Interview: Logistics is a barometer of the economy
The beginning of the year is usually a time of taking stock of previous years. Although it might seem that after two years of covid nothing could surprise us, last year another blow came. And it was even worse - the war conflict in Ukraine. Unfortunately, hopes of stabilising society and markets were short-lived. In both periods, logistics played a very important, one might say indispensable, role. We asked Daniel Knaisl, Managing Director of the logistics company Geis, how he perceives the constant changes and increasingly challenging conditions.
How do you view the market situation and the mood in society? To what extent is it reflected in your industry?
There is general uncertainty in the market about future developments, and this is reflected in the behaviour of companies and individuals. Households have moderated their consumption, which was reflected in the first-ever drop in e-commerce last year. Businesses are struggling with rising utility costs, and on top of that, extremely high inflation is making almost everything more expensive. On top of this, there is also growing pressure to increase wages, precisely because of high inflation. At the moment, the automotive segment is in trouble again due to a supply shortage of certain components. The disruption in production by the car manufacturers is then further reflected in the activities of their subcontractors. All these events, including the ongoing conflict in Ukraine, are of course also reflected in the activities of logistics companies, which have to react flexibly and increase or decrease their capacities. The problem is that no one can predict future developments and planning is therefore very difficult compared to the past. All this at a time when there is still a huge shortage of qualified workers on the Czech labour market.
The war conflict and related inflation, fuel and energy prices and other negative consequences have brought and are bringing challenging situations to almost every company. How do you, as a large logistics company, cope with this?
Our advantage is not only our wide portfolio of stable clients, but also the fact that we are not only a carrier. We provide our customers with an A to Z logistics service, so we can partially compensate for a drop in one product with another service. One example is warehousing. There is still a severe shortage of space in the vicinity of large cities, warehouses are overcrowded and retailers do not have the sales they expected, they need to store goods. In addition, not all of our clients are doing badly, some are on the contrary strengthening even in these difficult times. This includes clients in pallet shipping, warehouse logistics and packaging, as well as those who ship with us from distant markets by air or sea and use customs services.
What did you manage to do last year despite the unfavourable development? In which area were you successful?
Despite the challenges mentioned above, our company did well last year. While we did not achieve our planned growth due to these obstacles, we view our 2022 results as very good. For example, we were able to achieve growth in the above mentioned warehouse logistics segment or in our packaging division.
Have you been able to invest in new projects and technologies, or have these expenditures had to be put on hold?
Our company remains ready to invest in the development of the company and the development of our products. Investments will also be made in new branches and the development of existing ones. We are also constantly moving in the areas of technology and software, which are key to our operations. We are also planning various projects in automation.
Despite all the problems, there is a lot of pressure for sustainable corporate behaviour and responsibility in this area as well. How do you feel about this?
Sustainability has been an issue for our company long before it was addressed with the intensity it is now. Across the Group, we are looking for different ways to help make our company even more responsible. There are many projects, plans and actual implementations. All of them are now covered by the MissionZero programme, which is the new sustainability strategy of the Geis Group. To name a few, I could mention alternative cleaner vehicle drives, better use of transport routes and loadings, tree planting, cooperation with schools and universities, emissions calculations, carbon neutral products, reducing our carbon footprint and much more. A current project of the Geis Group is not only testing, but the planned purchase of fully electric trucks. These vehicles are to be deployed on specific transports, including long haul.
What about CSR projects? Many charities are on the verge of closing down due to lack of funding and donor support. Logically, companies are left with little more than their own operations. Have you also had to suspend your support?
I am glad that we can support or personally participate in many charitable projects. The most important is probably the very close and intensive cooperation with the humanitarian organization ADRA - we often help people affected by some disaster (tornado, war in Ukraine). But we certainly don't stop there, we also support the blind with our own employee fundraiser, we cooperate with hospitals, we support the Avon Walk Against Breast Cancer and so on. I must not forget to mention that our employees are more or less involved in a number of projects, which makes me very proud.
Is low unemployment and a shortage of certain professions troubling your company? How do you solve it?
Yes, like other (logistics) companies, we are facing a shortage of qualified candidates for various positions. Apart from recruitment, the most important thing is of course that people are happy with us and have no reason to leave. So we solve this by prevention - we try to take care of our employees and keep them. And we do this in many different ways, including training and an extensive range of company benefits, as well as rewards for long-serving employees.
But young people and students are also important to us. We have long-standing relationships with schools across all countries in our region - the Czech Republic, Slovakia and Poland. Some students even try out working for us and it is not unusual for them to stay on after school.
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