, DSV decided to make the Indian subcontinent an independent region. Considering the enormous potential,
I believe this decision is both appropriate and forward-looking, says Sameer Khatri,Regional Director, Indian Subcontinent & Managing Director, India.
Doubling the number of offices
While Sameer is responsible for the Air & Sea organisation, his colleague, Hariharan Sivaprakasam, with the title of Director, Contract Logistics & Distribution India, heads the Solutions division, including a good-sized Road organisation, that primarily services warehousing and logistics customers. Sameer and Hariharan have a history of 4.5 and 5 years, respectively, as successful top executives of the former Indian UTi organisation.
Sameer Khatri, 46, head of DSV Air & Sea on the Indian subcontinent, which comprises India, Bangladesh, Pakistan and Sri Lanka.
The merger with DSV doubled the number of Air & Sea offices from 9 to 17 locations in the largest business districts and manufacturing hubs. The previous cargo handling volumes were 15,300 tonnes (Air) and 30,000 TEU (Sea), but this has now increased to 52,777 tonnes and more than 68,000 TEU.
Sameer Khatri envisages huge synergies in the combination of the two organisations, both in terms of staffing and commercially speaking.
“UTi was strong in exports, and DSV is strong in imports. UTi’s business was developed with a focus on local corporate and SME companies whereas DSV received most of its business from its network. Today, we have a robust platform for servicing small, medium-sized and multinational customers alike,” says Sameer who has also taken note of DSV’s young team of employees, solid procedures and strong global networks.
Combined with UTi’s larger presence in the area and skilled employees with local knowledge, both in terms of operations and sales, this leaves him full of optimism:
It’s one of the most brilliant examples of how youth and experience can be mixed to create a far stronger organisation,
High global standard
Just like their colleagues in Air & Sea, the acquisition of UTi gave DSV’s previous Solutions activities in India a massive boost, after having separated the Solutions division from Air & Sea in 2012 and 2013 – first operationally and then in terms of the business. The division has since experienced revenue growth of 40% a year, and according to Hariharan Sivaprakasam, who orchestrated the transformation, there is now a great momentum with existing and new key accounts: Ford, Legrand, Faurecia, Welspun, Kellogg’s, Oxford, LM Wind etc.
Hariharan Sivaprakasam, 36, has been responsible for building the Solutions division for UTi in India over the past five years. Today, he heads the combined DSV/UTi Solutions activities – and there is momentum, he says.
“We have repeatedly seen how contracts in India change hands every three or five years due to insufficient focus on service excellence, quality and safety. So we have invested great efforts particularly towards providing this and we aim to be one of the top five in India within a few years to reflect DSV’s global position,” says Hariharan, adding that a higher ranking could be expedited by a well-placed acquisition in the country.
Maximum responsibility for the country manager
According to Hariharan, the integration of DSV and UTi globally was “swift, methodical and comprehensive” with a view to maximising value for customers and internal profitability – and minimising unease among the staff.
After completing the transaction in January, Brian Ejsing (CEO, DSV Solutions) visited the region to taker a closer look at the newly acquired Solutions footprint.
This time, the destination was not India but Taiwan where Hariharan met with the top executive. One aim was to present the activities in India, but the main purpose was to get the go-ahead from the division for the construction of a 20,000 m2 facility for Faurecia in Chennai. Faurecia is a leading supplier in the automotive industry to whom UTi provides both Just-In-Time and Just-in-Sequence solutions.
Within a few days – following relevant financial and legal clarifications – the warehouse was approved by Ejsing and the executive board.
This really showcased the speed in decision making for a large company and the approach of empowering the country management with maximum responsibilities coupled with accountability on the results,
With the acquisition of UTi, DSV India can now offer all the disciplines of the trade, including air and sea freight, warehousing and in-house logistics, road transport, free-trade-zone services, not to forget a brokerage license.
We are one of the few multinationals that offer in-house customs brokerage in the Indian market, and it gives us a foot in the door of the largest companies – in India as well as globally,” says Sameer Khatri, who is also a member of the Air & Sea Executive Board. “Giving the Indian subcontinent a position on the executive body of Air & Sea helps direct attention to the untapped potential of our region. At the same time, the company gains insight into a market that may be difficult to understand for many businesses,” says Sameer Khatri who is very pleased – and
honoured – to be part of an organisation that appreciates “merit and diversity”.
Hariharan Sivaprakasam has the last word: “DSV and UTi are two highly compatible companies with a shared historical focus on customer-oriented solutions and sound entrepreneurship. In addition, DSV has a strong financial focus and the ability to manage the company with a lean central organisation – which translates into a sound bottom-line. I don’t see or feel any major difference between UTi and DSV, which is probably why it has been and will remain a really sensible acquisition”.
Combined DSV Air & Sea in India
USD 173+ million revenue
Airfreight: 52,777 tonnes
Seafreight: 68,121 TEU
Combined DSV Solutions in India:
USD 13,4 million revenue
75,584 m2 storage and logistics facilities
Read more about our services in India