Imperial Logistics Acquires 50% of supply chain consultancy Volition

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Imperial Logistics and Volition Consulting Services (Volition) announced that Imperial Logistics will acquire 50% of Volition with effect from 1 July 2008, subject to approval from the Competitions Authority. Imperial Logistics and Volition will aim to improve their service offering whilst further increasing their footprint in the logistics and supply chain industry.

 
"We are excited about this new development involving Volition," Marius Swanepoel, Chief Executive Officer, Imperial Logistics told SmartProcurement. "Together we're already working on a number of integration projects. Based on the interaction and feedback from various customers, we believe that a more formal association between us will create further opportunities to apply our expertise to benefit our customers."

Imperial Logistics' comprehensive experience of logistics and supply chain management, complemented by Volition's supply chain consulting expertise is a win-win combination. The consulting services offered by Volition will be leveraged to expand the Imperial Logistics value proposition and both companies will jointly focus on integrated and end-to-end supply chain solutions. As a division of the leading third-party logistics (3PL) and supply chain management company in Southern Africa, Volition will continue to operate as an entrepreneurial and independent business, a model proven successful across the Imperial Logistics Group.

Cobus Rossouw.gif"Being part of Imperial Logistics will help us grow and capture new opportunities in the Southern African supply chain market, says Cobus Rossouw, Managing Director, Volition Consulting Services. " I am confident that the acquisition will allow us to further improve the value-add proposition to our customers and expand our supply chain expertise."

Imperial Logistics and Volition will target new business as well as growth opportunities within their customer base in a structured fashion and proceed in their strategy of increasingly becoming an extension and part of their customers' operations.  

Dougie Truter, CEO of Imperial Logistics' Consumer Products Division, will become non-executive Chairman of the Volition Board of Directors. Abrie de Swardt, Marketing Director of Imperial Logistics, will oversee Volition's interactions with Imperial Clients and Operating Companies and he will be appointed as non-executive Director. Cobus Rossouw remains Managing Director and David Long and Heinrich Strauss Executive Directors.

Following the transaction, Volition will be able to offer their customers 100% BBBEE procurement recognition, in line with Imperial Logistics' formal rating as Level 5 Contributor. Volition, as a division of Imperial Logistics, will continue to promote the pillars of transformation, focusing on people-related aspects like employment equity, skills development and corporate social responsibility.

Imperial Logistics and Volition are both active supporters of the supply chain profession and proudly active members of SAPICS and the Supply Chain Council. Volition is also a member of IPSA.  

About Imperial Logistics
Imperial Logistics is a leading third-party logistics (3PL) and supply chain management company in Southern Africa. The company provides customised value-added logistics services and supply chain solutions to blue chip customers in almost every industry. Imperial Logistics is 100% owned by Imperial Holdings and is home to 70 operating companies. In Sub-Saharan Africa operations are segmented into three key divisions, namely Transport and Warehousing, Consumer Products and Specialized Freight. Imperial Logistics has an international arm, focusing on European markets and comprises four operating units, namely Panopa Logistik, Neska, Imperial Reederei and Brouwer Shipping. For further information, please visit www.imperiallogistics.co.za.

About Volition Consulting Services
Volition's ideology is to passionately drive sustainable business improvement through applying the capabilities of our people, creating value for all stakeholders. As a professional services company, Volition offers specialist skills to address supply chain challenges. Volition employs more than 70 professionals who operate across Southern Africa. Its team is structured according to the skills required to support their clients' needs. Volition's expertise spans the end-to-end supply chain domain, including procurement, operations planning, distribution logistics and value chain integration. Their client base has expanded into all industry sectors, such as FMCG, Banking, Public Sector, Automotive and Mining Supply Chains, building long-term mutually beneficial relationships.


Questions and Answers about the Deal

Q: Which capabilities and services does Volition add to Imperial Logistics?
A: Volition will add supply chain related strategy, people, process and technology as well as professional services and consulting to Imperial Logistics' suite of services.

Q: Which capabilities and services will Volition develop further to enhance the joint Imperial Logistics / Volition value proposition?
A: As growth opportunities arise in the market specific capabilities will be targeted. Immediate opportunities include operations planning and operational transport optimisation.

Q: Will Volition terminate any services due to the formalised partnership with Imperial Logistics?
A: Although Volition will continue to design logistics service solutions, procurement of logistics services (RFQ or tender processes) will not be performed any longer - this will be done by the client or separate independent specialists.  Although Volition will retain independence, it is not realistic to expect Imperial Logistics' competitors to approach Volition for the evaluation of solutions. 

Q: Where will Volition fit into the Imperial Logistics organisation?
A: Volition will report into the Imperial Logistics Marketing Department to allow interaction with all the Operating Companies in Imperial Logistics.  Strategic and tactical support will be provided by Abrie de Swardt and Dougie Truter.  As with other Imperial Logistics Operating Companies, the management team remains responsible for delivering their budget and expected growth in earnings.

Q: Will Volition's marketing and promotion change?
A: Yes and No. Volition will leverage the Imperial brand in its marketing activities and Volition's consulting services will be promoted by Imperial Logistics' Marketing Department to the company's Operating Companies and customers as part of the broad spectrum offered by the Imperial Logistics. On the other hand, Volition's brand will continue to exist with its existing identity (with some exciting improvements coming soon) and business development will remain the primary responsibility of Volition's executives. 

Q: Will Volition's promote Imperial Logistics' services?
A: Yes, on the basis that these services will benefit clients and that the partnership between Volition and Imperial Logistics Operating Companies can contribute towards value for the client.  However, Imperial Logistics does not expect Volition to be biased towards the (logistics or technology) services of Imperial Logistics or Imperial Logistics Operating Companies in a way that compromises the client's requirements.  This same principle applies across the Imperial Logistics Operating Companies, where the primary driver is client requirements and not the marketing of internal capabilities.

Q: How will Volition's Technology Enablement capabilities be aligned with Imperial Logistics' offerings?
A: Opportunities and synergies will be identified over time.  In the short to medium-term, Volition will continue to provide independent, client specific technology solutions to better automate process and leverage information for decision making purposes.

Q:  Will Volition be integrated with the Imperial Logistics Marketing Department?
A: No, whilst Volition will report into the Imperial Logistics Marketing Department it will continue to operate as an independent operating business, similar to the other Imperial Logistics Operating Companies.

Q:  Will the Imperial Logistics Marketing Department be integrated with Volition?
A: No, the Imperial Logistics Marketing Department will continue to focus on developing the Imperial Logistics brand, formulate integrated supply chain management solutions and promote the broad spectrum of services offered by the Imperial Logistics Operating Companies. Although the addition of Volition's services and capabilities will strengthen the Imperial Logistics value proposition, the relationship will be on an arms' length to complement and supplement the services offered by Imperial Logistics Operating Companies.

Q: Will Volition provide services to Imperial Logistics Marketing Department?
A: Yes, Volition will work closely with the Imperial Logistics Marketing Department to develop integrated supply chain management solutions for Imperial Logistics clients providing that there is a commercial proposition for all stakeholders.  For these interactions, Imperial Logistics Marketing Department will be Volition's client - as is the case with Imperial Logistics' current engagement with Ellerine Holdings.

Q:  Will Volition provide services to the Imperial Logistics Operating Companies?
A: Yes, Volition will strive to establish mutually beneficial relationships with the Imperial Logistics Operating Companies on the basis of quality and cost-effective service provision.  No Imperial Logistics Operating Company will be expected to use Volition's services.

Q:  Will Imperial Logistics influence Volition client and/or business development?
A: Yes, Volition and Imperial Logistics Marketing and / or Operating Companies intend to embark on joint marketing initiatives where the need for professional supply chain services exists. However, Volition will remain responsible for marketing and business development, whilst realising potential synergies with new and existing Imperial clients.

Q: Will Volition introduce Imperial Logistics to its clients' solutions?
A: Yes, Volition will introduce Imperial to our client base where it makes sense. However, this does not preclude Volition from working in operations where other logistics service providers are currently contracted.

Q: What is the impact of the transaction on Volition's empowerment status?
A: Imperial Logistics has been rated as a Level 5 BBBEE contributor, effectively resulting in 100% BEE spent recognition since they are recognised as a value adding enterprise. Based on see through principles of ownership, Volition can assume the same BBBEE credentials.

Q: Will Volition change its historically aggressive approach to BBBEE now that Level 5 status is "guaranteed"?
A: No, although the transaction provides Volition with strong BBBEE credentials, we will continue to focus specifically on the pillars of BEE that promotes people and skill development.

Q: What happens to Orange?
A: Orange will remain independent businesses owned by some of Volition's executives.  The alliance agreement between Volition and Orange will continue where preferential rates are paid to Orange on the basis of Orange first-right of refusal to fulfil Volition's requirements.  Volition will continue to provide back-office administration services to Orange on commercial terms. Orange will provide services to Imperial Logistics and Imperial Logistics Operating Companies on an arms-length commercial basis on the basis of quality and cost-effective service provision.

Q: What happens to e-Logics?
A: e-Logics will remain an independent business in which some of Volition's executives own minority shareholding. The alliance agreement between Volition and e-Logics will continue, including project collaboration and back-office administration.  The potential conflict (or perceived conflict) between products provided by e-Logics (specifically LogicsLink) and other Imperial Logistics Operating Companies and/or Imperial Logistics (specifically i2) needs to be resolved / managed.  Volition will continue to provide back-office administration services to e-Logics on commercial terms.

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