Successes and challenges in the logistics industry. An interview with Andrzej Bulka, CEO of Fracht FWO Poland

Successes and challenges in the logistics industry. An interview with Andrzej Bulka, CEO of Fracht FWO Poland

How do you see the condition of the logistics industry in Poland in the context of the ongoing war in Ukraine? Is Fracht FWO Polska ready to cooperate with the military – Polish Armed Forces during this difficult time?

Every logistics company, operator and carrier is feeling what is happening in the world. The war has made transportation a non-issue, and everyone in the logistics industry, including large corporations, has taken steps toward new business solutions. As freight forwarders, we have undoubtedly gained from this unpleasant situation. Weapons and special goods to Ukraine are supplied by more than a dozen countries. The fact that Poland has become a logistics hub and military cargo is transported through it makes us a participant.  The facts speak for themselves – we make money from the war. Certainly, the war in Ukraine has reminded us how important a role logistics plays in the supply chain. The situation is unique, but I must emphasize this, the logistics industry is stable.

Fracht FWO Polska is good known as a provider of logistics services in the energy sector. Are you ready to cooperate on projects related to the construction of a nuclear power plant in Poland?

Of course. We are ready for any project related to energy, no matter whether it is a coal block, a gas block or the construction of a nuclear power plant. Each realization of this type carries similar challenges. On the other hand, a lot depends on what locations are indicated by investors. We feel absolutely ready to cooperate with the energy sector. Leaving aside the aspect of technical documentation, which is specific to the nuclear business, the mechanisms of operational and logistical operation are nevertheless no different from other projects carried out by Fracht FWO. Organization of transportation, obtaining environmental and transportation permits, environmental interference are the stages of operations for deliveries we face. We never foresee an easy path, rather a high staircase, which customers have been going through with us and will continue to go through. For us, however, the most important thing right after customer satisfaction are the transportation challenges, and with this we are doing very well and are among the top companies in the world. As part of the Fracht Group, we have arranged deliveries for such projects, including to Hinkley Point in England.

What kind of innovations or new logistics solutions does Fracht FWO Poland plans to implement in the context of the construction of a nuclear power plant in Poland to meet the challenges of such a large infrastructure project?

Regarding innovation, we would not like to reveal all the cards.  Although there have been no such projects in Poland to date, we have the know-how to take care of the logistics topic comprehensively in this regard. Innovations will certainly be in the preparation of transport infrastructure, i.e., last-mile deliveries, where engineering expertise is needed in the design and hydraulic works necessary to improve access infrastructure. We at the Fracht Group have a lot of experience in this issue.

The Dolna Odra project was one of the important undertakings of Fracht FWO Polska. Could you summarize this project and its impact on the company’s development?

The Dolna Odra project was one of the most demanding projects we’ve faced in Poland, following experience gained on deliveries for the construction of new coal-fired units in Opole or Jaworzno, and during hundreds of various other industrial deliveries made by the Fracht FWO team.

It ended successfully for several reasons. First, we had perfectly organized cooperation with suppliers, an excellent team of project managers, as well as experienced support from our colleagues in the international team of the Fracht Group. Deliveries were carried out by sea, by inland waterway, also by road. We also did not avoid minor problems, but anyone who is close to infrastructure projects knows that a project is not often successful without them. Of course we came out of each challenge on top.  Inland shipping played a very important role in the project, such as the delivery of turbines or other components, which were transported by river roads in Poland and Europe. A spectacular event was the transport of stators from the GE plant in Wroclaw by a very unusual route because it took place by rail transport to the ports of the Tricity, then by sea pontoon with transshipment on a barge in Szczecin to a specially built wharf right next to the power plant. These types of transports usually take place in direct relation factory – foundation site. This time, due to different conditions, the transport took place in such an unusual way. We delivered cargo from China, France, Turkey, and the complexity of the project was at the highest level, and this by no means involved deep-sea transports, but the transport of generators from Wroclaw, which are normally delivered by rail. The Dolna Odra project is several thousand freight tons of various types of cargo. Very large geographic disparity; modules from Asia, turbines from France, transformers from Turkey, generators from Poland. It was by far the most demanding project we have ever experienced in Poland.

How do you assess the economic situation in Poland and the world in terms of the condition of the logistics industry? What challenges and opportunities do you find on the horizon?

Consolidation is taking place in global logistics, which is not good news for customers. The largest logistics operators are companies that benefit from scale and often from the advantages afforded by their ownership structure. Many of them today have state-owned entities among their shareholders, such as in Germany or France. Affiliation with state-owned railroads or the postal service offers a number of advantages, such as easier access to cargo. Conglomerates are being formed that combine not only the service of a logistics operator, but also a shipping company or airline. A large part of the global market is handled today by just a few companies, which are making more and more acquisitions. The barrier to entry in the ocean freight forwarding market is high, but still leapable for certain players operating locally. In air freight, on the other hand, it is virtually impossible, even for a company as large as ours, with more than 100 branches around the world. As for road transport, it is governed by its own rules and regulatory players have a big influence on how it works. At the moment, we are seeing a decline in transport volumes from corporate customers. Payment terms may prove to be a problem, and this is where I expect the situation to worsen. Smaller trucking companies oriented towards cooperation with logistics operators will go through the difficult period a bit more smoothly, but entities that have direct contracts with long payment terms and that have invested significant sums in modern fleet or telematics solutions may collide with the problem of profitability.

CSR is an important part of Fracht FWO Poland’s activities, especially in the field of sports. Can you talk about Dorota Borowska’s role as Fracht FWO Polska’s sports ambassador?

CSR is an important pillar in the Fracht Group’s policy. We in Poland focus on sports, supporting the professional development of employees and a healthy lifestyle. The company’s development can be chronologically compared to the sporting development of Olympian Dorota Borowska – our sports ambassador. We started our cooperation with Dorota when she was 10 years younger, and also Fracht FWO Poland was just beginning to spread its wings. Now Dorota is a mature athlete and we as a team have also come out of junior age currently fighting for the biggest projects in the country. Hard work does reward and what we do in life should be treated long-term. With Dorota we share similar goals and values, which make our cooperation valuable and mutually worthwhile.

What kinds of ESG activities does the Freight Group undertake, especially in the context of environmental, social responsibility and sustainable management activities?

At present, the organization worldwide is developing in a responsible and sustainable way. This is not only the result of pressure from regulators, investors, customers, but also from employees themselves and other stakeholders. The Fracht Group has also seen a change of course towards even more responsible business precisely through the ESG standards being introduced. Fracht FWO Poland is part of the Basel-based Fracht Group, and the Swiss as a society pay very close attention to environmental protection and human relations, including social responsibility. In the Fracht Group, a number of activities have been conducted for years, such as cleaning up parks, forests, social actions, involvement in local authorities, local governments. We are very open to the initiatives of our employees. We engage completely selflessly and out of the need of the heart in helping victims of wars, earthquakes or other emergencies. We have quite a few examples of activity both globally and locally through cooperation with NGO’s, programs to activate sports growth of youth, etc.

Andrzej Bułka, President of the Management Board of Fracht FWO Polska Sp. z o. o. He has been associated with the transport and logistics industry for over 25 years. In 2010, he headed Fracht FWO Polska as its managing director, and since 2019 he has been the President of the company’s management board. He gained his professional experience as a merchant navy officer, and then developed his professional career in international logistics companies. A graduate of the Navigation Faculty of the Maritime University of Szczecin. He completed postgraduate studies in leadership psychology at the Business School of the Warsaw University of Technology and Advanced Management Program at IESE in Barcelona. International logistics expert, panellist and speaker at conferences and economy events in Poland and abroad.

Last Updated on August 10, 2023 by Anastazja Lach