Outsourcing within the shipping and logistics industries will continue to strengthen as companies seek to control their costs by focusing on their core operations, says the executive chairman of GAC, Björn Engblom.

According to Engblom, fierce competition, driven by globalisation and consolidation, made it essential for companies to enter partnerships that freed them from operational tasks that were not among their core strengths.

While ‘arms-length’ outsourcing deals continue to increase, there is also an increase in ‘up-close’ outsourcing, where a service team works inside the client company as a provider of expert support in logistics, 3PL, freight forwarding, and an increasing range of shipping services.

“Companies are realising that a more integrated relationship with an expert service provider can bring huge advantages by delegating previously in-house tasks and letting the company focus on what it does best,” said Engblom.

In Logistics, Engblom said that closer relationships, built on performance and trust, will see service providers handling all procurements for manufacturers – not only managing raw materials in and finished products out, but also taking care of all other supplies and materials a company might require in its day-to-day business.

“Having started as a small Swedish-managed shipping agency in Kuwait in 1956, GAC expects its next fifty years to be driven by closer long term relationships with customers and a stronger link between profitability and sustainability,” concluded Engblom.