Balkan expansion and a stronger focus on logistics: Waberer’s CEO reveals company’s plans

You can read this article in 8 minutes

Waberer's intends to increase its efficiency by expanding its logistics services as well as keeping its current freight model. This is precisely why Zsolt Barna, former director of the Regional Logistics Segment of the company, took over the management of the entire organisation earlier this year. Barna's goal is for Waberer's to become one of the leading logistics operators in Central and Eastern Europe. In this Trans.INFO exclusive, the Waberer's CEO sheds more light on those goals, as well as plans for expansion in the Balkans, and explains why Ukrainian drivers are needed.

Balkan expansion and a stronger focus on logistics: Waberer’s CEO reveals company’s plans
Waberer's

Under your management, the Regional Logistics Segment of Waberer’s has provided continuous growth. However, in the international transport segment, we have seen quite the opposite. One might think this appointment could be a drag on you. Is it?

No, it isn’t. This position means opportunities for me.

Waberer’s International is one of the largest carriers in Hungary – the successor of Hungarocamion, dating back more than 55 years. If we have to evaluate the last few years, the biggest challenge for our international transport segment was the price advantage that Waberer’s as a highly-efficient carrier used to have. This advantage has eroded due to other Eastern European carriers, who operated at lower cost. Over time, eventually this advantage deteriorated and then disappeared.

Therefore, the company was in a period of search in recent years; we were trying to find out what can make our international transportation successful again. At this point in time, it seems that we have found the way forward.

On the one hand, we have the trade-lane concept, announced last year, which focuses on serving Europe in a more efficient way. On the other hand, we want to increase the quality and complexity of our services. These two changes have meant better utilization and more pricing options for the fleet, thus improving its successful operation.

We are currently looking at how we can get better and add more value into the supply chain of our clients – and this path is already closely linked to our logistics services.

In order to better serve the needs of our customers, we have also significantly improved our fleet in recent months. We have done so in terms of refrigerated transport, tyre transport and ADR goods, as there is a significant demand for battery-related deliveries in the automotive sector. Moreover, we are trying to provide extra services to our customers to provide higher added value compared to market standards. By doing so, we can give our customers a significant competitive advantage when cooperating with Waberer’s.

This is a very exciting task and is much closer to the supply chain concept than the general carrier-corporate concept.

Specifically, what are your plans for Waberer’s business strategy in the near and distant future?

The change of director at the head of the company was a planned process and part of the group’s strategy. We have re-divided labour between the members of the managing board so that it can be subordinated to the goal of making Waberer’s the undisputed carrier and logistics provider in the region.

Based on our aforementioned strategy, Waberer’s activities and size will continue to grow in addition to the currently emphasized “commodity” type services, with higher value-added transportation and the development of our logistics services. Of course, we expect that this will further improve the company’s profitability as well.

When you refer to logistics services, does this include warehousing and warehousing technology?

Yes, it includes warehousing, distribution services as well as in-house logistics services. But road freight is also linked to all this too. We want to act as a bridge between the Western and Eastern European economies with our transportation services, but in such a way that our activities are better embedded in the supply chain processes of our clients through our logistics services.

Does this also mean that you plan to purchase or rent warehouses in other countries?

Yes, it could mean that. We now have warehousing areas primarily in Hungary and Slovakia, but one of our main owners, Indotek, supports us as a real estate investment company in strengthening our warehousing presence in the region.

The possibility of expansion in the Balkans was already raised by former CEO Barna Erdélyi in August. However, he did not provide any further details about it. What countries in the Balkans are part of your plans, and how big will the expansion be?

When speaking about the expansion in the Balkans, Serbia is extremely important to us. Indotek also has significant investments in logistics real estate in Serbia, and therefore there is a serious opportunity for Waberer’s to debut as a professional logistics provider in this region. In Serbia, according to our current knowledge, the kind of logistics market that can already be observed in Hungary has not developed yet, so we see an opportunity for expansion there now.

It is also a good opportunity to consider greenfield investments in this country with some of our current clients, as well as to contact smaller service providers already present in the Serbian market so as to look for possible acquisition opportunities.

Serbia may also be interesting in terms of its workforce. The Serbian workforce is very similar to the Hungarian one in terms of attitude to work and qualifications. Our presence in Serbia can thus be a good base for the company to grow and secure its workforce.

Speaking of expansion, Britain has accounted for almost 30% of Waberer’s international road freight portfolio. Has this changed since Brexit? What are your plans for the UK market now?

We want to maintain a healthy portfolio in the international transport segment, and the British market is a very important part of it. Waberer’s was able to successfully meet the challenges of Brexit, and so we were able to maintain this 30% share within our portfolio.

The UK and the growth opportunities in the country are really tempting – especially since a significant capacity demand has been generated on the market. We are negotiating with a lot of our clients for possible domestic services, but I still think we will primarily maintain the current division of our portfolio, in which, in addition to the UK, there are important markets like Germany, Italy and Spain. We do not want to change the proportion of these.

The latest financial report states that the company is “seeking colleagues for open driver positions from neighbouring countries to enable Waberer’s to provide a smooth operation to its customers”. Can you perhaps elaborate a little on this? 

The driver shortage in Great Britain and Europe has become the focus of headlines recently, and this shortage is also apparent in Hungary. At the moment, 12,000-14,000 drivers are missing. Not only Waberer’s, but also other Hungarian-based carriers are struggling with this problem too.

Although Waberer’s is trying to do everything possible to reduce the shortage – we have launched our own driving school, our own training course and our own test track at our site – we don’t seem to be able to source enough drivers for our plans. That is why we are mainly hiring Serbian, Ukrainian and Romanian drivers to compensate for the shortfall.

The extent of this need for recruitment from neighbouring countries depends on how successful we can be in employing Hungarian drivers. But since this is a Hungarian company, we mainly count on Hungarian drivers.

Waberer’s driver fleet has shrunk by more than 2,000 over the past two years. Are these drivers no longer on the market? Why do you need those drivers from abroad?

The number of Waberer’s International employees have indeed decreased in recent years, but the number of drivers working for the WSZL Group (which the Regional Logistics Segment of Waberer’s – the ed.) has increased  due to the aforementioned logistics services.

Neither should we forget to mention that foreign drivers did work for the company in previous years: 30-35% of the staff was not Hungarian. When the company had previously decided to downscale its fleet, it did not fire its Hungarian drivers.

Our current headcount is in line with the previous Hungarian headcount, but due to the shock caused by the pandemic situation, we had to understand that we could no longer employ our foreign colleagues because they could not travel across borders.

The current callback applies to them too.

Trending articles
Trending articles