In a year that has been a roller coaster for many freight forwarders, one of the roughest rides has come from U.S.-based logistics firm UTi Worldwide.
As airfreight demand dwindled at the midpoint on this year, the red ink began spilling at UTi, including a US$70.7 million loss in the second quarter and a net loss of $104 million for the first half of the year. Recently, the 3PL said it will lower its fiscal-year projections of earnings before interest, taxes, depreciation and amortization (EBITDA) from the previous $125 million to between $75 million and $100 million.
In an attempt to right the ship, UTi has launched a plan to create revenue streams by offering customers more last-mile logistics services. One of these strategies is now being put to the test in South Africa, with the installation of more than 450 UTi “ByBox” shipment kiosks. Similar to the “Amazon locker” concept, the boxes give online retailers and customers a secure and convenient option for collecting and sending parcels.
“When shopping online, the customer simply selects the UTi ByBox delivery option instead of using a home address or P.O. Box,” said Greg Saffy, managing director of UTi Distribution. “When the purchase is delivered, the customer is notified by SMS or email and enters a code at the UTi ByBox to collect the parcel. Customers can also send parcels from the UTi ByBox using a prepaid UTi Pak in various sizes.”
The first UTi ByBox was installed at a service station earlier this year in suburban Johannesburg. More ByBoxes will be installed at various shopping malls, business parks and university campuses.
Keith Pienaar, president of UTi Contract Logistics and Distribution, said the UTi ByBox program is best suited for emerging markets, such as rural parts of South Africa, where there may not be convenient access to integrators such as FedEx or UPS, or there may not even be a physical address.
“We are committed to the success of the UTi ByBox and to providing this option throughout South Africa, where we have a leading market presence and a strong parcel delivery network already in place,” he said in a statement. “We will also be studying the deployment to determine its potential elsewhere in Africa and other emerging markets around the world, where UTi has special strengths.”
Get more air cargo insights at the 2015 Cargo Facts Symposium, Oct. 26-28 in Miami. Click here for details.