Aramex chief executive Hussein Hachem is using new technologies to speed up delivery times and pinpoint customers exact locations
When the East India Company managed to slash postal delivery times from six months to two in the 1830s by using steamers to cross the Middle East to Bombay, it was hailed as a miracle of modern technology.
These days, Aramex promises to deliver mail in as little as three hours in some of the 70 countries in which it operates.
But even that is not quick enough, says the Middle Eastern postal giant, which is introducing new technology to enable customers to track their parcels by mobile phone and give them direct access to couriers, who will be able to pinpoint their location without the need for a centralised customer service desk.
“I think this whole address thing is going to become obsolete. Your address is going to be your mobile,” says chief executive Hussein Hachem.
“I don’t want to hold you hostage to your physical address and tell you to wait for me for two or three hours until I deliver, which is currently the process for everyone. That does not make sense.
“Technology is overcoming this address thing and we as a company are becoming agile and flexible to accommodate you as a consumer.”
It is the latest innovation from the first and only company in the Middle East to list on the Nasdaq stock exchange in New York (then relisted on Dubai Financial Market three years later) and one of the biggest success stories of Arab entrepreneurialism.
Prompted in part by the rise of online shopping in the region – currently one fifth of Aramex’s business but growing year on year by about 30 per cent – the firm aims to shift its focus from one of business-to-business to business-to-consumer and eventually, that of consumer-to-consumer.
But for a firm which has always prided itself on being at the forefront of innovation and risk-taking, isn’t it a little late to the party? Companies like Uber, the limousine service, and SmartJet for private jet clients have already been using such technology to track customers through mobile phone applications for some time.
“There is a major change happening within the organisation itself,” says Hachem.
“There is a shift of trade from corporate to consumer. With the internet and online shopping, companies like us have to change – in our mindset, our investments and our structure – so I can cater to the needs of the consumer. We need to understand our customer base here more.
“Technology at least for the last seven or eight years has been overwhelming. We need to make sure we embrace change and are ready for it. I don’t want to be a dinosaur.”
Hachem has big shoes to fill. He follows in the footsteps of Fadi Ghandour, who founded Aramex with William Kingson in 1982 and retired as chief executive three years ago, although he continues to sit on the board as vice chairman.
The company originally aimed to replicate the success of US firms like Fedex by delivering in the Middle East at a time when no other courier firms dared to do so.
But as well as being a great success story of Arab enterprise, it had something else – Ghandour’s personal vision and reputation as a risk-taker and a beneficiary of young start-ups. His angel investment fund supported the likes of companies like Duplays, which organises sports events, while he mentored smaller companies on a regular basis.
Hachem, 44, might lack Ghandour’s charisma but like his predecessor, he is a graduate of the school of Aramex and is key to the company’s vision with a sound understanding of its customers.
Like Ghandour, the father-of-three joined Aramex fresh from university and has stayed with the firm ever since.
As a business administration graduate from the American University of Beirut, Lebanon-born Hachem was playing basketball with Ghandour in 1991 when his mentor casually suggested he go to Kuwait to manage a new operation there. In the wake of the first Gulf War, it was no easy task.
“I was a management trainee,” says Hachem. “At the time, Kuwait was burning in flames – but at 21, I was running Aramex Kuwait and from there, the journey started.”
After a stint in Sri Lanka, where he set up a new base, he moved to Dubai 14 years ago as head of the Middle East and African division, which generates the largest revenue stream for the firm.
Since he took over at the helm of the company, it has acquired Mail Call Couriers in Australia for just under $27 million, expanding its Asia-Pacific coverage with a firm which pledges delivery times of three hours, including in the evening.
The acquisition of PostNet in South Africa extended its counter network by 270 offices, serving the community there with express and domestic deliveries as well as offering digital services to small and medium enterprises.
And last year, Aramex launched a Biocare medical courier service in the Middle East and North Africa, enabling hospitals, laboratories, clinics and pharmaceutical companies to send and receive samples within 72 hours.
All of which saw Aramex – which has 14,000 staff in 360 offices – with a net profit increase of 13 per cent by the third quarter of last year, mirroring the previous year when it closed at 15 per cent above 2012.
Revenue last year was around the $1 billion mark with profitability in the range of $75 million.
But it is the rise of e-commerce – expected to be worth $15 billion in the Middle East this year, according to PayPal Mena – where Aramex sees its most lucrative potential.
As well as introducing mobile phone technology to speed up delivery times and profile customers to aggressively target them with products to meet their needs, secure lockers will be installed this year across residential communities in the Middle East and Africa, starting in Dubai this quarter.
Accessible 24 hours a day, they will give another means for customers to pick up their post using a pin code sent to their phone when a delivery arrives and giving them three days to collect their parcel at their convenience.
Meanwhile, Aramex’s flagship shop-and-ship service has just been launched in Australia and will be set up in the UK this year.
The firm is now looking to extend its network in Sub-Saharan Africa and Asia. Offices have opened in Botswana, Angola, Ghana and Djibouti with more on the horizon in Namibia, Zambia and Nigeria.
“We continue to expand our footprint either through direct acquisition or by a franchise representation,” says Hachem.
“In each and every country, I represent the social fabric of that country. I just want to make sure I deliver happiness.”