UAE-based logistics firm shits to cross-border e-commerce

Launched in 1982, Aramex is a huge shipping and logistic firm based in the United Arab Emirates. For many years, it has built its success in serving areas that other competitors ignore. It has now shifted its focus on cross-border e-commerce particularly in Africa and Southeast Asia.

The company has more than 18,000 employees in more than 500 locations in 69 territories. It is also a publicly traded firm. But while it is considered a leader in transportation and freight in the UAE, the company is now counting on e-commerce to fuel its growth.

Shift to cross-border e-commerce

The move to become a digital company was recently announced by Aramex. Its CEO, Hussein Hachem, believe it has become a necessity. He once acknowledged in an interview that while the firm has done great for the past 30 years, it is not sure whether the same type of business will be good enough for the next decade or so.  He added that if the company doesn’t change or adapt then it won’t be able to withstand a ‘storm of disruption.’

Hachem is looking at a business model in which any individual could become an Aramex courier. The firm will also offer franchise opportunities to transport and shipping firms in emerging markets.

How cross-border e-commerce affects the bottom line

Aramex derived a quarter of its annual revenue in 2016 from cross-border e-commerce.  The trend continues to grow with the firm expecting cross-border e-commerce to account for 30 percent of its revenue.

The firm will serve emerging economies in Asia, Africa, and the Middle East.  It is focusing on countries not served by other logistics and shipping firms.

The home market of Aramex, the Middle East, is not known for its cross-border e-commerce. This is despite the fact that wealthy residents in the region buy products online.