APL’s Strategy towards China

Accompanying with the eastern-forwarding of the global product-manufacture’s bary center, China has become the key one among all the important players. There is no doubt that the Chinese Shipping Market is one of the most attractive shipping markets in the world and to all the great shipping enterprises it is worthy to enter and participant. In fact, none of the international shipping enterprises would lose the golden chance to business in China. They all cast their sights in China and are ready to fight for their territory. APL is one of them.

APL and APL logistics are all from the world-renowned international transport and logistics group, NOL. Headquartered in Singapore, has business in 140 countries in the world and as one of the global ten liners, NOL’ s container transportation business is totally in hand of APL. APL provides over 60 lines in more than 90 ports in the areas of Asia, Europe, Middle East and Africa and it also provides 300 times per week for dock berthing. And with the cooperation of its sister company APL Logistics; APL has formed the first-class multi-transportation operation, the top information &e-biz technology,

As the founder of multi-transportation, APL’s creative spirit arouses people’ s delight when talking about it. Its developing strategy in China also attracts many attentions in the industry. In order to acquire more about APL, the reporter has taken an interview to President Zheng Weiren, President of APL, China.

Charms of the Chinese market

R: At present, more and more enterprises pay their hot sights to China and would like to have their own market’s shares in China, What do you think of the Chinese market?

Mr. Zheng: The goal of APL is to be the best shipping companies in Chinese market. We have 140 shipping experience in China and will make efforts to do the further development as we are doing all these years. At present the operators are gathered at the coastal areas of China and along with the extension of the supply chain to the inner land of China, the inner land market will become hot. APL will consider all kinds of methods to explore the inner land market, e.g., to cooperate with Chinese enterprises.

But this doesn’t mean that will affect our quality. The thing we value most is our brand. We have to make sure that when carrying out this business, the service quality will not be worse and the service excellency will not be affected since our clients from every corner of the world put great expectation on APL.

R: Now what is the business occupation of the Chinese market in the global market?

Mr. Zheng: About the percentage of the business occupation, I do not want to deliver any comment on the detailed conditions. But what I want to point out is that the Chinese market is very important to us with the strategic meaning. We also hope to further expand our obligation in the Chinese market. Nowadays the Chinese market has become the key part of our global business and will be the key part in the future’s development. What’s more, we will extend our Chinese business’ market share of the global business in the next years.

In fact we pay great attention to the Chinese market. Recently an investment of $1 billion for booking a steamship is pointed to the Chinese market. And the investments will keep rising state in the future.

R: What are the difficulties in front of APL’s development in China?

Mr. Zheng: For the maritime transportation, i.e., liner organizations, there is no challenge for the coordination’s management. The achievement and position are well performed and there is also space for improvement. We integrate our products so there is no problem in integration too. The problem exists in the inner land extension business.

It is less than a year for us to enter the Chinese market so now we are still making our strategy and do sufficient investigation. For example we make clear which are the inner markets by research and where should we begin. We will have more actions in the future.

R；What are the specific plans for APL in Chinese market?

Mr. Zheng: In fact our plans in China is very simple, that is we want to be the NO.1 shipping enterprise in Chinese market. In order to achieve this position, we will equip as much as needed. Now what we do is to increase the carrying ability and if needed, more actions would be taken in the future. Not only our company, now other companies are increasing the carrying ability too. At present, this kind of increasing is only to satisfy the need of the Chinese coastal areas and with the further development we need to pay great attention to the Chinese inner land. So it is very important to operate multi-transportation and related connection. If we fail to carry out multi-transportation, whether we can develop the connection between the ships to the best state is a problem. So we must pay attention to the multi-transportation and the basic facility’s construction of the inner land. Because in the next years in the future we can also see such a tendency that the manufacturing industry in the Chinese mainland will be transferred from the coastal to the inner land. So APL or other liner companies pay great attention to the cargo business of Chinese inner land.

Experience in Brand Managing

R: APL is keeping excellent business record so how do you manage the relationships between the supplier on the land and the cooperation partners of the ports?

Mr. Zheng: That is an issue that we discuss all the time. At present, we have established the league in shipping field. In fact we are powerful in the controlling of the shipping field so when choosing the cooperate partners we also should consider how to deal with the relationship. We have one selection standard: we complete the cooperation by contract or league but no matter what is the cooperation form for the partner, the standard is the service quality.

At present in the shipping league, APL has strong control and all the participant companies should follow the high standard. As to the land transporters, if there is cooperation there is a standard and we will check the cooperation with this standard all the time.

In Chinese market, along with the further development of the Chinese transportation market, in our opinion to maintain the controlling ability is the key point. It is also important to value with very strict standard. The supplier who is able to achieve this can make sure the excellency of the supply chain and also could distinguish himself from other suppliers to become the outstanding one. APL will achieve this. Of course, at the same time of keep excellency we will also keep the reduction of the cost. So we need to ensure the service quality and the controlling power. That doesn’t equal to the obtaining of the stock share. It means that we must to have the controlling power. That is what our clients expect on us.  

R: In such fierce situation of the market competition, I think your rivals are also considering the same questions. How do you ensure your advantage? And how to exert the creation tradition of your company?

Mr. Zheng: To the key market, our greatest advantages are our service quality, client’s service, staff, and operation ability. In these parts, APL is outstanding. If you check the related statistics and business record of the markets where APL is competing you will find our performance and achievements are excellent and we have gained the customers’ support. In the Chinese market, though I did not work long here, our team has carried the business for 140 years. And in Chinese market, APL has a very important advantage. That is that we are strong in shipping field and we have strong integration and transportation abilities that gain a lot from our customers.

At present, some companies do not use the APL’s service that is because these companies do not need the service of transport integration. And the companies who choose this service all select APL. Another advantage is that we keep good relation with ports and other sides. And we perform well in the costume transport line between China and New York on the Pacific Ocean. Shipping transportation between Europe and China is also a market causing great attention. All in all, the advantages presented in our experience, our service, our market and our clients are loyal. This is also a great advantage.

The creation ability itself is our most important advantage. Our creation is not for creation only; it is to satisfy the customers’ demand. Besides, we also have creations on Sea-Air transportation in business and Dubai as the trans spot between Chinese and Middle East market. And THE LAST LINER to ensure the cargo on the west coast can catch the earliest train. All these services all satisfy the customers’ special demand by our creation. In the area of creation, none of the companies could do better than APL.

R: The features of APL are efficiency and good service. How do you achieve these two points?

Mr. Zheng: Not only in the section of multi-transportation, we also value efficiency and quality. For example, we have a group of cargo to the destination from America and this process has a time charter, which starts its monitor from the beginning. Every section of our shipping business and every step has the monitor. Not only we should keep the quality and efficiency of our service, but also our clients when signing the contract require this. They need the company to provide the statistics on time for the quarter and the half-year’s report. So we monitor every process of the development of the business to ensure the efficiency and high quality of the business.

We pay great attention to trace, monitor, and connect and synchronize. These are important to the success of the multi-transportation. The question which arouses my attention is that at present, China has great scale of investment in the fundamental facilities investment, even amazing investment. But referring to the multi-transportation, the investment is not enough. If there is no need to invest in the multi-transportation, this investment is not enough. If there is no need to invest on the multi-transportation, it is hard to achieve the synchronization and connection. If there is enough investment on the multi-transportation in China, our aim is to realize the 100% synchronization for the business starting from China.

Competition and Cooperation

R: Because of the fierce competition, many companies make depreciation on the price. We won’t participant in the price fight. What we value is our brand. We should distinguish us from other shipping companies to ensure the excellency on the service and the quality. We hope to form our special statue by doing this. After obtaining this status, we do not need to participant the things such as the price fighting. Because we are out of pocket by this kind of fight. Until now, we can seldom see the related information on the price fight.

But we pay close attention to the situation of our competitors. Our Chinese policy keeps the same step with the our global strategy with our other companies in the world and we want to become the leading shipping companies in every market. We will make every effort to achieve this.

R: As the forthgoer of the multi-transportation, you have good cooperation with the railway in America, in the 1970s one transportation method has organized the liner, train and truck together. So how should we comprehend the multi-transportation? What is the use for reference?

Mr. Zheng: We have tried multi-transportation and it has the reference meaning for the Chinese market. We want to participant the multi-transportation work and assist China to perfect the multi-transportation. This is because we have a great deal of experience on this. The multi-transportation for train and railway is very good. But there is also many lessons and costs between us. We like to share our experience with China so we can assume the lessons we pay out to achieve success with quick speed.

The success of the multi-transportation in China is attributed to operate multi-transportation as the initial matter to do. When we are in America, we keep attention on the point of the transportation of coal and elementary goods. That is different from China. At present, the Chinese military material and technology and the transportation of the elementary goods are all in the important positions. There is no clear point but to most multi-transportation companies who have gained success that there should be a point. Then the 100% synchronization could be achieved. If companies with demand for transportation could not transport over 80% of the cargo by multi-transportation, they will be back to the traditional mode soon, as the road transport and the railway transport and airline transport. So we should put the multi-transportation as the first work to do then we can assure the success of this transportation mode.

R: At present, how is the cooperation between your company and Chinese railway? What is your suggestion towards Chinese multi-transportation?

Mr. Zheng: We now have established certain relationships with the Chinese Railway Ministry and I am positive on the developing future between the Railway Ministry and us. My suggestion is that China should put multi-transportation as the initial working point to carry out. Before the fix of this there must be some conflicts and fights and other transport modes will scramble with multi-transportation. But there must be a winner at last. If the multi-transportation succeeds many problems could be solved together. Now the greatest emergency is that we should put multi-transportation as the initial working point to carry out.