Optimizing Supply Chain: Logistics Startup Qafila Digitizes Freight Forwarding In The UAE
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Founded in 2017 by co-founders Atif Rafiq and Jitin Manoharan, Qafila is a digital freight forwarding service provider which enables customers to book, track and manage shipments in real time via its website and mobile app. The co-founders noticed how the transportation and logistics is lagging behind utilizing digitalization and aimed to solve the sector’s inefficiencies. “A single pallet of goods has to pass between 6-7 companies in a single product shipment,” says Rafiq. “Today, this is all managed through phone, paper and, in some countries, by fax. The transactional cost is phenomenally high as data is still trapped in organizational silos and there is room for error every step of the way.”
The duo started their journey by being incubated at in5, wherein they designed Qafila to streamline operational efficiencies and provide customer support in the freight forwarding sector. “Something that we are particularly proud of,” Rafiq points out, “is the speed at which we can take a user from ‘quote’ to ‘ship’ in minutes whereas traditionally, it would have taken them hours, if not days, to just get a quote and along with that dozens of emails, phone calls to negotiate and finalize a price on that quote.” Starting with sea shipments, the platform offers instant quotations, online booking, real-time tracking and tracing, 24/7 customer support, and data-driven insights and customized reporting to provide visibility, transparency and a reliable system, with a single point of contact.
Jitin Manoharan, co-founder, Qafila
Recently, it has also offered the ability to search through hundreds of combinations of sea schedules available, resembling to a passenger searching for flights. Bringing the same ease and convenience of shopping online or booking a taxi to moving freight by sea is the goal. Manoharan also points out that the platform bundles all freight carriers into a single database, offered free to its customers, which, they feel is just scratching the surface on the global logistics and transportation industry. “There is air, land, warehousing, e-commerce logistics, and so much more to do with the data collected around shipments that will help companies optimize their supply chain now that they have a fully end to end digitalized shipment journey.”
As for its validity, the co-founders state that they are already working with some clients regularly, taking them through the process and migrating their process to the platform without any issues. According to their website, these includes Maersk Line, Etihad Airways, Emirates Sky Cargo, Gulf Air, DHL and Singapore Airlines. And they’ve gotten a few recognitions too- the startup has been selected as one of the winners of Intelak incubator (which focuses on aviation, travel and tourism) on its sixth cohort, plus awarded Logistics Startup of the Year at the Logistics & Transport Awards 2019.
Customer-wise, since they are in the B2B space, the duo says they tend to have longer sales cycles and more importance is given to a detailed KYC (know your client), which helps speed up the process. In terms of financing, the duo bootstrapped the company, taking the route to focusing on building the business first, before raising money. “We decided early on to be profitable from day one,” notes Manoharan, which, to be fair, has helped them in their growth as the approach encouraged the team to always be on the lookout for productive solutions at a lower cost when solving issues.
As a nascent service in the sector (and in fact, one of the first in the region), the duo finds it exciting and terrifying as they need to educate customers first, build awareness, and trust before a sale. “The industry is fragmented and highly competitive where supply chain is viewed not as a competitive advantage, but as a functional business unit, and hence, business leaders do not put supply chain digitization as their priority as some are still debating about its benefits.”
Rafiq is optimistic that they can leverage on this as they grow: “We feel being a digital-first gives us an advantage over our more traditional peers. Because these technologies are in the early stages of implementation, and do not yet have regulatory support or because companies lack the internal capabilities to capitalize on them, we feel we would be in much better position in the adoption curve to use and utilize these technologies in our supply chain.” As for what's next for the startup, Qafila is in the process of adding air, LCL (less than a container load) and other segments to their business, including smaller businesses.
‘TREP TALK ME
Atif Rafiq and Jitin Manoharan, co-founders, Qafila
What are some of the main considerations that entrepreneurs should keep when starting up a business in the Middle East and why?
“Starting a new business is a journey and I think entrepreneurs need to understand that this is a long-term commitment. The reality is that you have to be committed to doing whatever it takes to make a company successful. When you start a company, it’s a mix of hard work, perseverance, and luck. Most it is hard work and willingness to pick yourself up from a rejection.
Another factor to consider is, initial setup cost for a new business. We were lucky to be incubated at In5, but not everyone is as lucky. Entrepreneurs need to be aware of the initial cost to setup a business in region. Humility provides clarity. Humility pays, pivot from arrogance to humility. You can be confident in your idea but still seek out the wisdom of people who have been there before. This would help you to look at your business honestly and assess what’s working and what isn’t.”
What are some of the opportunities that you see available in the Middle East logistics market today and what would be your advice to aspiring entrepreneurs?
“We see is a paradigm shift in the region as more and more customer touch points are going online, specifically in our industry. We are seeing more cargo-related functions migrating online. This transition will create new opportunities for entrepreneurs to step into this B2B space as we have seen in the B2C space, where both last mile and fulfillment have created new businesses opportunities.”