The route via the Baltic Sea
Two experts share their ideas on how to save the Finnish transit logistics industry. p. 8
Lea and Taisto
Lea directs and Taisto barks p. 19
A unifying force in the Russian railway freight industry
nurminenlogistics.com
Magazine for Stakeholders 1/2013
News
Nurminen Logistics’
Nurminen
An interview with the Executive Director of the Council of Railway Operators. p. 22
V.Somerpuro
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Contents
V.Somerpuro
16 Eila Kiretti is responsible for ensuring that the company’s result information is numerically correct and prepared in a timely manner.
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8
Nurminen Logistics is present at the ports of Hamina, Kotka, Vuosaari, Tallinn, Riga and Klaipeda
19
Lea and Taisto are training Schutzhund.
1/2013 3 Editorial The role of design in logistics.
4 Experience
enthusiasm
and
Strong know-how and enthusiastic learners in Nurminen Logistics’ future.
5 Nurminen
Now
Annual report 2012: Net sales increased and the operating result improved significantly.
6 Customer
satisfaction
Customers value Nurminen Logistics’ high service quality
8 The
route via the Baltic Sea Mervi Nurminen and Olli-Pekka Hilmola share their views on the future of transit logistics in Finland.
Nurminen News 1/2013
14 The
centerfold
shows Nurminen Logistics’ transit routes. Nurminen Logistics has a strong presence in the key ports for container traffic on the Baltic Sea.
16 An
Accounting Manager on the job Eila Kiretti ensures that Nurminen Logistics’ result is correct and timely.
19 Taisto
protects Lea
Forwarder Lea Salonen recharges her batteries by doing Schutzhund activities with her dog Taisto.
20 Taking
on new tasks
Introducing new Nurminen employees as well as those who have taken on new tasks.
22 The
Council of the Railway Operators brings together the key players in the Russian railway freight industry An interview with the council’s Executive Director Dmitry Korolev.
26 References Uralchem is Russia’s largest and the world’s second-largest manufacturer of ammonium nitrate and also the second-largest manufacturer of nitrogen fertilisers in Russia and the CIS countries.
3
Editorial
Inspiration from design V.Somerpuro
O
ur capital, Helsinki, was the World Design Capital in 2012. The purpose of being the World Design Capital is to highlight design in a novel and diverse way. Published in early March, the project’s final report concludes that, thanks to the project, design has become a topic and a social factor and that with the aid of design problems have been solved in various environments. Furthermore, business life has also begun to understand the significance of design as a competitive advantage. All in all, the World Design Capital year can be considered a success. For Nurminen Logistics, 2012 was a successful year, too. The company managed to improve its profitability in each business unit and achieved the best result in its history as a listed company. In January–February, our customers assessed Nurminen Logistics’ services in a customer satisfaction survey. The results show that customers particularly appreciate expertise and professional competence as well as service-mindedness and a good attitude. More detailed information about the results of the survey can be found on pages 6–7 of this magazine. Nurminen Logistics wants to give its customers a head start in their businesses through high-quality service solutions. By constantly improving the quality and usability of its services, Nurminen Logistics also contributes to the development of design. In 2012, inspiration from the World Design Capital year and our day-to-day work gave rise to Nurminen Logistics’ own pattern, which can be seen as the background for this page. The pattern is a Finnish design by Superyellow Design Oy. It combines soft elements, stars and birds, symbolising continuous movement and renewal, with trucks, wagons and terminals with which Nurminen Logistics’ professionals tackle our customers’ logistics challenges. s
Laura Jokinen is Communications Manager of Nurminen Logistics.
We hope you enjoy reading this magazine and we also wish you a brilliant summer!
Nurminen News 1/2013
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Nurminen NOW
Top3: Experience and enthusiasm
Nurminen Logistics’ vision for 2015 is to be the most reliable and high-quality international provider of rail transport and a significant provider of logistics project services and solutions in Russia, its neighbouring countries and Finland. Company’s experience of the Russian logistics market and a modern own fleet play a key role in this effort. Nurminen also invests in the future by inspiring young people to get involved in the wonderful world of logistics.
Nurminen News 1/2013
Logistics’ Board of Directors
Alexey Grom (41), First Vice President of the Russian logistics group FESCO, has been nominated for election to Nurminen Logistics’ Board of Directors. Mr. Grom has twenty years of logistics experience in Russia. He began his career in 1993 in a Dutch forwarding company and subsequently became the CEO of ZAO Transkom in 1996. In the 2000s, Grom worked as a sales director for ZAO Russkiy Mir and as the CEO of ZAO Jukos-Transservis. In 2007, Grom was appointed the General Director of OOO Firma Transgarant, and in 2009 he became the Vice President for Rail for the FESCO Group and a member of the company’s Executive Board. Alexey Grom has held the position of First Vice President at FESCO since 2012. The decision on the selection of the new member will be made by the Annual General Meeting on 15 April 2013.
Nurminen Logistics 3 becomes the business mentor for Vuosaari upper secondary school
Vuosaari upper secondary school in Helsinki is the only upper secondary school in Finland that offers specialised studies in logistics. In autumn 2012, Nurminen Logistics and Vuosaari upper secondary school launched a partnership aimed at bringing students closer to logistics through company visits and other forms of cooperation. Logistics was introduced as a subject of study by Vuosaari upper secondary school in the 2007–2008 academic year. The curriculum is based on, among other sources, the operations management course at Aalto University School of Business, the content of which has been modified for the upper secondary level. The teachers of the upper secondary school have received logistics education at Aalto University School of Business. The upper secondary school offers a total of five logistics courses, with a total enrolment of approximately 70 students in the 2012– 2013 academic year.s
Nurminen Logistics
Nurminen carried out a major transport project for the Finnish boiler plant manufacturer KPA Unicon in early 2013, transporting three boilers and other cargo to Novorossiysk on the shores of the Black Sea. The project involved three boilers loaded in Denmark, weighing 45 tonnes each with a height of 4.2 metres, as well as containers and an oversized tank from Finland. The total volume transported was approximately 1,600 cubic metres. The project was carried out on a door-to-door basis. Nurminen was responsible for cargo pick-up at manufacturing facilities, handling at ports, loading on a ship, sea transport as well as further transport involving reloading at Novorossiysk port to the unloading site after the customer handled the customs processes.
V.Somerpuro
Nurminen Logistics
Large boilers Alexey Grom 1 transported to 2 nominated for the Black Sea election to Nurminen
Nurminen NOW
Nurminen Logistics in 2012: Net sales increased and the
operating result improved significantly
President and CEO Topi Saarenhovi describes 2012 as a turning point for the company. – Our profitability improved in every business unit, and the overall improvement even outpaced our expectations. We grew our business operations, particularly in the active markets of Russia and its neighbouring countries. The company’s largest business unit, Railway Logistics, developed particularly strongly. We were successful in developing our Russian organisation. The profitability of Transit Logistics increased significantly in Nurminen Logistics’ Baltic operations. This increase was due in particular to the growth achieved by our Lithuanian subsidiary in the container export market and the higher activity in container traffic to Russia and Central Asia through the Baltics. We achieved positive development in the profitability of Special Transports and Projects. This was mainly due to strong growth in special transports and projects delivered to Russia and its neighbouring countries. In 2013, the focus of our business
Fact box • Net sales were EUR 78.4 million (2011: EUR 76.6 million). Reported operating result was EUR 5.4 million (EUR 1.9 million). • Operating margin was 6.9% (2.5%). • Operating result excluding nonrecurring items was EUR 5.6 million (EUR 1.1 million). • EBT was EUR 4.0 million (EUR –0.7 million). • Net result was EUR 2.7 million (EUR –1.5 million). • Earnings per share, undiluted: EUR 0.05 (EUR –0.19). • Earnings per share, diluted: EUR 0.05 (EUR –0.19). development will be on growing our railway logistics business in Russia and its neighbouring markets. We will continue the project to expand our fleet of rolling stock that began in 2011. We also aim to grow our project transport business in Russia and its neighbouring markets and increase profitability in Vuosaari and
Finnish operations divided into two separate companies Nurminen Logistics turned its Finnish operations into two independent companies at the beginning of 2013. The Forwarding and Value Added Services, Railway Logistics, and Transit Logistics business units are now Nurminen Logistics Services Oy, and the Special Transports and Projects business unit is Nurminen Logistics Heavy Oy. The Group’s Baltic operations were also restructured, with the companies responsible for Estonian and Lithuanian operations transferred directly under the parent company in late 2012. The Group management and supporting functions remain in Nurminen Logistics Plc, which provides the Group companies with financial and administrative services. The restructuring is purely administrative in nature; with it, the company streamlined its legal structure and cost allocation to current business operations. Personnel were transferred to the new companies under unchanged terms of employment. s
across other operations through various means, including the improvement of operational efficiency, Saarenhovi adds.
Outlook Nurminen Logistics expects its net sales and operating result to be at the same level as in 2012 and earnings per share to improve. The company’s long-term goal is to grow at a faster rate than the market, on average by over 15% per year. Going forward, over 50% of net sales will come from the growth markets of Russia and its neighbouring countries. The company’s further long-term goals are to improve profitability, achieve an operating profit level of 10% and return on equity of 20%. The text is based on Nurminen Logistics’ Financial Statement Release published on 26 February. More information on Nurminen Logistics’ operations and result in 2012 is available in the Annual Report. Order the Annual Report as a hard copy or read the electronic version at www.nurminenlogistics.com. s
Vote for the best article in this magazine and win a softshell jacket! As the best article of Nurminen News 2/2012, the readers selected Slava is Nurminen’s Traffic Superman, which described the work of the Imatra-based Slava Gladilin. The article received 26% of the votes. The next most popular articles were the story about service productisation at the Vuosaari logistics centre and The teacher’s pension goes into coffee and stamps, a story on investor Erkki Sinkko. Both received 19% of the vote. A one day in Stockholm cruise with Silja Line in a Deluxe class cabin was raffled among all voters and the lucky winner was Seija Hummelin-Uusilehto. Congratulations to the winner! Enjoy the cruise! You can vote for the best article in this magazine at www.nurminenlogistics.com. All voters will be entered into a lucky draw with a Grizzly Tulsa softshell jacket. The voting ends at the end of September 2013. s
Nurminen News 1/2013
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Customer satisfaction
Customers value Nurminen Logistics’ high service quality Nurminen Logistics conducted a customer satisfaction survey in January-February 2013. The survey covered all of the company’s active customers. Approximately 200 customers from around the world responded to the survey.
Room for improvement The customer satisfaction survey asked respondents to choose from the list provided the three most impor-
Nurminen News 1/2013
No decline in sight in the demand for logistics services Only 3% of the companies that responded to the customer survey believe that the need for logistics
Nurminen
NEWS
d Services turne into products has been
Nurminen Logistics turning operations by developing its products. p. 8 its services into
Petra judges vaulters
t Petra Skog Executive Assistan equestrian is a pioneer of p. 18 vaulting in Finland.
stics.com
Going forward, the company will pay particular attention to developing these areas. The issue of quality was also highlighted in responses to the survey questions involving comparisons with competitors. Respondents considered Nurminen Logistics to have a high level of quality compared to its competitors, which may indicate that the industry as a whole is faced with a need to improve quality further. Activity and flexibility were highlighted as other key competitive factors for Nurminen Logistics.
The customers who responded to the survey indicated that they find Nurminen News to be a useful and interesting publication. Around 78% of respondents stated that they have received useful information regarding the company and its services from the magazine, and the responses also indicate that the magazine plays a role in shaping Nurminen Logistics’ corporate identity. We are eager to develop not only our services, but also this magazine. With this in mind, we are always pleased to receive feedback and story ideas. Please send your feedback and suggestions through our website at www.nurminen logistics.com or by e-mail to info@nurminenlogistics.com s
Stakeholders
Around 97% of respondents would recommend Nurminen Logistics to colleagues.
Nurminen News also received positive feedback
nurminenlogi
Praise for personnel The customer satisfaction survey included questions on the availability and competence of Nurminen Logistics’ sales staff as well as the effectiveness of offer calculation services. Our customers stated that Nurminen Logistics has active sales operations and the sales staff are easy to reach. Respondents were also satisfied with the speed of response in making offers. Placing orders for services was considered easy. Customers value the expertise of our sales staff and regard Nurminen Logistics’ sales competence to be at a high level. In addition to sales, the company’s entire personnel received good scores for professional competence and service-mindedness. Respondents indicated that Nurminen Logistics’ employees have a very good service attitude.
tant development areas for Nurminen Logistics. The top three areas chosen were pricing, service coverage and quality.
Magazine for
R
espondents indicated that the services they receive from Nurminen Logistics meet their requirements. Around 97% of respondents would recommend Nurminen Logistics to colleagues.
tics’ Nurminen Logis 2/2012
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Life of an investor
been property has Erkki Sinkko’s investing in acquired through 22 companies. p. Finnish listed
Customer satisfaction
Veikko Somerpuro
services will decline in the future. Respondents to the survey included a variety of companies from many different industries. Around 43% of respondents are in the logistics or warehousing industry and 40% in manufacturing. Another 8% are in the wholesale and retail trade. Approximately 65% of respondents have an annual turnover in excess of EUR 10 million. Nearly one third of respondents have used Nurminen Logistics’ services for over 10 years, and just over 10% for less than two years. Slightly over 50% of respondents based their responses on dealing with the Vuosaari office. Around 36% are Special Transports and Projects customers and the rest are fairly evenly divided between other Nurminen Logistics offices and departments. The results of the customer satisfaction survey will be reviewed by each business unit and the necessary actions will be taken based on the results to develop operations further. s
Customer’s evaluation of all services (1–5) Competence of sales staff Service attitude of the personnel Ease of reaching the salesperson Professional skills of personnel Ease of placing an order Competence related to Russia and CIS Ease of reaching personnel Clarity of offers Service coverage Offer delivery time Quality of transport Service flexibility Reliability of schedules Availability of stock Accuracy of invoicing Sufficiency of contacts Clarity of invoicing Flexibility of delivery times Complaint handling Price competitiveness 0,00 0,50 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 5,00
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8
Transit traffic
photos Veikko Somerpuro
Nurminen News 1/2013
Transit traffic
The route via the Baltic Sea What will happen to transit traffic passing through Finland when Russia invests heavily in its own ports? We spoke to two experts to ask them about their views on the state of transit traffic.
Nurminen News 1/2013
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10
Transit traffic
I The Baltic Sea route The route via the Baltic Sea ports is the most important transportation channel in freight traffic between the European Union and Russia. Approximately 40% of Russia’s foreign trade goes through the Baltic Sea ports. The route runs from the Western European ports (e.g. Antwerp, Hamburg, Lübeck and Rotterdam) via the Motorway of the Baltic Sea through ports in Finland, the Baltic countries or Russia to the final destination country, mainly to Russia. s
n Russia, the economy is growing and the standard of living is rising, which also means that freight traffic is increasing. During the past few years, Russia has invested hundreds of millions of euros in the development of its ports, especially in the Gulf of Finland region. Vysotsk, Primorsk, the ports of St. Petersburg and Ust-Luga are developing, but the problems that the ports are facing, at least for the time being, include a poor transport network and delivery fleet needs. Russia needs to solve these problems. – The strategy of the state of Russia was to direct 70% of its imports through its own ports by 2012 and 95% by 2020, says Mervi Nurminen, Director of the North European Logistics Institute. Mervi Nurminen has followed the development of the logistics industry closely for years. After working in business life, she is now employed by the North European Logistics Institute (NELI). NELI is a logistics development programme for Kymenlaakso for 2007–2013, governed by Kymenlaakso University of Applied Sciences.
”
Finland should draw up a national transit traffic strategy. Mervi Nurminen
– In Kymenlaakso, the share of the logistics industry in employment is significant. The logistics sector is the fourth largest employer in the province, providing jobs to approximately 9,500 people. In contrast, the forest industry, a traditional field of employment, employs only approximately 5,600
Nurminen News 1/2013
”
people. The multiplier effect of jobs in the logistics industry is great as well. Indeed, the primary aim of the logistics strategy of the Ministry of Transport and Communications is to improve
My remedy for Finland’s transit traffic is scheduled block train traffic and entrepreneurship. Olli-Pekka Hilmola
Finland’s logistics competitiveness, explains Mervi Nurminen. Mervi Nurminen has a solution to the threat posed by Russian ports to Finland’s transit traffic. – The route through Finland should be quickly included as an accepted route in the traffic strategy that Russia is preparing and that extends all the way to 2030. In addition, Finland should draw up a national transit traffic strategy. Regular block train traffic also from Finland Olli-Pekka Hilmola, Professor of Logistics at Lappeenranta University of Technology, believes that regular block train traffic could be a driver for a new upward trend in Finland’s transit traffic. – In the next ten years, Finland will have good opportunities in transit traffic, but only if it is arranged as scheduled block train traffic to Russian destinations that are further away than St. Petersburg. This will clearly highlight the cost benefits of railway freight. The bottleneck of Russian logistics is the road infrastructure: despite investments, it will be in a difficult state in the coming years. Furthermore, in
Transit traffic
Global logistics as a core competence Nurminen Logistics is present at the ports of Hamina, Kotka, Vuosaari, Tallinn, Riga and Klaipeda. In today’s world, competitiveness requires that a company has global and efficient networks. In global operations the customer will reap the benefits as Nurminen Logistics can operate freight from the location that is the most cost-effective option for the customer, depending on the value added or other services needed. Factors in favour of Finnish ports include safety and efficiency. In addition, in import transportation for the Far East, for instance, sea freight prices for containers are lower in HaminaKotka than in the Baltic countries due to Finland’s export traffic and its need for containers. Smooth border crossings along railways could also be considered an advantage of the traffic between Finland and Russia. In the Baltic countries, ports were designed in the Soviet era and their infrastructure is extremely well suited for Russia’s export. The ports are state-owned and charge no fairway dues. In addition, they utilise a great deal of EU subsidies. When compared to Finnish ports, the other competitive advantages of ports in the Baltic countries are more flexible working hours, lower salaries and the personnel’s knowledge of Russian. s
Goods transited through Mussalo include home electronics shipped to Russia.
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Transit traffic
The Baltic countries live on transit traffic In Estonia, Latvia and Lithuania, young people leave the country to seek a better life elsewhere – except those who work in the banking sector or in logistics. Nurminen Logistics has offices in the largest container ports in the Baltic countries: Tallinn, Riga and Klaipeda. Of all container transportation in the Baltic countries, 80% is transit traffic and there is hardly any exports. Consequently, transit traffic is an important source of income and employment in the Baltic countries. Andrey Dobrynin, Commercial Manager at Nurminen Maritime Latvia, a subsidiary of Nurminen Logistics, believes that, in future, consumption – and with it container transportation – will increase in Russia. – Of the Baltic Sea ports, Riga is located closest to Moscow, the region’s largest consumption centre. Nurminen Logistics participates in regular block train traffic from both Tallinn and Riga to Moscow. Through Klaipeda, we can offer good, cost-effective transit traffic service to the Belorussian and Ukrainian markets. Andrey Dobrynin believes that block train traffic has a bright future in the Baltic countries. – Once electronic customs clearance becomes fully functional, demand for this service will surely grow. s
Nurminen News 1/2013
future, Russia’s WTO membership will be favourable for railways as customs differences and traffic tariffs will be harmonised, notes Hilmola. According to Olli-Pekka Hilmola, Finland should renegotiate the socalled connecting traffic agreement for railway traffic with Russia so that private enterprises could also pull trains. Currently, this activity is a monopoly of Finland’s and Russia’s national railway companies. – The situation is the same as if, for example, a truck transportation leaves Vuosaari in Helsinki for Oulu but switches trucks in Jyväskylä. The existing approach is not rational in the current tough competitive situation, and it certainly does nothing to reduce costs. My remedy for Finland’s transit traffic is scheduled block train traffic and entrepreneurship, says Hilmola. s
Developing Hamina into a project port In late 2012, the Port of HaminaKotka concentrated its dry bulk traffic to Kotka. In this change, all container and RoRo lines were transferred either to Mussalo or to Hietanen. HaminaKotka would like to strengthen the role of the Port of Hamina as a chemical and project port because, for instance, the port’s well-functioning infrastructure and renewed fairway provide an excellent environment for project vessels. Indeed, the area has already attracted new investments and new types of traffic. Nurminen Logistics uses its terminal at the Port of Hamina as a consolidation point for major projects. The Port of Hamina is located only 35 kilometres from the Russian border. s
Transit traffic
Nurminen Logistics
Extensive experience of special transports in Belarus and the Baltic countries ​ urminen Logistics has extensive experience of special transports N in Belarus and the Baltic countries Successful transport projects require careful planning, experienced drivers and good local contacts. Nurminen Logistics recently carried out two major projects that involved transit through the Baltics.
I
n the period from September to December 2012, Nurminen Logistics transported a number of parts for a hydroelectric power plant to Belarus from Klaipeda in Lithuania. A total of 11 units were transported to two destinations in Belarus, Novolukolm and Beloozersk,
with the heaviest units weighing 137 tonnes. The length of the hydroelectric power plant parts ranged from 18 to 26 metres, with a width of 3.65 metres and a height of 3.6 metres. The combination vehicles used were a 4-axle truck and a 15-axle modular trailer.
In March 2013, Nurminen Logistics transported a rotor weighing 110 tonnes from Minsk in Belarus to Ventspils in Latvia. The rotor was 12.5 metres long, 4 metres wide and 3.78 metres high. The rotor was transported on a 13-axle modular trailer pulled by a 4-axle truck. s
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Transit logistics on the Baltic Sea The route via the Baltic Sea ports is the most important transportation channel in freight trafďŹ c between the European Union and Russia. Nurminen Logistics has a strong presence in the key transit ports for container trafďŹ c on the Baltic Sea: HaminaKotka, Tallinn, Riga and Klaipeda.
A regular weekly block train connection from Riga to Russia
Murmansk
Of the Baltic Sea ports, the Freeport of Riga is located closest to Moscow, the region’s largest consumption centre. Around 80% of the cargo handled by the port is transit cargo to or from the CIS countries. Nurminen Logistics offers a regular weekly block train connection from Riga to Moscow. The company also offers terminal services, harbour services and forwarding at the Port of Riga.
Tallinn handles containers in Muuga and projects in Paldiski
Arkhangelsk
In terms of tonnage, Tallinn is the fourth largest port on the Baltic Sea after Primorsk, St. Petersburg and Klaipeda. There is a regular block train connection from Tallinn to Russia. The port is also an important centre for project transport, with a variety of RoRo liner traffic to major European ports. Nurminen Logistics’ other services in Tallinn include harbour and terminal services as well as forwarding.
Klaipeda offers flexible access to the Belarussian and Ukrainian market
Kotka
Hamina
Finland
Klaipeda is the northernmost ice-free port on the eastern coast of the Baltic Sea. The Port of Klaipeda is Lithuania’s main transport hub, where sea and land routes meet. The best route to Belarus and Ukraine passes through Klaipeda. Nurminen Logistics offers forwarding, harbour and terminal services at the Port of Klaipeda. Nurminen Logistics’ Lithuanian company is also a COSCO container line agency in Lithuania.
Russia
St. Petersburg
HaminaKotka is Finland’s largest port for general cargo, exports, container traffic and transit logistics. HaminaKotka comprises Mussalo, Hietanen, City Terminal, Puolanlaituri, Halla and Sunila in Kotka, as well as Hamina Harbour. Located 35 kilometres from the Russian border, Hamina Harbour is Finland’s easternmost port. HaminaKotka’s strength is in sea freight, as import and transit containers are used for Finnish industrial export needs.
Tallinn Sweden
Estonia
Versatile storage facilities in Mussalo
Riga
Moscow
Latvia
Klapeida
Denmark
Lithuania
Nurminen Logistics offers a comprehensive service concept at the best location in Mussalo Harbour. The company has its own warehouse facilities at Mussalo for a variety of needs: warm and cold storage, special storage for packaged hazardous chemicals as well as storage facilities for value added services. All of the storage facilities are customs warehouses. Nurminen Logistics also has a forwarding office in Kotka to provide customers with all the necessary documentation. From Mussalo, goods are transported by road or rail.
Hamina is an excellent location for project consolidation Republic of Belarus
Poland Germany
In addition to forwarding and value added services and transit warehousing, Nurminen Logistics’ Hamina unit has excellent facilities for project management: a fenced outdoor storage area, two rails into the terminal and temperature-controlled indoor storage space. With unobstructed access to the port by rail, road and project ships, Hamina is an excellent project consolidation location.
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On the job
Keeping a keen eye on the result
1 2
Eila Kiretti works as Accounting Manager at Nurminen Logistics’ headquarters in Vuosaari. She is responsible for ensuring that the company’s result information is numerically correct and prepared in a timely manner. In addition to herself, Eila’s team consists of a chief accountant and three other accountants. According to Eila, the tasks of an Accounting Manager require a good understanding of business operations. In addition, one must be able to consider the special characteristics of the logistics industry in accounting, such as issues related to periodic customs clearance. As Eila has also worked in operational roles, she finds it easier to cooperate and understand the effects of different issues on accounting. Accounting requires perseverance and a will to develop things. Good spirit within one’s own team is crucial. A manager also needs to know how to listen; according to Eila, true listening skills also increase one’s own competence. Eila acts as a link between business operations and financial management and she guides, monitors, supports and develops operations. Eila’s team also works in close cooperation with the accounting team at Nurminen Logistics’ St. Petersburg office. In addition to the process of turning business operations into independent companies, this spring Eila has been busy with two other projects: speeding up results reporting and invoicing. In connection with these projects, Eila has visited nearly every Nurminen Logistics’ office during the first months of the year and met with the people who are responsible for the correctness of results or the speed of invoicing at these offices. The personnel have had a chance to voice their opinions and raise any challenging issues for consideration. Eila is truly happy about how active and positive the personnel have been at all the offices. This has yielded good ideas and the means for achieving the common target. Of invaluable help in these projects has been Department Manager Anu Ravi-Nurmela from the Vaalimaa office. During her career, which has spanned 35 years, Eila has witnessed many changes at Nurminen Logistics. Eila has actually left the company on two occasions in search of new challenges, but both times she was asked to come back. Indeed, Eila jokes she is a sort of temporary employee, with her most recent spell as a temp now lasting about 14 years. Over the years, Eila has become proficient at change management. However, she emphasises that any change needs clear targets as well as sufficient time and resources. When Eila is not working with result information, she looks after Nurminen Logistics’ company car fleet. According to Eila, tasks related to company cars are really nice as they offer an opportunity to get to know her colleagues from a different perspective. Cars are always an emotional issue. s
3 4
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Veikko Somerpuro
5
FACT BOX Eila Kiretti, Accounting Manager • 35 years at Nurminen Logistics • Enjoys gaining comprehensive industry expertise. • Does not like ambiguous goals. • In her free time, she studies mental wellbeing, which she considers extremely important in different fields of life. Has a wide range of hobbies, ranging from stone grinding to karaoke.
On the job
17
Charging the batteries
FACT BOX • The Schutzhund test has three phases: tracking, obedience and protection. • The tracking phase usually takes place in a field. Depending on the test’s level of difficulty, the track is 300–800 steps in length and 20–60 minutes old. Along the track, there are two to three dropped articles that the dog must indicate. • The obedience phase includes heeling, stopping, retrieving, send outs and staying in place. • The protection phase takes place in a field with six blinds. The dog is directed by the handler to systematically search the blinds. When the dog finds the helper in the last blind, it must immediately begin intensive guarding and non-stop barking. The dog must respond to any attacks or escape attempts by the helper by biting a padded sleeve. Source: Finnish Working Dog Association
Nurminen News 1/2013
photos: Veikko Somerpuro
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Charging the batteries
Taisto protects Lea Lea Salonen, a Hamina-based Forwarder, spends her free time in forests and fields with Black Chance Merlin, a.k.a. Taisto, a handsome male German shepherd dog. They both enjoy the training sessions, which are punctuated by Taisto’s enthusiastic barking. What is Schutzhund? Schutzhund is a sport for service dogs. The objective is to pass the Schutzhund test. The Schutzhund test was developed in Germany in the early 1900s to support dog breeding when people realised that German shepherd dogs are not only excellent herders of sheep, but also highly useful working companions for law enforcement and military personnel. The Schutzhund test has three titles, each progressively more advanced, and three phases: tracking, obedience and protection. Are dogs trained to be aggressive? Of course not. Dogs enjoy protection activities. Training is a form of play for them, and they get rewarded for barking at the target person. Their play instinct is triggered by the blind where the helper hides and the protective sleeve he or she wears. Without these stimuli, Taisto would simply wag his tail. I don’t know of any Schutzhund dogs that have attacked a person. Taisto is a gentle dog that sleeps on the sofa and loves children. What does it take to do Schutzhund training and pass the tests? Schutzhund is the most demanding of all service dog sports. Passing the tests requires a skilled handler and a dog with the right character traits. You have to start when the dog is still young, but even that doesn’t guarantee success. The dog must have cour-
age, perseverance and endurance. An active, intelligent and confident dog is best suited to this sport. Starting Schutzhund training also requires the trainer to pass a licence test. Where do you do Schutzhund training? Protection training is usually done together with other Schutzhund enthusiasts. One of the best things about the sport is working with likeminded people. We used to train in Kotka, but these days we drive to Hamina because that’s where our helper for protection training lives. Tracking training can only be done in the summer, but we train obedience and protection two to four times per week even in the winter. We also attend the Finnish German Shepherd Dog Association’s camps or organise our own. How do you find volunteers to help with protection training? The willingness to have dogs bite you on a protective sleeve alone is not enough, it takes more to be a helper in protection training. The helper is also a trainer and needs to undergo extensive training. Our helper, Jarkko Leinonen, has Schutzhund experience at the world championship level. Do you have goals? There are three titles to be obtained in Schutzhund testing. Here in Finland, they are IPO1, IPO2 and IPO3.
When you have passed the most advanced test, you can enter the Finnish championship competition. The top five finishers in the Finnish championship qualify for the world championships. Taisto and I passed IPO1 last summer. This year, we will try to pass IPO2 and IPO3. Why did you choose Schutzhund? My uncle had German shepherd dogs when I was young. I loved playing fetch with them and grew attached to the breed. I’m also a competitive person and enjoy challenging hobbies. I decided to try Schutzhund with Taisto and he enjoyed it. It has since become a big part of our lifestyle. You also have to make sure the dog is physically fit, which takes lots of swimming, running next to a bicycle or wading through snow. The hard training pays off when you see the dog’s satisfaction at receiving the helper’s protection sleeve as a reward for a job well done. s
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New tasks
Elina made the change to Sales Assistant Elina Pelkonen Sales Assistant, Niirala
You made the change from Forwarder to Sales Assistant at the beginning of February. What inspired you to apply for the new position? The job seemed interesting and it’s nice to change your perspective and learn new things. How does it feel to work in sales? I haven’t formed a comprehensive impression of it just yet, but thus far my new tasks have been enjoyable and varied. I look forward to finding out what else this position holds. What do you do in your free time? I spend a lot of time with friends and family. I also do various types of physical exercise and I’m involved in organisational activities. This winter, I’ve also spent a fair bit of time tuning my motorcycle for the upcoming riding season. s
Nurminen News 1/2013
New tasks
Tanja Eskolin
Teppo Suhonen
Executive Assistant, Vuosaari
Forwarder, Vainikkala
You joined Nurminen Logistics from the non-profit sector, where you also worked as an Executive Assistant. What are the requirements of the job? First and foremost, working as an Executive Assistant requires a positive attitude, hard work and situational intelligence.
You have worked as a Forwarder since the start of the year. Before the change, you worked as a Terminal Foreman. How did you end up making the change? Last autumn, I was offered the opportunity to work in forwarding on a temporary basis. The change was later made permanent. I was enthusiastic to try my hand at a new job. You have to take the bull by the horns when the chance arises.
What does your work involve? I am an assistant for the CEO, CFO and other members of the Executive Board. I handle calendar management as well as meeting arrangements for the Board of Directors and the Executive Board. I also make travel reservations, process travel expense reports and manage our contract archives. In addition, I serve as the assistant to the general counsel and handle a number of other administrative office duties. s
Do you have any regrets about the change? What do you miss from your time working in the terminal? I have no regrets whatsoever. I enjoy it here and the reception has been great. I already knew the other forwarders and my attitude could be summed up as “new day, new challenges�. I’ve realised that the knowhow I accumulated working in the terminal since 1995 is very useful in my day-to-day work as a forwarder. Of course, I occasionally miss my old colleagues in the terminal, but I can always stop by to see them at the warehouse or meet up when we are off work. s
Tarja Turunen
Natalia Shubarina
Sales Assistant, Vainikkala
Accountant, St. Petersburg
You moved to sales after nearly seven years as a forwarder. What are your thoughts on the change? I think versatility and having a wide range of skills is always an advantage when it comes to organising work and handling day-to-day matters. A good workplace provides employees with opportunities to rotate jobs, which opens doorways to personal development and testing your skills.
What got you interested in Nurminen Logistics as an employer? I graduated from university in summer 2012, having majored in accounting. I saw an ad for the open position and immediately became interested in the opportunity to work in an international company and develop my professional skills. I really like it here. We have a good working atmosphere in the office.
What do your duties as a Sales Assistant involve? I work as a Sales Assistant in Railway Logistics. For the most part, I help my more experienced colleagues in their highly varied jobs. I also maintain various systems and customer data, assist in tender calculations and handle other day-to-day Sales Assistant duties. s
What does working as an accountant require? Above all, an accountant has to be meticulous and precise. You also need good analytical skills. A good accountant must continuously develop his or her professional expertise. s
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photos: Ruslan Shamukov
In the same boat
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In the same boat
The Council of Railway Operators brings together the key players in the Russian railway freight industry To a foreigner, the name “the Council of Participants in the Market of Railway Rolling Stock Operators’ Services” evokes images of official premises decorated with marble columns and gold framed mirrors. In reality, the council does practical work in an ordinary office to find constructive ways of bringing together the various players in the Russian railway freight industry.
O
n the eight-lane ring road nearby, cars are zipping by and the air is heavy with springtime street dust. Entering the fifth stairwell of a large office complex and going up to the fourth floor, you find the glazed door to the Council of Railway Operators. The council was established in 2009 by rolling stock operators. Its primary purpose is to develop the Russian rail transport market by coordinating collaboration between OAO RZD (Russian Railways), the Russian Ministry of Transport, the Federal Tariff Service and other government bodies. It aims to influence national decision-making and participates in the drafting of various action plans, cooperates with the Federal Service for Supervision in the Transport Sphere on technical matters, is involved in handling issues related to tariffs and develops new methThe Executive Director of the council Dmitry Korolev evaluates issues from the consignor’s perspective.
ods to improve the efficiency of railway operations. Dmitry Korolev has served as the Executive Director of the council since its inception. – When OAO RZD established Freight One in 2007 and transferred its high-sided open VOK wagons and special wagons to the new subsidiary, it became clear that there was a genuine market for private operators and a new organisation was needed to coordinate cooperation in that market, Korolev says. The Council of Railway Operators is a registered company that operates as a self-regulatory organisation, which is a corporate form used in Russia. According to Korolev, under current Russian law the selfregulatory organisation is practically the only possible form of operation for an organisation such as the council. A self-regulatory organisation must be non-profit, bring together the actors in a given industry and have a minimum of 25 members. The conditions governing the operation of a self-regulatory organisation are laid down by
law. The basic idea of this corporate form is to create a supervisory organisation for a specific industry that has representation by both the state and market operators. The council was granted this status on 20 April 2011. The supreme authority of the Council of Railway Operators is wielded by the Executive Committee, which is comprised of 16 members. The Chairman of the Executive Committee is Sergey Maltsev, CEO of Globaltrans. The Executive Committee discusses and decides on the organisation’s key statements. While the council has a corporate form, it does not operate under a typical corporate structure. Instead, its operations are based on working groups. – When an important question or change pertaining to the railway industry arises in public discussion or otherwise, the council sets up a working group comprised of its own personnel as well as external experts. The working group will investigate the matter and prepare a proposal for the Executive Commit-
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Samassa veneessä In the same boat
tee on what actions should be taken, if any. If the Executive Committee approves the proposal, it is submitted to the authority in charge of the matter, such as OAO RZD or the Russian Ministry of Transport, Korolev explains. From a coordinating body to an active player Recently, the Council of Railway Operators worked hardly with a change in railway tariffs that resulted in the harmonisation of tariffs on empty wagons. Prior to the change, the transport of empty wagons was subject to tariffs according to the category of product most recently transported in the wagons. As a result, it was not economical to move empty wagons that had recently been used to transport expensive products subject to class 3 tariffs very far to be loaded with new cargo. This led to operators keeping wagons idle while they waited for cargo nearby, causing unnecessary congestion on the rails. The amendment to the tariff rules allows empty wagons to be moved to their next loading station under a uniform tariff. One of the current major issues concerns the extension of the max-
imum service life of wagons. Wagon manufacturers have proposed a legislative change to the government to discontinue repeated extensions to the service lives of wagons. The service life of a freight wagon is approximately 15-32 years depending on the wagon type, but this can be extended by decades by filing an application. This, of course, is not in the interests of the wagon manufacturers. According to Kommersant newspaper, the main opponent of the legislative amendment preventing the extension of the service lives of wagons is OAO RZD’s subsidiary Freight One, which stands to be severely hit by the change in legislation due to its enormous and old fleet. In Febru-
A short history of private wagon operations According to Dmitry Korolev, the private operations in Russian rail transport can be compared to using a paid shopping cart at the supermarket: you rent the cart, use it to transport your products, and then return it. The development of the operator market began in earnest in 1998 with the establishment of the first commercial structure to supervise the export of oil-based products. Quite soon the government realised that the state did not have sufficient resources to manage the railway network, locomotives and rolling stock. The rolling stock needed to be renovated. A tariff system was created and it made possible to invest to a new wagons and develop the market. Private operation soon proved that transport volumes could grow even with a smaller combined fleet. Liberalisation also led to more reliable wagon delivery times, which pleased buyers and the receivers of shipments. At present, railway operators can operate throughout the 1520 track gauge area and compete with no geographical restrictions. s
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ary, the Council of Railway Operators proposed to the Russian government that the law prohibiting the extension of the service lives of wagons could be implemented gradually, and that wagons manufactured in Russia could be excluded. – Decision-making is not always easy in the Executive Committee, as its members include various stakeholders of different sizes and they sometimes have conflicting interests. The debate regarding the issue of extending the service lives of wagons will go on, Korolev says. Nurminen Logistics’ wagons are among the most modern in Russia. The company currently ranks seventh among rail operators in terms of the age of its fleet. Any legislative amendments pertaining to the extension of the service lives of wagons would not have a significant impact on Nurminen Logistics’ fleet for several years. The changes to the extension of service lives have been debated in the context of numerous recent freight wagon accidents. Twenty coal wagons were derailed in January, resulting in two fatalities. Approximately 20% of the railway wagons currently in use in Russia have had their service lives extended by application. Korolev suggests that there may be other factors behind the recent accidents.
In the same boat
Fact box Dmitry Korolev • Born 23 February 1967 • A graduate of Bauman Moscow State Technical University • In the transport industry since 1993 • An advisor to CEO of OAO SIBUR • Executive Director of the Council of Railway Operators since 2009 • Evaluates issues from the consignor’s perspective and does not think the Executive Director could be a paid employee of an operator.
– At the beginning of the 21st century, the requirements governing wagon manufacturers were made less stringent, resulting in thinner structures being used for the bodies of wagons. These changes have now begun to cause problems. Driven by common interests The Council of Railway Operators is currently comprised of 33 member companies. Together they own 800,000 freight wagons, which represents roughly 70% of the total number of 1,158,000 wagons registered in Russia. As such, the council can be considered a significant player in the Russian railway freight industry. In spite of its name, the council does not only advocate the interests of rolling stock operators, but rather the interests of all players in the rail transport market. – We have established a coordination group that serves as a permanent advisor. Representatives of consignors and their associations, the state, financial institutions and wagon manufacturers, and experts in rail transport, economics and legislation,
among others, are invited to the coordination group. The Council of Railway Operators is the first and currently the only organisation of its kind in the industry. According to Dmitry Korolev, there shouldn’t be more than one such organisation. – Having multiple organisations would only lead to conflicts of interest, as the various players in the industry often have substantial differences in their views, Korolev explains. The market is changing Rail transport in Russia has been an operator-dominated market practically since its liberalisation. However, this changed in 2012 due to an oversupply of wagons and a decline in prices. In 2013, it appears that buyers are calling the shots instead of operators. – The prevailing market conditions have led to a period of corporate restructuring and mergers between several operators. I believe that consolidation will continue and the number of operators will fall, Korolev says. Finally, we had to ask Dmitry Korolev for his opinion on the proposed changes to operator status that have been mentioned in previous issues of this magazine. One of the proposed ideas is to categorise operators by size and allow them to only operate in a specified geographical area. – Transport volumes to the east are currently at record levels. Traffic in the western regions is primarily cargo transported from the ports, or transit traffic through the Baltic countries. Eastern traffic is growing rapidly and all operators must be allowed to operate freely there and elsewhere in the 1520 area, now as well as in the future. s
Highlights
1
The Council of Railway Operators was established in 2009. The founding members were 12 rolling stock operators with a combined total of some 70,000 wagons.
2
The council currently has 33 members with a combined total of 800,000 wagons, representing approximately 70% of the total number of 1,158,000 wagons registered in Russia. Nurminen Logistics’ Russian subsidiary has been a member of the council since 2010.
3
The Council of Railway Operators is open to members who are concretely involved in the operation of railway wagons. Wagon owners, such as leasing companies, are not eligible for membership. An additional requirement is that a member must have a company-owned fleet of a minimum of 1,000 wagons, although this requirement is likely to be discontinued. In addition to the current members, there are approximately 10 to 15 potential member companies in the Russian market. Members sometimes leave the council due to financial reasons. s
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References
Ruslan Shamukov
Uralchem Uralchem is Russia’s largest and the world’s second-largest manufacturer of ammonium nitrate and also the secondlargest manufacturer of nitrogen fertilisers in Russia and the CIS countries. The company uses a broad range of rolling stock, from chemicals wagons to covered wagons, for transporting both raw materials and finished products. Some 95 per cent of the finished products are transported by rail to end customers or ports. OOO Uralchem-Trans is responsible for the rail transport of Uralchem Group’s raw materials and finished products. Nurminen Logistics transports Uralchem’s finished products in its own covered wagons to various destinations in Russia, Kazakhstan, Latvia and Lithuania.
According to Nurminen:
We are pleased with our cooperation with Nurminen Logistics. Nurminen is a flexible and reliable provider of highquality wagons for our use. We expect Nurminen Logistics to be a stable and long-term partner for us. With this in mind, we are planning to increase our transport volumes for wagons provided by Nurminen Logistics. We are also looking to develop the cooperation further, for example in the area of container transport, and we are interested in using Nurminen Logistics’ services for return transport from Finland, for which we will use our own rolling stock. Dmitry Ryabov Senior Vice President, Transport OOO Uralchem-Trans
Our cooperation with Uralchem began in summer 2012. We currently provide 20 covered wagons per month for their use. Uralchem is a very important customer for us and we can offer them high-quality service and rolling stock when they need it. s
Nurminen News 1/2013
Dmitry Lukshin Sales Manager Nurminen Logistics
Read more references: www.nurminenlogistics.com
” ” According to the client:
This spring, Nurminen Logistics will attend the TransRussia Exhibition in Moscow on 23–26 April 2013 and the Breakbulk Europe 2013 Conference and Exhibition in Antwerp on 14–16 May 2013. As the largest international logistics industry event for Russia, the CIS countries and the Baltics, TransRussia is an important meeting place for logistics professionals. In 2012, the event featured 523 exhibitors from 29 countries and was attended by a total of 24,233 visitors. This year’s TransRussia event will be held at the VVC All-Russia Exhibition Centre. Nurminen Logistics’ stand at the exhibition will be in booth A505, hall 75A. Register and print a free ticket for admission to the fair at www.transrussia.ru. Breakbulk Europe is the continent’s largest and most significant event for special and project transport. The conference and exhibition is attended by all of the leading special transport providers, forwarders, ports and terminals that handle oversized cargo. In 2012, the event featured over 200 exhibitors and attracted over 5,000 visitors. Breakbulk Europe 2013 will be held at Antwerp Expo in Antwerp, Belgium. Nurminen Logistics will be on hand to present its services and solutions in booth 519H1. More information on the event is available at www.breakbulkevents.com.
We look forward to seeing you in Moscow and Antwerp!
Nurminen Logistics provides high-quality logistics services, such as railway transports, terminal services, forwarding, special and heavy transport and value added services. The company has collected logistics know-how from three centuries, starting in 1886. Nurminen Logistics’ main market areas are Finland, the Baltic Sea region, Russia and other Eastern European countries. The company’s share is listed on NASDAQ OMX Helsinki. Nurminen Logistics’ stakeholder magazine. Editor-in-Chief: Laura Jokinen. Editorial Board: Laura Jokinen, Risto Holopainen, Janne Lehtimäki, Risto Miettinen, Artur Poltavtsev and Hannu Vuorinen. Texts: Laura Jokinen. Cover photo: Sebastian Söderlund. Centrefold graphics: Sebastian Söderlund. Layout: Indicio Oy. Printed by: Libris Oy. ISSN 1797-8963.
Head Office Satamakaari 24 FI-00980 Helsinki, Finland Tel. +358 10 545 00 Fax +358 10 545 2000 info@nurminenlogistics.com www.nurminenlogistics.com