Rangel Group accelerates growth in 2017

28 Apr 2017
Rangel Group accelerates growth in 2017 - News - Rangel
The Rangel Group posted 3.3% growth in sales last year, to around 158 million euros, and it expects to grow an additional 4.5% in turnover this year, to around 165 million euros.

"It was a good year for us, given the economic panorama. Around 70% of invoicing from our normal business activity in 2016 is related to exports and imports, to international transport. In our case, exports grew 0.9% in 2016. We grew above the market rate, which is positive. Even more so when exports to Angola decreased 30% and to Mozambique they fell 40%,” says Nuno Rangel, the group's CEO, in an interview with Jornal Económico.

Last year, Portugal's exports to the European Union grew by 4%. "In our case, our strongest market in the EU is France, where we recorded growth of 17% last year. We achieved new business. Spain is not such a priority market for the Rangel Group. We won logistic contracts, including warehousing, with Philip Morris, which is a specific service,” said the company manager, which maintained an exclusive worldwide partnership agreement with one of the US giants of the sector, FedEx.

The business mix is balanced between land transport (25%), logistics (23%), air/sea transport (18%) and international express (16%). At the end of 2016, the Rangel Group managed around 263,000 square metres of logistics areas and had 23,000 customers in all markets, 82% of which are customers in Portugal.  At the moment, the group transports cargo to 200 countries, which also represents growth, since it only transported to 197 countries in 2015: the three new markets to which the Rangel Group started to transport in 2016 were Kosovo, Iran and the Fiji Islands.

"We reach everywhere. It was a busy year, with significant investments. Much of it in infrastructures. Investment last year amounted to about three million euros, in particular in a new warehouse in Lisbon, in the enlargement of the headquarters, in the offices in airports, and in a new office in 2016. We also invested in Angola, expanding a positive cold store (frozen items),” says Nuno Rangel.

He also pointed out that the Rangel Group also invested around 2.7 million euros in launching new services, highlighting "a new line of business, which we called 'custom critical', because we felt that it met a management need and in which we have achieved advantages, because the Rangel Group offers a range of services that nobody else in the market has.”

This custom critical service is divided into two areas, ‘time critical’, for urgent deliveries, in a maximum time of 45 minutes. The second part is 'on board courier', which intends to transport what is essential for many industries, that of valuable parts, as is the case in the aviation industry when there are breakdowns of sensitive parts. A few weeks ago, for these reasons, the Rangel Group was responsible for transporting an airplane part from Chicago to England.
"Our path of evolution has been to grow and specialise, to find and develop market niches, to increasingly enter specialised areas of activity. The path of the Rangel Group in recent years has been to grow by specialising, by entering new market niches”, states Nuno Rangel.

Another new area of work for the group is 'special projects', which has to do with the delivery and distribution of oversized orders that do not fit into the other lines of business of the Rangel Group. "This is a project that is going very well”, says Nuno Rangel. "We have to grow more focused on growth in Portugal. We have reduced costs and undertaken some restructuring of the group. Of course, it would be nice if the economy was always growing in all countries, but we know that this is not how things work, unfortunately,” expresses Nuno Rangel with regret.

According to the CEO of the Rangel Group, by 2017, according to that budgeted, "we expect growth of 4.5% in turnover, to about 165 million euros. We are estimating there will be no further decline in Angola and Mozambique."

"Globally, our markets have been growing much more in this beginning of 2017 compared to the most recent identical periods. The month of January was an unusual month. Portuguese exports grew 14% in January and February. The month of March was also good. We are now closing the month of April. We have to see the effect that Easter had, following the effects of the public holidays and the month of August, which generate a reduction in our activity. Only after that can we take stock of the situation,” he cautioned. But only a global collapse could prevent the Rangel Group from raising its turnover by close to 5% this year.

The challenges of 'ecommerce'
The Rangel Group is more heavily backing e-commerce, a fast-growing business segment, a reality that has intensified since Portugal hosted its first edition of the Web Summit, last year. "In this case, we opted for the full outsourcing of e-commerce. We have been able to assemble a solution that ranges from the technological platform to the offer of services and products. It is a solution for companies that are not used to selling online, for companies that only sell offline, in physical stores. We offer a low cost and low investment solution to create services that can facilitate the online sales of companies,” explains Nuno Rangel, recalling that there is still a long way to go in this field "because the online market of the USA is nothing like that of the Portuguese market.”

In addition to wanting to continue investing in ecommerce, with the launch of new services only for this segment of activity and with the continued investment in the custom critical service, the Rangel Group will also continue to invest in information systems, improving energy efficiency, in technologies and in new products.

The Rangel Group currently has about 1,500 employees, after recruiting an average of 100 people per year over the last few years, mostly young people.

The group already leads imports from Asia

Exports to North America will be reformulated. Niches in the 'pharma', 'fashion' and 'wine’ markets are expanding.

The Rangel Group has decided to carry out a series of redefinitions in the import operation from Asia to Portugal by air and sea. "We have selected a new network of partners, we have defined new services with different 'transit times'. We did this job at the end of last year. And we have already begun to obtain great results. We registered growth of the import movement from Asia to Portugal of around 90% in January and February,” reveals Nuno Rangel.
This performance occurred despite Portugal's imports from China falling in that period, "which means that we are gaining new customers.” To achieve these results, the Rangel Group has set up a product manager in Asia because we wanted to have a leadership position.

"There may be other geographic areas where we are not leaders at the moment and we want to achieve that leadership. We are developing a redefinition operation similar to that undertaken for our export operations from Portugal to the USA and Canada. We are going to launch new partnerships in these markets, new services because we think we can take the lead,” also in this specific market.

The CEO of the Rangel Group also points out that another specialised service, which is that of pharma [for medicines and pharmaceutical products], launched several years ago, has grown so much that the Rangel Group has already claimed the leadership of the national market. "Last year we handled more than 100 million units of medicines,” he stated.

At the moment, the Rangel Group has about 70 customers in the 'pharma' area and makes about 35,000 deliveries per month in this area of activity. The products mostly come from Switzerland and Germany and are sent to hospitals, pharmacies. This is a complex process from picking to storage, which has to be done at 2ºC to 8ºC, because they are temperature-controlled products.

"We will invest two million euros in the launch of new products and another two million euros in the expansion of our 'pharma’ products distribution area, in a second new phase of expansion of our terminal for this division in Montijo. What we have planned until the end of this year is to increase this 'pharma' area up to nine thousand square metres, in a location near the current warehouse. This expansion may also happen early next year, depending on the market. What is certain is that now, in the current logistics warehouse for 'pharma’, we are already at 100% occupancy,” states Nuno Rangel.

Another service recently launched by the group is wine distribution, Rangel Wine Logistics, which required the setting up of a customs post in Lisbon. "This service is intended for producers with no space to put their 'stocks'.
They can transfer their stock to our facilities where we also offer a collection service at any winery in Europe - Italy, France, Spain or Portugal - which allows us to consolidate loads in Portugal that are heading to Brazil. This benefits the transport operator and reduces their costs. We are providing a greatly facilitated process. And it is a service essentially invoiced in Brazil,” explains Nuno Rangel.

Rangel Fashion Logistics is another new services area of the group, "which has been very successful, very focused on the textile and shoe market. It has been going well and essentially uses European land transport.”
Nuno Rangel promises that the group plans to launch new services and products, following the strategy of the last three or four years in which, "after securing the major lines of trade, we have been entering niche markets or specialised business areas.”