JWD InfoLogistics PCL (SET: JWD) Chief Executive Officer, Mr. Charvanin Bunditkitsada discusses the company’s strategy and outlook in The Executive Talk by ShareInvestor.com.
1. What have you learned, and what opportunities have you found from the Covid-19 crisis?
Since the Covid-19 first appeared last February (2020), everyone has been in a panic. The logistics industry in Thailand and globally was almost frozen, especially in Q2. To cope with it, JWD, for the very first time, launched the Business Continuity Plan (BCP) to keep our operation going on track. We could not stop, because it would affect our customers. Since then, we have been executing BCP 4 times already. The most important lesson we have learned is that a business must adjust itself in order to survive. For example, we set up online meetings and interviews. But yes, there are always opportunities within every crisis. And chance belonged to those who adjusted themselves quickly. Covid-19 has uncovered rapid growth in B2C, Last-mile delivery, Online, and E-commerce business. They emerged even before Covid-19 hit the world. But because of the pandemic, the potential of this sector has never been better. Online trading has shown its high potential, just like traditional channels. JWD could see this trend clearly and started adjusting business even before the pandemic. For example, we signed a JV partner with our potential partners from many companies. We faced difficulties from travel restrictions within the region. However, JWD and our partners could find the solutions to get through them.
2. How do you adjust your business in response to the increasing oil price?
Years ago, when we were facing the swinging oil price, we kept the customers informed about this factor and the necessity that we might need to increase our service fee regarding the oil price. For the recent crisis, we admit that it significantly impacts our income and revenue. However, we have EV technology that JWD has already signed a contract with our Japanese supply partner. Thus, this February, we will launch the first trial of EV lorry in our freight. Moreover, we have cooperated with the Chinese partner to bring more EV trucks. Therefore, to achieve our ‘Green logistics’ mission and maintain the ESG policy, we must implement more EV transports.
3. Confronting the container imbalance.
This issue directly impacted our customers. I received an email from customers in Los Angeles explaining their difficulties in acquiring the containers from Thai suppliers, which led to their lack of confidence in trading with Thai companies. I clarified the situation and pointed out the problem’s actual cause, which was the consequence of imbalanced freight between large nations. Therefore, when it lacked supply, the freight price increased. But I don’t believe that the sea freight companies would take advantage of raising the freight price. So, it’s about balancing the freight account. Although these issues didn’t impact us directly, we took the opportunity to support our customers by providing temporary storage while the cargo was on the waiting list.
4. Business adjustment in the era of digital disruption.
Talking about digital means the backend or freight management system and the robotic technology that replaces human labor. JWD was the first logistics company to implement such technology and has been operating under an IT solution initiative for over ten years. Besides, we have also applied Business Intelligence (BI), such as providing a dashboard for the management team to oversee the operation in each unit. I also have my dashboard to receive daily income and revenue reports.
5. Generation gap management
JWD will soon turn 43 years old. We have a wide gap between the old generation who are almost retired and young new-graduated employees. With more than 2,000 employees, we brainstorm experience and know-how from the seniors with the enthusiastic, progressive juniors. I admit we have a strong HR department. Plus, we are the rising sun industry. While everyone has struggled with the pandemic, we still have acquired positive effects. Thousands of employees from other sectors were assigned to work from home, leave without pay, and even dismissed. We did none of these. Therefore, I believe our staff knows how lucky they are with the company’s position these days.
6. Investment in Cambodia and ASEAN
JWD has been expanding business to Cambodia for over five years. We operate three significant parts – first, food cold chain and supply chain management. We cooperate with the Cambodian partner who holds the Pizza Company and Swensens franchise. Second, we invest in the Phnom Penh special economic zone with an estimated 14.6 percent share. Lastly, the inland container port, located in Phnom Penh Special Economic Zone. They have grown quite well and just picked up from the Covid-19 impact. Especially these days, customers prefer inland transportation to the sea-freight due to the cost.
7. Logistics business is the backbone of the economy.
Yes, this is very important. As I said, no matter what crisis, all businesses seek survival. Logistics plays a significant role in supporting their backend, transportation management, storage management, air-freight, sea-freight, etc. Logistics cannot stop working. But of course, in a bull economy, we have a lot to do. The higher volume brings about a higher supply. Therefore, the increased competition is the customers’ stage of judging and bargaining the price and service. Logistics is an exciting business. Most of the time, we must decrease our costs because we profit from the customer cost.
8. Art Storage business.
Forty-three years ago, JWD started our first business in moving and relocation services such as home and office move, including exhibitions related to Art. A couple of years before the Covid-19 pandemic, we started the JWD Art Space, aiming to provide Fine Art logistics solutions, and cooperated with the Ministry of Culture. We see the pain point within relocation, import, and export of Fine Art. Some artworks have a high value. The collectors usually obtain numbers of artwork. Commonly, they hang them on the wall. However, when the amount of work has risen. Keeping these sensitive paintings in a common storage room will damage them long-term. I am personally a collector. So, I have found our potential in Fine Art management. We have an art specialist team who experienced more than 20-30 years in this industry. Customers relied on us. Besides, we also set up art exhibitions at JWD Art Space. One of our events received over 30,000 visitors, which means at least 1,000 per day. We have been delighted with the project. We aim to improve the art industry and introduce more Thai artists to collectors. We want to build a connection between them. Consequently, we never charged any entrance fees. Many students came here, and we see this as an opportunity to bring Thai artists and artworks to the global market.
9. What is your most potential challenge these days?
After Covid-19, I admit that JWD has performed exceptionally well. We have grown three quarters in a row. Therefore, my most potential challenge is how to develop further. How can we maintain our performance until the end of this Q4? While the Omicron seems threatening the economy and brings us an unclear scenario, how can we reach our next year’s target, especially the top and bottom lines? Can we grow as expected? These are our challenges.
10. We must not be proud of our past achievements.
I believe that as a listed company when we achieve something, others keep an eye on us. Because we are in the market and must work transparently, other competitors can always follow or imitate us – for example, cold chain management. Nowadays, everyone jumps into this service which I am very appreciative of. Thus, we aim to create new products regarding new trends, long-term potential, and sustainability. After that, the commercial team and I must pursue new products and services that could solve the problems for our customers, either B2B or C2C. We must admit that when there are many players in the market, profit margin and everything we did in the past will naturally decrease. Most commonly, they usually compete with price war campaigns. But, as a result, we must not stop and constantly search for new business opportunities.
11. What’s your inspiration for work?
My inspiration. I was only 29 years old when I first took the responsibility in this position due to my father passing away. However, my father’s goal to register the company in the capital market had inspired me. And I made it. Indeed, there are many things he wanted to do, and I have achieved most of them so far – just a few things to go.
12. What’s your goal?
My next goal is to grow JWD following our 5-year strategy as we announced to the investors and shareholders that we will reach 10,000 million THB by 2025. We are becoming a powerful regional logistics supply chain company, especially in Vietnam, where we hold shares in Transimex Corporation PCL. Moreover, we have received a 5-star CG score for two years in a row. We are one of the listed companies qualified in the THSI (Thailand Sustainability Investment) list. We were awarded the ‘Rising Star’ and ‘Best IR Awards’ from SET. We have been trying to transfer a family business into a logistics leader that everyone follows.
About The Executive Q&A Series
The Executive Q&A Series is presented by ShareInvestor, Asia’s leading financial internet media and technology company and the largest investor relations network in the region. For more information, email firstname.lastname@example.org. Website: www.ShareInvestorThailand.com