NCL International Logistics Plc, which listed on the Market for Alternative Investment last November, is a logistics solutions provider to industries ranging from petrochemicals and industrial goods to agriculture. Chief executive Kitti Phuathavornskul discusses the company's strategy and outlook.
What is NCL's business model?
NCL is a logistics solution provider. We define logistics as more than just pure transport — a true logistics provider is able to design, analyse and present a solution to its clients. This solution should go beyond purely lowering costs but provide an increase in efficiency, control and monitoring, which is what NCL strives to offer as a value-added service. Today we have 65 prime movers in Thailand and an office in Singapore to manage regional logistics and can service our clients via sea, air or land.
Who are NCL's target customers?
Kitti: Concerns over domestic situation
Our business relies on local customers, but we serve them with international standards. Essentially, any industry except dangerous goods can be our customer. We currently service customers in the petrochemical, industrial and agricultural industries, with most located in Chon Buri's Laem Chabang area. In the future, we hope to expand throughout the entire region and to the Middle East. Our relationship with our customers is stable as well due to multiyear contracts and the potential for them to continue increasing their business with us over time.
Please describe NCL's recent endeavours with Ranong port.
We expect Ranong port will be prosperous for NCL due to its location and logistics potential. It has been described by the Port Authority of Thailand as the "Gateway to the West" due to its strategic location on the Andaman Sea.
Goods are currently exported from Laem Chabang to Singapore and then to Yangon, and this process takes 17-21 days. With Ranong port, we have proved it can be done within three days. In the future, we hope there will be a land bridge connecting the Andaman and the Gulf of Thailand, which would then further increase the potential of the Ranong location.
What differentiates NCL from its competitors?
We are a one-stop service for our customers by providing a total logistics solution. We have a specialist in each area of logistics. Our competitors are normally just pure transport providers or have a single specialist. We have nearly 300 professionals dedicated to serving our customers.
How will the upcoming infrastructure projects in Thailand affect your business?
They will be very positive for us, as they will allow us to provide a wider variety of solutions to our customers. For Thailand to achieve its goal of a being a hub for Asean, it must invest in designing and improving the entire infrastructure and logistics of the country in order truly to compete.
Currently, Laem Chabang port has annual capacity of 10 million containers but is now limited to 3 million due to road congestion. We've advised the government that instead of simply increasing the number of lanes, a solution is needed such as creating separate truck routes where trucks can go directly into terminals to separate them from passenger car roads, which would reduce traffic congestion and accidents and then allow Laem Chabang to continue expanding.
What are the biggest risks facing your business?
Currently, it's the domestic situation, with the economy being weak and Thailand facing bans from the US and Europe as well as FTA talks being postponed. I'm worried about how much longer this situation will be prolonged. Thailand cannot live alone in this world. Without investor confidence Thailand will have less foreign investment, and then the country suffers and our customers will as well.
How will the Asean Economic Community affect your business?
It will be a wonderful opportunity for us, and we plan to be present in each country with strong local partners. The growth potential is there, with countries such as Indonesia growing twice as fast as Thailand, and we plan to diversify our services and revenue by being strategically located throughout the region. Our goal is to bring our expertise and systems, which we believe are the best in the industry for control and monitoring, and then join with strong local partners.
Where do you see NCL in five years?
During this period, we are investing heavily in our team, new projects and partnerships throughout the region, as we want to have a presence throughout all Southeast Asia and hopefully in Dubai as well since it's a gateway to Europe and Africa. With these steps taken today, we hope to see NCL as a true regional logistics company offering the best logistics service to its customers.
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