Keeping the Promise

Fracht Australia Pty Ltd

Logistics provider Fracht is a privately owned Swiss company established in 1955. The founder, in his eighties now, still goes to work every day though the company is now run by his son Rudolf Reisdorf Junior.

Originally, Fracht classed itself as a freight forwarder and forwarding remains a large part of the business. Now, however, the company terms itself a logistics provider to reflect its expanded services. Fracht of Basel, the Swiss parent, owns fifty per cent of Fracht Australia with the remainder held by the Australian directors. Fracht Australia, established in 1987, is fully nationwide with its head office in Sydney and branches in Melbourne, Adelaide, Brisbane and Perth.

In global terms, Fracht falls in fairly rarefied territory, being neither a one-man band individual forwarding office nor a fully fledged multinational. Managing Director Peter Pluess says this is actually a rather good place to be, for a number of reasons. “We see some of our clients moving away from the big multinationals because they want a somewhat more personalised level of service,” he explains.

In Australia the company employs around seventy-five staff members, while its network around the world has between sixty to seventy offices with around one thousand staff in total. More than a hundred of those employees specialise in project logistics – the moving of unusual or oversized cargoes that don’t fit easily into boxes or containers. “This is very good for the Australian business because if you simply want to move a container from, say, New York to Sydney – or a piece of airfreight from Frankfurt to Melbourne – you can have something in the region of two hundred competitors for that business. But when you look after some big project cargo, then the competition is much more limited.”

Being this middle-sized operation “ is reasonably comfortable for us because we can operate, to a large extent, independently in Australia,” says Peter. Fracht is largely untroubled by the global policies that drive multinational names, including the extensive and time-consuming

reporting requirements to regional or world headquarters that “take up a lot of valuable management time. We are the most expensive people and if we spend a lot of our time putting reports together and fighting for our own little niche it is not productive. We do not have that in Fracht. As long as we have figures in the black, and we have always had those, we can do pretty much what we want – within reason, of course. There are many hours every week that we do not waste reporting overseas.”

Peter adds that a lot of decisions are often made overseas in the big corporations, which would not necessarily suit an Australian client. “We do not have to put up with all of that; we can concentrate our management time purely on Australian companies and can make our own decisions. In certain instances this can be a very big advantage.”

Fracht prefers not to own its own fleet. “You will see trucks wearing the Fracht logo, but they are on full-time charter,” Peter explains. The company took a decision that, even if it costs a little bit more, the convenience of having an outsourced fleet – not having to worry about replacement trucks, a sick driver, maintenance and all the other headaches of managing a fleet –would be worth it to be able to offer clients an enhanced level of reliability.

Nevertheless, the logistics space is still very crowded, so what makes Fracht Australia stand out? Personalised service is an important differentiator, says Peter. “In the Fracht office, you will always get a real person answering the phone; you get intelligent answers. Our clients range from small companies up to some very big multinational corporations such as
Siemens, Alstom or UGL. But every single client, no matter how large or small, has access to
management.” This access has definitely been one of the company’s advantages as it eliminates many potential mistakes and creates positive feelings which, in turn, generate word-of-mouth recommendations.

“Also, our independence means we can treat our employees a little differently. That means we have a very loyal workforce – the average employment in our workforce is eight years and I am sure that is not the case with the multinationals.” Indeed, when Fracht does have to seek new staff there is rarely any need to resort to job ads or recruitment agencies; there is almost a queue of capable logistics people waiting to sign up. Peter says the company takes care to empower its employees, giving them a sense of individual responsibility that makes their job more rewarding.

Although the company is happy to shift anything anywhere, Fracht specialises in and enjoys the challenge of project logistics. “We do have a very good reputation in this field. Any type of challenging freight – when it gets a bit difficult, with either a very small job or a conveyor- belt type of operation – it is hard for the large corporations to accommodate them, and we are happy to fill that niche. If it gets difficult, we invest the time and we find a solution.”

In geographical terms, Switzerland is naturally something of a speciality for the company, even if its volume is not so great. “We are reasonably strong in most countries out of Europe, especially Holland, Poland, Germany, France, Italy and the UK,” shares Peter. There is, of course a lot of business with Asia – especially China where Fracht Basel has its own office. “Vietnam is a very interesting place for us, not least because we have quite a few employees from that country – some in senior positions – who have worked with us for many years and developed good relationships.”

Fracht can move freight to and from any port or location, but Peter says a specific and emerging strength is in South America – a continent regarded with trepidation by many freight forwarders because of the challenging sea and air connections and also the mass of often eccentric paperwork demanded by many South American customs departments. “For some reason, most of our competitors are not interested in this area. It is difficult to get freight there from Australia if it does not fit into a container; most of them either do not know how to handle it or they are not interested. While it is a small market, it is a very good niche for us.” A lot of mining equipment, for example, gets shipped from Australia to markets such as Peru, Chile or Brazil. “Even if it does not come through our own office, we seem to be getting a growing amount of enquiries from South American forwarders who come to us and we find a solution for them.”

Fracht has logistics accreditation with the Department of Defence and, although there is not much forwarding to be done directly for the department, the company enjoys good business with defence contractors – although, for obvious reasons, Peter declines to name names. “We also get involved on a regular basis when the American Armed Forces go on joint exercises with the Australian forces every two years in the Northern Territory.”

An unusual and rather fun client is the Cirque du Soleil. “We don’t move their tents, but we move all their promotional equipment and distribute it from our warehouse in Sydney to wherever they have their shows.” Other customers include anyone looking for more

personalised service, for smaller loads as well as big project cargoes. Many multinationals are now set up in such a way that they find smaller loads inconvenient to handle, but Peter says Fracht does not turn such business away. “We look after customers’ total logistics from the moment they order overseas, to the delivery, to the final client anywhere in Australia.”

This is a business in which, if it can go wrong, it often does. Customers generally understand that – it is part and parcel, as it were, of logistics. But what distinguishes good service from the crowd is how a forwarder reacts to problems and overcomes them. And Peter says keeping the promise made to the client is what Fracht’s clients value most of all.

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

December 19, 2018, 5:13 AM AEDT