Poland is one of the most competitive markets in Europe

“We do not intend to become the largest logistics operator in Poland, but we definitely want to be a key player in contract logistics in terms of innovation, customer focus, quality of service and cost efficiency,” says Yann Belgy, General Director, ID Logistics Polska, in an interview for warehousefinder.pl.

Warehousefinder.pl: ID Logistics started its operations in Poland in 2008, when it opened a warehouse for Carrefour in Będzin. How has the company’s activity in Poland been developing since then?

Yann Belgy, General Director ID Logistics Polska: ID Logistics Group is indeed still a young and very dynamic company. It started operating in France in 2001, as an answer to the need expressed by customers to have a logistics provider able to accompany them in different countries for their contract logistics needs. It then developed in other regions, and we are now present in 17 countries, mostly in Europe but also in South America, Africa and Asia.

From the very beginning, we decided not to spread our resources and energies through many services, but to focus on where we have the highest expertise, i.e. on contract logistics. One of ID Logistics’ first partners was Carrefour. After taking over Ahold shops in Poland in 2008, Carrefour asked us to come and help them implement IT solutions and later take over the management of the Będzin warehouse, delivering fresh and dry products to southern Poland.

Within 10 years of activity in Poland, ID Logistics developed at a fast pace, and we are now managing 8 warehousing locations, representing 200,000 sqm and 1,700 direct or temporary employees, mostly for customers from retail, FMCG and automotive industries.

How does the company’s European portfolio look like right now?

In 2011, ID Logistics was managing 70 warehouses in Europe. In 2016 the number almost tripled to over 200. Today, we are present in 9 countries in Europe—we started operations in Romania in October 2017—where we manage approximately 5 million sqm of warehouse space.

What were the breakthrough events in ID Logistics’ activities in Poland?

Since 2014 we have been making really strong efforts to improve the quality of our services and the satisfaction of our customers, so we were very happy to have been recognised as best logistics operator of the year in 2016.

You have been leading ID Logistics in Poland since 2014. How would you assess the Polish market compared to other countries?

The specifics and structure of each market are different, which is why it is difficult to compare the Polish market to other countries. We can say that Poland has one of the most competitive markets in Europe—this is true for logistics but also for most of industries—with many players and fierce competition, high level of professionalism and service, and competitive costs. Comparing to Western European countries, the level of service is thus the same or higher and costs are significantly lower, not only due to lower workforce costs, but also property prices, optimised processes and low margins. At a time when logistics becomes more and more Pan-European, if not global, this makes Poland a very attractive alternative for many companies. This is the reason why so many companies have been recently opening European Distribution Centers in Poland, especially for e-commerce.

How has the Polish market change since you’ve started working with ID Logistics in Poland?

In the late 2000’s, the logistics market in Poland became more competitive, with many international and Polish providers entering the market, and customers expecting cost reductions. It allowed the Polish logistics market to become more professional, with a strong pressure on prices.

Since a few years, I believe that we have reached another level, where high service quality and cost-efficiency are still prerequisites, but are not sufficient on their own. The real competitive advantage should be brought through adding value to customers’ supply chains with proactivity, the ability to adapt to a quickly changing environment, innovation or capacity to attract and keep human resources.

You mentioned the growth of the e-commerce segment. How does e-commerce affect the development of ID Logistics?

E-commerce is a field of high expertise for ID Logistics, especially in countries such as Spain or France, where we are a leader in this area. Most of the warehouses opened by ID Logistics in recent years are connected to the e-commerce sector. These clients are companies focused on the e-commerce sector or rebuilding their logistics for multi-channel distribution.

Do you think the Polish market underwent some changes following the growth of e-commerce?

The development of e-commerce created additional needs for contract logistics, both for “traditional” customers focusing on multi-channel distribution and pure e-commerce players who need logistics bases to support their growth. The requirements and technologies used in contract logistics for e-commerce are quite different from “traditional” distribution channels—in terms of units handled, size of orders, leadtimes, peaks’ management, needs for flexibility—and pose real challenges to both operators and their clients.

Adapted solutions often require a higher level of automation, and thus long-term and wide partnership between the logistics provider and its clients, allowing them to work out more efficient long-term solutions, including larger investments and the implementation of specific technologies.

Where, in your opinion, will the company end up in the next few years?

We do not intend to become the largest logistics operator in Poland, but we definitely want to be a key player in contract logistics in terms of innovation, customer focus, quality of service and cost efficiency.

ID Logistics keeps on reinforcing its position of the leading logistics provider working with retail chains. While strengthening your presence on European markets, are you planning on extending your operations to other industries?

Our default industries are retail and FMCG, and they are still responsible for most of our activity in Poland. In Western Europe, we have intensively developed our services for industries such as e-commerce, cosmetics, fashion, hi-tech and automotive. This is now what we intend to do in Poland too, offering our services to clients from other industries, using both our knowledge of Polish market and specific good practices developed in other countries. In terms of services, we are present mostly in contract logistics—i.e. warehousing operations with connected added-value services— and we expect to go on focusing on this area in the coming years.

ID Logistics conducts annual internal customer satisfaction surveys. How did it go in 2017?

Customer satisfaction is really at the heart of our concern. We are so glad and proud to notice that it is still growing year after year. In 2017, our customers ranked our services in Poland 3.5 on a scale from 0 to 5, which is one of the best grades in ID Logistics Group.

The result is confirmed by an independent study. In December 2017, ID Logistics Poland was ranked number one in terms of warehousing services in a yearly DGC survey.

The latest ID Logistics’ contract was signed with PepsiCo. The leading food and beverage manufacturer has chosen ID Logistics as the operator managing PepsiCo’s new consolidation warehouse in Grodzisk Mazowiecki. What will your responsibilities be?

Before we signed this contract, PepsiCo and ID Logistics were already working together in France, as well as in Piotrków Trybunalski for temporary operations. We are very glad that PepsiCo decided to entrust us the management of its largest warehouse in Poland, in Grodzisk Mazowiecki. These operations started in November 2017, and we are now mostly supporting Fritolay’s and Chipita factory for export flows to Central European countries.

In the coming months, we will also integrate beverage activity into in this warehouse and start delivering goods to regional distribution centers and selected key accounts. Apart from warehousing operations, ID Logistics is also managing shuttles to the factories and some of the distribution lines on behalf of PepsiCo.

What does this new investment project look like?

The operations are managed in a brand-new 23,000 sqm A-Class warehouse built by Goodman in Grodzisk Mazowiecki, just along the A2 motorway. Its location is optimal both for inbound flows coming from PepsiCo factories and for further distribution.

Approximately 100 warehouse operators are employed in the location. Because of the short project leadtime, it was also very important to us to be able to support this new warehouse from our existing activities in Błonie and Mszczonów. The ability to deliver the building in time as well as the capacity for further extension were also critical considerations in the selection process.

Just as in the other ID Logistics’ logistics centres, the centre for PepsiCo is set to implement the internal ID Logistics Certificaton—CID. What is its role?

CID is ID Logistics’ own quality system. It includes all the fields covered by independent quality systems such as ISO or IFS, but also all the good practices ID Logistics developed when working with its clients, which allows us to quickly reach expected levels in terms of service and operational performance.

In your acquisitions of new warehouse space, you work together with the JLL firm. How do you assess your partnership?

Our cooperation is going very well. This is why ID Logistics Poland has chosen JLL as a strategic partner to represent us for most of our real estate needs. JLL’s expertise and market know-how enable us to quickly identify the real estate solutions most suited to our expectations. Our long-term partnership proved to be efficient, allowing us to integrate the best-adapted properties within the contract logistics solutions we offer to our clients.

Tomasz Mika