Freight Consult Ghana Limited is New Silk Road Network’s first member from Africa. In an interview with Mr Abdulai Pangasur, the Managing Director of Freight Consult, our pre-conceived notions about doing business with companies in Africa were exonerated as we discovered the broad set of possibilities in expanding the New Silk Road in the region.
Mr Pangasur had a broad and in-depth experience of working in the field of logistics, starting as early as his school days when he worked in a warehouse, to owning his own business and establishing Freight Consult as a premier company in Ghana, West Africa. In our conversations, we touched upon the growth of his company, the lack of understanding Africa’s business culture and the prospects of the New Silk Road in Africa. He also shared news about their upcoming ventures and the severe need for digitalisation in the wake of the coronavirus pandemic.
In conversation with Mr Pangasur…
NSRN: Freight Consult was established in 2006, and since then has established itself as a reliable forwarder offering cost-effective solutions. Moreover, the company has a strong network of affiliate offices in different countries, such as the US, China, UK and Dubai. What has been the history of the company and the formula behind its successful growth?
Abdulai:As you rightly put it, Freight Consult has been operational since 2006. I had been a freelance agent in Ghana long before that, starting as early as my school days. My schooling was done in Cape Coast, at the time my father worked in security for a warehousing company in Accra. I used to join him there and worked as a loader in the warehouse. I had finished my A levels then and was waiting to start university. The boss over there noticed that I had a good education and encouraged me to take up tallying for air cargo. Soon, I had finished my first IATA certification and continued to work in the logistics field, along with pursuing my university studies.
I got licensed as a customs broker in 2006 and started Freight Consult after receiving the license from Ghana customs for in-house customs agents. Apart from our customs practices, we wished to branch out services towards the corporate industry in Ghana. As we were only conducting forwarding for the public in Ghana, I decided that it would be far more rewarding to target the corporate sector, specifically the mining industry. So, we picked up a few clients from the mining sector. One of the driving factors to gain these customers was our reliability. They wanted to have a stress-free delivery to their mining sites because there were issues with clearing and forwarding in Ghana. It used to be a bit more cumbersome then than it is now. Also, we adopted digitalisation, so the processes have become far smoother. We also worked with automobile companies and pharmaceuticals as well. It was our motto to offer a stress-free service to our customers.
Traditionally, in Ghana, forwarding agents would rely on their clients to pay upfront for their deliveries. However, when we started, we decided to partner with Stanbic Bank in Ghana. We received a form of Escrow payments facilities to embark on providing the total logistics package for our clients. When we first went to them to present our strategies, it was a little bit risky for them to take it up, because one usually has to pay the duties on behalf of the clients, then you deliver the cargo to the client. Accordingly, you have to wait for the agreed terms to be paid.
This was critical for us because it allowed us to deliver within our own KPI. If we had to go to the clients all the time, asking for the payments of various charges, then we wouldn’t have the control of the KPI. Most of the industries that we worked with, we told them that we would be able to deliver within record time. They didn’t believe us at first (laughs), but then to do 48 hours from sea-port or 24 hour delivery for air freight was remarkable for our clients. The news of our capabilities caught up with most of our corporate clients. Also, our continuous search for strong global networks such as New Silk Road Network has helped us. Our first network was the TIACA, based in Florida. From there we also joined to IATA, FIATA, BPD International, and now we are also with NSRN!
We started our office in Baltimore, in the US back in 2017. Now we realised that within the areas of Baltimore, Virginia and Maryland, we have a massive concentration of African immigrants, especially from Ghana. What we wished to do was start the door to door service. We rented a warehouse, we also had packaging service, for people who wanted to send stuff back home to Ghana. We also have a partner office with an associate company in Dubai. In China, we have various partner offices in Shenzhen, Chengdu and Guangzhou.
NSRN: If you could only pick up to two aspects, what would you say is Freight Consults core competence area in terms of transport and commodities?.
Abdulai: Firstly, our ability to understand the core demands of our customers, making sure that we put together the various aspects of our operations to meet that demand. We try as much as possible to be looked upon as a reliable Logistics partner in Africa. The reason I say that is because we have clients like the Chinese telecom giant Huawei. We are their main agents not just in Ghana, but also in Liberia and Sierra Leone. This came about as a result of our reliability. We have been working with them since 2015, and I can confidently say that we are their only agents in Ghana right now.
We also do some inbound freight on their behalf, using our partner agents in China. I hope in future we can tap into the New Silk Road and get more business from Huawei in China. So, I can say that our core competence is primarily our reliability and our credibility. These are the two abilities that have given us a strong customer base.
NSRN: Naturally, news of the Belt and Road Initiative must have caught your ears. How has the launch of this initiative influenced your business in any way? What is the interest that African businesses have in working along the New Silk Road? Are there any challenges that you face when it comes to doing business with China?.
Abdulai: I was just talking about this the other day, and I said maybe the attention of the New Silk Road should now move to Africa as well. Mostly in Africa, our economies are import driven. Today, I can say that 60-70% of the import volumes come from China. So, China is an essential partner to Africa and particularly for Ghana.
Considering many instances in Project Cargo, you see that most European contractors win the contracts even when the project is in close proximity to Africa, instead of a direct import to Africa from China. We see the link here, with the New Silk Road, to be able to handle project logistics along this route as well. Even though the Silk Road doesn’t enter Africa directly, we see that kind of link. We think that we in Africa have placed at ourselves at a level where we believe we can handle some of the projects going from China to Europe.
I think the interest for African businesses in the Silk Road project is quite enormous. First is to create the link for an inter Africa and Europe partnerships looking at the Chinese markets. The business links that would be created as a result of the inter Europe and Africa relationships will be significantly enhanced through this network.
The challenges while doing business with China would mainly be linguistic differences. I think there is a need for Chinese companies to know that every region has its own linguistic capabilities. Another problem is the time zone difference, sometimes people are unable to work with companies in Africa. We here need to understand that the time zone differences with China. Finally, Africa and China need to understand each other’s business cultures. I think this can be through partnerships with Chambers of Commerce at the governmental level, or maybe even cultural exchange programs.
NSRN: The African market is traditionally considered as very challenging for many logistics companies outside. What do you think is the key ingredient in operating there? And what are your recommendations for companies who wish to develop business towards the African continent?.
Abdulai: When people talk about Africa, people need to understand that Africa is very fragmented and very vast. There are so many different languages and different contexts. It is diverse in terms of landscape, culture and traditions, beliefs, tastes and preferences. Due to these reasons, people need to first understand what part of the continent they are dealing with.
Start with knowing what language they speak, we have Portuguese, French, English, Arab, and so many other languages. It is an enormous market, but still untapped—the only untapped market left in the world, apart from some south Asian countries. The central aspect is to understand the dynamics of each country that you are dealing with. When you come to Ghana, for instance, you must know that we are an English-speaking country with a stable democracy and economy. Our economy is doing well, and it is an enabling environment for business. Even though we are surrounded by countries that are facing troubles, Ghana has been stable for a long time. We are the gateway to doing business in West Africa. Let me give you an example here. Cummins, a leading multinational company that deals in engines and generator products set up a Regional Distribution Center (RDC) in Ghana, to import their products for onward distribution in West Africa. We handled clearing and forwarding for their RDC for three straight years. We also handled imports from Belgium with our partner BDP international, all the way to Accra. We did weekly transshipments to other West African countries.
In the case of Nigeria, it is a vast market, but it has quite a challenging business environment so most logistics companies who want to enter into the Nigerian market, most of them come through Ghana. Ghana is used as a springboard for business. This situation is primarily due to political instabilities and the unstable economic condition caused by acute corruption. So companies must take time to study the location and understand the unique characteristics before conducting business. You must also see if the company is well gazetted or licensed, and how reliable they are in terms of the delivery of services. We have a robust database in Ghana that helps us to verify such details.
NSRN: What are the future developments taking place in Freight Consult, and what are your expectations for the next few years, considering how the coronavirus pandemic has affected the world of the supply chain? .
Abdulai: We have a few developments taking place. First of all, we are starting a campaign to target the oil and gas industry. Ghana has become a significant exporter of oil and gas. We feel strongly that the available contracts would be good for us. We intend to take this up next year. If you ask us about the coronavirus and the supply chain industry, we learnt that it is so important to rely on technological developments. We have been at the forefront of digitalisation. We believe that the current way of doing things is to move away from the analogue and adopt digitalised systems of operation. We have set a program to launch a new product next year called FC Xpress, a courier services app. The app is actually developed in the line of Uber’s system of operation, instead of passenger bait, we offer cargo bait. We have tested it; we will have it on the App Store and Google Play soon. We are going to launch it next year and roll it across all the regions in Ghana. As a result of the coronavirus, we have come up with this product. We can still serve people without having their physical presence. We can be called and asked to deliver cargo anywhere. We are targeting general cargo, mainly. We are also trying to start FC Xpress from Dubai and London. The service in London will take the opportunity of the flight run by British Airways, every day of the week, as we have space in their carrier.
For instance, if you would like to send a mobile phone to your relative in Ghana from England, you can just drop it in our office and then we will deliver to their door. We don’t want to do oversized packages, preferably small packages, such as medication etc. The average delivery time for most service providers from England to Ghana is 9 days, that’s the best time they can offer. However, we guarantee 45-78 hours. We will provide genuine express delivery as of 2021 and we are very hopeful about our upcoming developments!