Interview with Martin Winchell, CEO of Schneider Logistics in China

On 11th September, Schneider Logistics which is the affiliate of US Schneider National Inc. announces that it will purchase Baoyun Logistics. At that time, many people know little about the leader of the world logistics industry.

However, Schneider tells us that they have many years research to the Chinese market. After entering Chinese market in 2005, they have owned 630 personnel. The business operation of Schneider is not only about consultation, but also supply chain which includes transportation, warehouse and the third party logistics.

Although it is short time for Schneider stays in Chinese market, it has great reputation for long time in logistics industry. Schneider is established by Schneider family in 1935, and it only owned a truck when it started. The headquarter is in Wisconsin. At present, the turnover of Schneider is 3.7 billion dollars annually and there are over 20,000 personnel in the global. The Schneider is spread in 28 countries, cross over US, North America and Asia, serving for 2/3 of the top 500 companies. The industries include consumption, retailing, automobile and manufacturing industry. The magnate like Schneider definitely has its magic weapon.

 Transformation and expansion

Reporter: at present, China Logistics industry is in the processing of transformation, including private enterprise is transforming from the traditional transportation and warehouse enterprise to modern logistics enterprise. Schneider is also the private enterprise, and has experienced the transformation from traditional transportation enterprise to modern logistics enterprise. In the direction of modern logistics enterprise transformation and market competitive, what do you think that China private enterprises need to pay attention to?

Martin: the private enterprises all need to concern with the infrastructure, and the infrastructure is mainly in increasing efficiency and management ability to realize the qualitative transformation.

 Reporter: The logistics enterprises expand the market, do they need to depend on continually merging or depend on themselves?

Martin: The continually merging is unnecessarily best solution, because the logistics market is in the fast transformation period. Schneider concentrates on the accruement development, and expects the foundation of the company is stable. China logistics market is dispersive at present. According to the dispersive situation, the accruement development is probably the advisable approach. Facing the dispersive market, in order to continually develop the market, the scale of the enterprise is not the key determinant. However, how to decrease the cost and increase the flexibility are the vital factors. Even if a large enterprise, it will also confront the dispersive market situation. Therefore, it is important to decrease the cost and increase the flexibility.

Concept and technique

 Reporter: How does Schneider become the global logistics magnate at the beginning of only one truck?

 Martin: in the process of growing and succeeding, Schneider concentrates on the operation predomination, and engages in the high quality service and efficient operation. Furthermore, we are the leader of management concept, and carry out the new ideas of the management concept to push the industry development. Today, we hope not only us get the success, and also expect to help push the development of China logistics industry.

Reporter: In the 70 years developing process, what technical support does the Schneider rely on to achieve the phase development?

Martin: In the logistics industry, to possess the technical advantage will be the industry leader. Especially in the transportation, Schneider is the first using two-way satellite communications which is the wangon satellite communications. The transportation management system adopted by Schneider is the most advanced in the whole industry. Schneider has devoted a lot to the system which accomplish the service quality. However, the technique is constant, predominant operation flow and management coordination is the determinants. Also they are the key points for the China logistics market development. Both technique and management are important.

Merge and cooperation

Reporter: China logistics market is quite different with US logistics market. US enterprise is high end, but most of China road transportation enterprise is low end. In the service and management aspects, the distinction between China and US is very large. In the merging development, how does Schneider realize the connection between high-end market and low-end market?

 Martin: I need to emphasize one thing, 2/3 customers of our company are world top 500 enterprises. In the business development of Chinese market, we expect to bring the customer advantage to China market. To realize the connection between high-end market and low-end market, the flexibility is essential. China logistics market has its particularity, such as low cost operation, so we cannot bring the methods to China without adjusting. We need to distinguish the special situation of China and obtain the largest competitive advantage.

 Reporter: There are many purchase cases in China market this year, and several of them are not aiming at developing their business operation, but promoting in the capital market. How do you think of this phenomenon?

Martin: we need to clarify that Schneider is a strategic and far-sighted company. All the solution we adopted is for the long term development, because we have a long term target in China. As far as the current phenomenon, some investment banks or finance institutes purchase logistics companies and sell them, and gain the benefit from them is not our mode and interest. We are not interested in this mode and we expect to be a predominant logistics company.

 Reporter: Schneider is as a global leader in logistics industry, and how does it bring its advantage into the market?

Martin: The purchase we did in China is only the capital merging, an d it combines perfectly the local operation advantage and well-known brand worldwide. Although these two markets are quite different, we can see their development trends are the same. Facing the dispersive market, the same as we are in US, from the dispersive market to the situation that we increase the efficiency, it needs long term strategy to adjust the market change.

Reporter: Schneider possesses many vehicles in US. So will you purchase the vehicle in China to establish your large vehicle team?

 Martin: not current. The market situations are distinguished between US and China. The scale of our company is large in US and we have advantage. That is why the vehicle in US is large, and it is smaller in China, about 25-50 vehicles. The China market is dispersive, low cost and high flexibility is more competitive advantage.

Reporter: You can control more easily if you have your own team. It will be a little complicated for cooperation with other parties. So will you feel passive to cooperate with SME logistics companies?

Martin: Not really. We have experience with partners. Like in US, whereas our team is large, we still have 6000 partners for cooperation. We have completed quality supervise and evaluation standard of service level, we recognize how to cooperate them to obtain their largest advantage.