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Transformation Journey

Transformation Journey
Publication: Mediacat
Spokesperson: Billur Kaymak Burkutoğlu, Deputy General Manager of Aras Kargo Marketing
1. First of all, let's start with the Turkish shipping sector. Shipping was one of the sectors that boosted its business volume during the pandemic period. What does the Turkish shipping sector look like since March?

Over the past year, we have witnessed a pandemic process that is a first for the modern world. The extraordinary conditions that have arisen as a result have radically altered the way of doing business and the lifestyles of economies, companies, and individuals, i.e. all actors in the economic value chain. In particular, there have been rapid and visible changes in consumption patterns.  This situation has also affected our sector. E-commerce has always had a significant share in our turnover. It has taken on a new dimension with the pandemic. We believe that the share of e-commerce in general trade will continue to increase. This share, which was 8 percent in 2019, increased to 18 percent in the first half of 2020 and is expected to increase even more in the second half of the year and continue to increase in the years to come. The task of passing on this rising demand to buyers falls to us, the shipping sector. 

2. What was the pandemic process like for Aras Kargo?

This state of affairs also affected our business volume and triggered significant changes in our business model. It honestly felt like trying to change all 4 wheels of an Aras Kargo vehicle whilst it's on the move at a speed of 100 kilometres on the highway. We have seen the following fundamental changes in our company:

\\tThe number of parcels our Marketplace and E-commerce customers asked us to ship has doubled.
\\tOn the other hand, the number of parcels from our B2B customers shipping from company to company has decreased.
\\tWhile before, we used to drive to one point and drop off 100 parcels, our business model has changed completely: We drive to 100 points and drop off one parcel.
\\tIn this new business model, we are driving to many more addresses and carrying much smaller parcels.
\\tConsequently, the number of addresses we visit every day increased from 500 thousand to 1.3 million. When the year ended, we had visited 200 million addresses, which means we visited the population of Turkey more than twice.
In an attempt to respond to these increases;
\\tWe accelerated our investment in automation in 2016 through our Digital Transformation Investment Plan, relocating half of our 28 transfer centres across the country and taking on larger square footage for new lines.
\\tWe revamped our call management processes from the ground up, increased our call answering capacity by two and a half times and improved the voice response system so that our customers can access the information they are interested in much faster. This has enabled us to significantly reduce the number of calls and complaints.
\\tWe enforced the introduction of a flexible workforce model..
\\tWe have overhauled our mapping infrastructure and reduced the error rate in the arrival centres.
\\tAnd we have achieved all these changes in cooperation with our 15.000 teams working on the ground every day.

We thus ended up as the player with the highest hourly transaction capacity in the sector. We were able to respond continuously and regularly to the increasing demands of our clients and told them that we got'em. The more we carried their parcels, the more they favoured us, thus making us the market leader in many segments. 

3. Where do the expectations of private and corporate clients deviate? What are the changing or even unchanged dynamics in relation to these target groups during the pandemic period?

Basically, our customers' experience journey deviates at some points in terms of being shippers or only recipients. While the shippers are our direct customers who choose the shipping company, the recipients are only indirectly our customers. When they seek to provide a service in return, they also become the shipper. We follow our customers' experience journey through 4 critical processes: The Emergence of Need and Company Preference, the Shipment Delivery Process, the Shipment Delivery Process and the Post-Delivery Process. The first two processes are done for shipments only, while the last two processes are done for both shippers and receivers.

As we look at the dynamics that define customer satisfaction, we find that the ranking of importance to our corporate and retail customers differs. The 3 issues that our corporate customers place the utmost importance on are the following Service competence (with sub-issues such as stability of management, adequacy of products and services, and technological competence), delivery performance and branch service performance. The top 3 items to which our customers attach the greatest importance are: Delivery performance, adequacy of information services and complaint management performance.

Over the past 2 years, we have invested 300 million TL in an effort to improve our operations and IT infrastructure. These investments were extremely beneficial in maintaining our performance in all these areas during the pandemic period. We are thus very pleased that we were able to increase our market share in this difficult year by increasing our customers' satisfaction and that we were named the most respected shipping company of the year. We plan to invest another TL 1 billion over the next 5 years. Our investments will centre on improving customer satisfaction and capacity. To enhance the customer experience, we will create alternative delivery models, offer convenient real-time shipment tracking and flexibility for the recipient, and further increase the effectiveness of our self-service channels. We will continue to invest in automation and route optimisation to improve the overall capacity.

4. As consumer demand has increased online, so have the serious disruptions in the supply chain. How has this situation affected your technology and operational planning?

As Aras Kargo, we are encircled by a process in which we are transitioning from an operational company to a technology company. We are making our technological investments from two points of view: Subsidiaries and Transfer Centres.

To name our investments in our branches; We initiated our Uninterruptible Data Backup project to prevent our operations from being interrupted in the event of natural disasters and earthquakes by backing up our machines. A centralised data system project eliminated erroneous data by collecting customer data previously held at branches into a single centre. With the self-service application we developed, we pioneered our SMEs' transition into the digital world. We scaled up our mapping infrastructure to handle the increasing address and data operations and launched the Courier Route Optimisation project. We made investments in our handheld terminals for instant access to data. We further developed our self-service applications and renewed our voice response system and mobile application. We diversified our shipment delivery method. We launched contactless delivery with ID card scanning and SMS code. To optimise this process and ensure that our customers can reach us at any time, we have completely improved our call management processes. We have also increased the capacity of our call centre by 2.5 times.
As for the Transfer Centre; Making it easier to manage time and capacity, we have tripled our hourly processing capacity and are now among the best in the industry, boosting our capacity by more than 300 percent through our automation investments in 8 transfer centres.
5. It is no secret that sustainability is a must for today's logistics industry. Aras Kargo has also taken initiatives in this regard. How far have you come with the electric vehicle fleet you have built up over the last few years, and how close are you to the goal you set?

Sustainability is one of the priority strategies embedded in our core growth strategies. As Aras Kargo, we take a very sensitive approach towards this issue.
- In 2011, as part of our efforts to reduce our environmental footprint, we started to include electric vehicles in our fleet. We are the first shipping company in Turkey to have a 100 percent electric commercial vehicle fleet. We also have a plan to further expand our range of electric vehicles.
-We have a platform called Nature-Friendly Aras Team. In the framework of this platform, we are working with TURMEPA. Over the course of four years, we have prevented almost 4 tonnes of waste from polluting the environment on 15 different coasts in Turkey. Not only that, we also contribute to sustainable living by providing coastal clean-up training to our employees and their families.
-We have planted more than 14 thousand saplings under the same platform.
We are committed to reducing our carbon footprint and pursuing environmentally friendly investments.

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