Could you give to our readers a brief historical background about your company?
PACKTRA is a private limited company owned by five shareholders. It was established at the end of 1990. This company main line of business is packing of household goods, personal effects, office equipment, and other materials. On top of these, we are doing this clearing and forwarding business, moving from one apartment to another, or from residence to residence. Most of the international organizations found in our country like the ECA, OAU, US Embassy, US Aid ad other embassies are working with us. We put ourselves as one of the senior companies, after the privatization has taken place. The name PACKTRA means pack and transport, and it has always been privately owned. We had our own offices in Assab. Now, we have offices in Nazareth and in many big cities of the country, we are also under establishment in the Djibouti port. Since, we are not lucky enough to have our own port, we are working through other ports, but it is not in a good flow of work, as it cannot be properly controlled. The documentation, and all the formalities take time. However, the customs is now trying to improve, and the transport organizations including us, are also trying to improve. Our country is land locked, this system not yet exercised in Ethiopia, because we were having our own port for so many years, and now we do not have it anymore, due to the Ethio-Eritrean conflict. We have now shifted to the Djibouti port, and still every part is not ready to operate in the land locked system. Taking cargo from the Djibouti port, which is about 925 km is difficult for a truck driver, to drive on his own to the port and back to Addis or the southern Ethiopia. Our rail transport is under improvement, but there is a lot of investment undergoing. Bringing cargo all the way using trucks is very expensive, taking into account the fuel, maintenance, and tires. Rail transport is really important even in Europe, as it is a mass transport.
At the present time the development of the transport sector is one of the main priorities of the government. There are a lot of companies, and constructors constructing roads, that might help you to develop your business in the following ten years. what is your opinion in this regard?
That is true, but trucking business is a very expensive business. We are not lucky, like the European countries, where the ports are very close to the main cities. The port we are using is almost close to 1000 km. To take goods down to the southern or to the northern part of the country, will take up to six days of transport. In my opinion, if there were somewhere in between a dry port, where we can bring the goods half way, and then looking for another means of transport will be appropriate. One truck will probably depart from here empty, will wait at the Djibouti port for three to four days to load, before driving back to Addis Ababa, which is very hard. Our company has a number of trucks, but the maintenance and the spare parts are very expensive. Besides, trucks are costly, as we have to import them.
What has been the evolution of you company since its establishment, in terms of turnover, and profit?
Our company is improving from time to time, but to be frank with you, in most cases the expenses is to the third party, that is to us. As I told you, there are a lot of costs, that includes the trucking, the fuel, the oil, and drivers allowances while waiting at the port. We are making close to five million birr of turnover per year. We suffered badly from the Ethio-Eritrean conflict, because this country has about 55 million people, that means we definitely need a port. If you have your own port you can manage and control yourselves. In the case of equipment, and facility the Djibouti port is far better, but they are not ready to handle all these cargo at this moment, as it is very small country. We have to pay for the clearing and everything else in advance, because they do not have enough money to cover everything, we are forced to advance them.
Could you give us the main guidelines of your strategies, and the best opportunities in the future growth of PACKTRA?
We are now lining ourselves in the clearing and forwarding, business follow-up. We will not only a transport and clearing company, but we will extend to construction of more warehouses, and to bring heavy lifting equipment. However, as you know there is any support even from the bank, or other international organizations specially for the clearing and forwarding. They consider it as a service, and the banks are not ready for, to give enough money to buy their own equipment. If it is factory, or a small industry, they will give loans, but not for services. Even for the land, there is a different payment if the business is service giving.
| Could you tell us your market share, in order to evaluate your position?
As I told you PACKTRA is one of the biggest and senior companies. We are handling most of the international business. We are practically handling all international organizations, we have professional staff, and we take our staff from time to time for training. For instance, we are sending Mr. Tsegaye, who is one of our staff to Baltimore to study on how to handle dangerous and hazard goods. PACKTRA is the only professional company, and we are also a member of the American household goods forwarding association. I was recently in America to attend this convention, that was in Palm Spring and in Florida, Miami. We share the experience from time to time with most of the international organizations, we go some times to London, and to Paris. Packing household goods and furniture is a very expensive business. For someone, it is not even easy to handle its private properties, and taking care of his cargo is very expensive. We have also to handle properly perishable items, and for this we need training to update ourselves. We are the only company to pay for training. As my understanding, our competitors do not have the well experience, as they are not even members of this association. To become a member of the household goods forwarding association, there are certain criteria that should be attained. For instance, you have to be in the business for at least five years, fill the academic background of the shipping and all the other businesses. PACKTRA is the only company to have the required facilities.
Is the Ethiopian Maritime Transit Services your competitor?
Maritime Transit is my ex-organization. I used to be the Deputy General Manager of that institution. I do not know its recent position, but it is still supported by the government. There was a loan of about $3 million recently, which all went to that organization, and we did not have any share. Therefore, they are still fat.
Our readers are always interested in new business opportunities. In which areas of your activities are you interested to attract partners and foreign investors?
At this moment, we want to sell 50% of our company share. We want to bring investors. After selling to the shareholder, we will bring more equipment, materials, construction, warehouses for dry cargo, and cold storage. We do not have cold storage in this country, there are only 1 or two governmental owned. Without cold storage, it is impossible to export our fruits, meat, and flowers. We need someone who could invest, and reestablish this company to the international standard.
How confident are you in the future of your country?
The future and the prospect is good. There is a little problem with Eritrea, but it will not continue like this. I see the future in a better way, and that is why, we are investing more and more. There is stability, and we can move things from one place to another, as it is not centralized like before. There have been big improvements during the past eight years. However, they did not see this service sector from the point of policy. Whenever, higher officials or the investment bureau make study, they only concentrate on agriculture and industry. How about service? Service is very important, as it gives support for the agriculture area and the industry area. We do not have any incentives. In the case of agriculture, industry, or in opening hotels there will be tax free for two years, land for reasonable price, and so on. For services like us, we have a lot of tax, and we do not have any promotions. Additionally, the bank is not willing to give loans for those who intend to give services.
Most of the time, in Europe and the United States contacts often means contracts. What is PACKTRA going to do in order to encourage contacts?
Our company is a member of the International American household good forwarders association, and we have contacts with the UTS from north America. We are asking the customs to prepare a brochure about their regulations. It has to be transparent. |
