“The Fashion Industry needs to adapt its Supply Chains”
Rachael, you joined Hellmann just a couple of months ago. What was your first impression of the company?
Rachael van Harmelen: I joined Hellmann in January as Director of Business Development for Fashion & Retail in Canada and the east coast of the United States. Before, I worked for several other global freight forwarders as an inside and outside sales representative. For me, working with the Fashion Industry is a dream come true. As a huge fashion fan, I love collaborating with all these famous brands. Why did I decide to work for Hellmann? Because it’s an extremely flexible and flat organization, which makes it very attractive for young and ambitious people like me.
Rachael, after your first month with the company, where do you see the biggest pain points for the Fashion Industry, especially in North America?
Rachael van Harmelen: I think the situation in North America is not very different from other parts of the world right now. Like almost any other trade lane, the transpacific trade is suffering from the current situation with little capacity and high rates. Thus, we are struggling to get our customers’ products to the point of sale on time and on budget – with the latter being probably the hardest thing right now because rates are nearly changing on a daily basis.
Torsten Katzor: I agree. The volatile rates cause a lot of uncertainty for all parties, be it shippers, freight forwarders, or even carriers, who are also struggling with the situation. On the other hand, capacities are almost non-existent. Therefore, we are steadily striving to find unique solutions for our customers, which requires us to be very agile. After all, our customers still demand reliability, that’s why we need to think outside the box.
We see a lot of business units that are offering unconventional solutions right now. Hellmann East Europe for example is running trucks from China to Europe, and they probably didn’t even think about this a few years ago. There seems to be a demand for unconventional solutions, is there any comparable solution that you offer to your fashion customers?
Torsten Katzor: When we talk about sourcing from Asia, whether from China, Vietnam, Cambodia, or Bangladesh, it’s a little difficult to come up with trucking solutions on the transpacific trade – your options in terms of transport modes are limited in a way. But we have our Sea-Air product, which is very flexible. With different HUBs on our global trade lanes, we can respond quickly to changing circumstances. On the Far East/Westbound trade to Europe, it’s a little easier to play with different modes of transport. Here we can indeed switch to truck transport or rail solutions besides air and sea freight.
However, I also see an issue in the fact that the Fashion Industry needs to adapt its supply chains as well. I just had a call with an important customer who plans a large volume transport – we are talking about 1,300 CBM from Bangladesh – and they said they need the goods by mid-September. Thus, customers still put the same pressure on us as a forwarding company as they did before the pandemic. Eventually, they also need to rethink their planning and production, I think.
When will the situation change back to normal?
Torsten Katzor: Usually, we see ease after Chinese New Year. However, we already said that in 2021. Who knows how things will develop until 2022?
When we thought things would get back to normal early this year, there was the Ever Given accident in the Suez Canal. How did your Supply Chains react to this unpredictable situation?
Rachael van Harmelen: The ripple effects affected our business massively, we felt that in Europe first and after that also in Asia. There was no equipment available at all.
Torsten Katzor: We need to consider the structure of the global Fashion Industry in this context. Like no other business sector, the Fashion Industry has its production almost entirely based in Southeast Asia: Vietnam, Cambodia, Bangladesh, and China of course. So we immediately feel the impact, if supply chains are interrupted like they were with the Ever Given. But also the backlogs in Chinese ports that we saw in the last weeks, or the closing of production sites due to new Covid-19 cases put extra pressure on our supply chains.
What are your customers’ demands in the US and Canada?
Rachael van Harmelen: They are approaching us about China. That’s the only real thing right now. They come to us to find individual and flexible solutions.
Torsten Katzor: This opens a lot of doors to potential customers right now. That’s of course a welcomed situation for us, but we also need to deliver. So, what we try and do is to focus on trade lanes that we can keep stable, which are Vietnam, Bangladesh, India, and other Southeast Asian countries.
Rachael van Harmelen: In this regard, I have been extremely impressed by our India and MESA teams. I have never seen a company with such a strong Southeast Asia presence and capability. Our teams over there have been extremely smart in allocating space where there wasn’t. The Bangladesh trade lane has been smooth. That is something we can be proud of in this current situation.
Thank you for these interesting insights!
Your contact for any inquiries:
Global Vice President Hellmann Fashion Logistics
Rachael van Harmelen
Director Business Development
Hellmann Fashion Logistics Canada & US East Coast
Find more info about Hellmann Fashion Logistics at www.hellmann.com/fashion.