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Turning logistics in the right direction

Interview - May 24, 2013
Simon Cohen, General Director of Henco Logistics, tells Upper Reach about how he took over the management of a run-of-the-mill Mexican-German logistics company 15 years ago and turned it into one of Monterrey’s most successful enterprises by changing everything he’d found unsatisfactory from a client’s point of view. Today, client loyalty is, unsurprisingly, “enormous”
SIMON COHEN, GENERAL DIRECTOR OF HENCO LOGISTICS
SIMON COHEN | GENERAL DIRECTOR OF HENCO LOGISTICS
The logistics industry in Mexico is key to improving its nation’s productivity and competitive advantage, in order to surpass China internationally as its competitor and to launch the economic growth that is at stake. How is the sector presently perceived? What have been the main changes in this sector over the last few years?
 
The sector has suffered many ups and downs. Following the crisis that affected us in 2008, the outlook became more complicated due to a drop in the activity of shipping companies, because of a stagnated flow of imports and exports. In 2010 these companies decided to remove ships from circulation in order to generate higher demand in an effort to maintain acceptable prices. In 2012, they reintroduced the ships that were out of circulation and the same problems recurred, which is my reason for saying there are many ups and downs in this sector. 
 
Within this sector we are positioned as intermediaries, we are logistics operators and we have been able to do quite well. Our company is the means by which a diverse number of businesses can grow; a business cannot exist without good logistics and unfortunately companies do not invest sufficiently in this sector. I think the industry is strong and the market is undergoing growth. Mexico is a trend-setting nation and has high demand for its logistics services at the national, local and international level. 
 
What are the challenges and guidelines you have followed to gain a good position within a sector that has multiple operators?
 
I graduated law school in 1996. Mexico was drowning in a severe economic crisis and my family was involved in the textile business. My father invited me to work with him; I joined with a small salary. The idea was to export the merchandise and clear the debt we had, from there I began to export some products but I realised that the service we were offered by logistics companies was very bad. In the search for logistics providers, I found a company founded by Germans, which I ended up working with. 
 
After some time, they made me an offer to work with them on a 50% partnership arrangement to open up a branch office in Monterrey. We began the business in 1998 and by 2000, we had already reached the size of their Mexico City office. By 2004 we were much bigger than them and by 2007 we bought over the partnership. We achieved all this by changing what I disliked when I was a client, such as: picking up the phone promptly, not leaving the client waiting for longer than 30 seconds, waking up early if necessary so that my clients could have information about their merchandise. 
 
The main guidelines that have always been with us have been transparency and ethics. There was a moment in the company’s life when I decided it was time to make positive changes by creating added value, not just for the clients, but for the employees as well. I decided to create a company where every one of us who worked felt happy to be a part of it, in other words this meant giving our employees time to be with their families, time to sleep and to enjoy themselves. This is the origin of the concept which has guided us and which has made us renown over three consecutive years as one of the best companies to work for. 
 
Another important topic to mention is our business model, which has us constantly thinking about ways to surpass our clients’ expectations so that they will personally recommend us, saving us the work of knocking on doors in search of clients. It is relevant to mention that this business model has been taken as example even as far as London. 
 
A message I would like to send to the United Kingdom is that Mexico is oftentimes catalogued as corrupt and violent, but it is not true, Mexico is full of warm friendly people who welcome foreigners with open arms, who open up their homes to them, offering food and drink until they are satisfied. We are great entrepreneurs and, above all, we measure up to the best.  
 
Taking into account the great business strategy you have developed over the years, what characteristics define the services you offer?
 
We are a logistics company that manages air, maritime and ground freight for exports and imports from all parts of the world to all parts of the world. We also manage customs, packaging, storage, distribution and bailing. We organise the logistics of companies and base our business on our buying power. 
 
What is your vision for Henco Logistics? Where do you want to be mid term?
 
Presently we have a very interesting plan for expansion. Two years ago I moved from Monterrey to Mexico City and realised that there is a market and great possibility for growth here. The goal is to open offices in Central and South America because we have the required power to begin participating in other markets. We are a privileged company because our clients feel very satisfied with our work. We will inject capital and we are convinced that in two or three years we will have market position in those countries. 
 
Which are the industry level sectors in which you have greater presence? Which clients have trusted their logistics services to Henco Logistics over these years?
 
When we started out, we did not focus on any one sector in particular but we became very involved with multinational companies, one of them was Flextronics; we have been their exclusive suppliers during the past ten years. PepsiCo also trusts all of their shipments to us and we even manage their warehouses. We are suppliers to other big companies such as Elektra, Waldos, Comercial Mexicana because we have enormous client loyalty. 
 
Technology plays an important role in the logistics sector. What is the role of technology within Henco Logistics?
 
We recently introduced a new system and we are very pleased with it, but we are aware that it is important to constantly innovate and we have always been at the forefront in this regard, funnily enough our competitors quickly copy our new systems. 
 
During the G-20, Mexico and the United Kingdom signed an agreement to double the commercial and investment relations between both nations. What virtues will an investor or any other player from the United Kingdom in need of a logistics operator find in Henco Logistics?
 
We always provide a little extra and we can offer British companies transparency and honesty above all. They will encounter a company that takes care of all their logistic concerns, from collecting the product at storage to delivering to the final client, with an eye on every detail. Also, we link potential clients between clients and suppliers, we help put their product our there, we take care of clients and offer competitive prices while delivering on time. We are the perfect point of entry for British companies that are unfamiliar with the Mexican market. 
 
What message would you like to give to investors who are not convinced about investing in Mexico?
 
They are losing opportunities, Mexico is the best place on earth, and holds a great position in terms of foreign investments, inexpensive land, qualified workforce and competitive advantage, a 3,000 km border with the United States, a geographic location that facilitates commercial activities to any part of the world. Mexico is a spectacular country with much potential. They must lose their fear because any person willing to work hard in Mexico will surely attain success. 

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Nobumasa Ishiai

President and CEO, ABLIC Inc. Senior Managing Executive Officer, MinebeaMitsumi Inc. (Parent Company of ABLIC)
ABLIC Inc.

HIROSHI KOYAMA

MANAGING DIRECTOR
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Yoshihiko Hirano

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Yorifusa Wakabayashi

President and Representative Director, Chief Executive Officer
DAIO PAPER CORPORATION

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