SAL Invests 1.5 Billion SAR in the Logistics Industry

Introduction

In the rapidly evolving world of logistics, SAL Saudi Logistics Services has emerged as the National Logistic Champion, spearheading the growth and development of the industry in the Kingdom of Saudi Arabia. With a strategic vision and a commitment to excellence, SAL has made substantial investments amounting to 1.5 billion SAR to reinforce its position as a leader in cargo handling, logistics and fulfillment, & warehousing. In this cover story, we explore SAL’s ambitious investments, including the development of stations, expansion plans in key cities, automation and digital transformation initiatives, the introduction of Jeddah Courier, and the company’s mission for sustainability.

SAL: The National Logistic Champion

SAL was established in December 2019, following Saudi Airlines Cargo Company’s division being incorporated into a separate legal entity, to act as a pivotal catalyst in driving KSA’s economic transformation and the Kingdom’s aspiration of becoming a global logistics hub.

SAL has earned its reputation as the National Logistic Champion through its relentless pursuit of excellence and dedication to providing cutting-edge logistics solutions. As the leading cargo handling and logistics provider with

95% market share in Saudi Arabia, SAL plays a pivotal role in supporting the Kingdom of Saudi Arabia’s economic growth and delivering seamless logistics solutions both domestically and internationally. The company operates across all Saudi Arabia’s airports, including presence at the four key hubs of Riyadh, Jeddah, Dammam, Madinah and across all domestic stations.

SAL handles majority of the country’s inbound and outbound air cargo, making it a logistic services champion within the Kingdom and a key driver in the sector’s transformation outlined in Vision 2030. With its extensive network spanning 18 airports across the KSA and 50 international destinations, state-of-the-art facilities, and unwavering commitment to customer centricity, SAL has become the go-to partner for businesses across various industries.

The company’s comprehensive range of services that span the logistics value chain from ground handling, warehousing, and storage to distribution and last-mile delivery. SAL’s unique selling point lies in its ability to offer specialized and tailored end-to-end solutions that seamlessly integrate with the e-commerce supply chain. The company’s dedication to customer satisfaction, continuous improvement, and investment in technology has allowed it to stay ahead of the curve, making it the go-to logistics partner for numerous e-commerce and air cargo giants.

Scale of Operations and Key Role in the Growth of KSA Logistics Sector

SAL’s extensive operations have played a pivotal role in the growth and development of the logistics sector in Saudi Arabia. The company operates 162 sqm of state-of-the-art warehouses strategically located throughout the Kingdom of Saudi Arabia’s 18 airports. These facilities are equipped with advanced technology and automation systems effectively.

With its large fleet of vehicles and a well-established network of distribution centers, SAL ensures swift and reliable deliveries to different areas. The company’s commitment to meeting the evolving demands of e-commerce has positioned it as a key player in the logistics landscape, enabling businesses to expand their reach and cater to a broader customer base.

SAL’s Commitment to Sustainability and Environmental Responsibility

SAL recognizes the importance of reducing its carbon footprint and has implemented various measures to minimize the environmental impact of its operations. The company has made substantial investments in eco-friendly technologies and practices to ensure more sustainable logistics operations.

One of SAL’s notable initiatives is its focus on optimizing transportation routes and vehicle utilization to reduce fuel consumption and emissions. By implementing advanced route planning systems and adopting efficient logistics practices, SAL has exemplified a strong commitment to sustainability and environmental responsibility within the logistics sector.

According to their website, SAL has established clear goals to reduce carbon emissions, enhance energy efficiency, and promote sustainable practices throughout their operations. They aim to align their efforts with local and international regulatory requirements, such as Saudi Arabia’s Vision 2030 and its environmental protection initiatives.

By prioritizing sustainability as a core component of their corporate social responsibility (CSR), SAL recognizes the significance of integrating environmental stewardship into their business strategy.

This approach enables them to effectively manage environmental risks, drive innovation in logistics solutions, and meet the increasing expectations of customers, stakeholders, and society at large. Through sustainable practices, SAL is actively contributing to a more sustainable and greener logistics sector while ensuring a resilient and future-proof business model.

Infrastructure

Developing JED & RUH Airports Station since 2018 till 2022

SAL aims towards building a large investment plan supporting growth in cargo handling. Expansion at key stages is already underway with additional capacity to cater for future growth.

With investment of hundreds of millions of Saudi Riyals on terminal expansion at Riyadh and Jeddah airports and key upgrades planned to build a state-of-the-art facility in Dammam Airport. SAL continues to cement the perception of a true National Logistics Champion.

Infrastructure Plans for Further expansion for JED, RUH and DMM airport Stations 2023-2027

Properties development plans are underway at JED station, RUH station, and DMM station of Saudi Arabia.

JED serves as the primary ground handling station for SAL, with an anticipated increase in transit volume due to the growing Umrah and Hajj air traffic. The development of the station involves constructing a terminal building in stages, as the availability of free or greenfield land is limited, necessitating a phased construction approach.

The primary focus of the next investment step revolves around the second phase of JED station’s development, encompassing the creation of a warehouse exceeding 24,000 sqm within a site area of over 70,000 sqm.

New JED Courier

SAL’s investment also includes the introduction of JED Courier, a dedicated courier service catering to the specific needs of the e-commerce industry. JED Courier focuses on last-mile delivery, ensuring swift and efficient order fulfillment and timely deliveries to customers’ doorsteps. This specialized service further strengthens SAL’s position as a key player in the e-commerce logistics domain, supporting the growth of online businesses and meeting the increasing demands of the digital marketplace.

RUH Station Development, on the other hand, is a Refurbishment Project of an active/operated facility which is 48,000 sqm at site area of 70,000. The Refurbishments scope includes all the building structures, electrical and mechanical systems. The cargo material handling system will be replaced entirely with a new one by the same vender for JED project SDME under the same agreement. The consultant will have functional changes scope at phase (1) warehouse to complete the masterplan vision of RUH station.

DMM is the last part of the SAL ground handling development plans for the Saudi Aviation Cargo Market. The station has limited refurbishment plans to enhance the work environment and to improve the operational functions.

Like RUH Station, DMM refurbishment scope includes all the building structures, electrical and mechanical systems. The main difference here is that it is more limited and moderate refurbishment areas. The station development plan does not employ complex material handling systems. However, the new modern equipment will be from the same vendor of the systems used in JED and RUH stations.

Automation and Digital Transformation

At the core of SAL’s investment strategy is the drive to embrace automation and digital transformation.

By leveraging cutting-edge technologies, SAL is revolutionising the logistics industry, enhancing efficiency, and improving overall operational performance. Automation systems, such as robotics and intelligent sorting solutions, enable SAL to optimize warehouse operations, streamline order fulfillment processes, and reduce error rates. These advancements ensure swift and accurate order processing, leading to enhanced customer satisfaction and improved delivery speeds.

Furthermore, SAL’s commitment to digital transformation is evident in its adoption of state-of-the-art tracking and tracing systems. Real-time visibility and advanced analytics enable customers to monitor their shipments at every stage of the delivery process, providing transparency and peace of mind. By embracing digital technologies, SAL empowers businesses with greater control and insights into their supply chain, enabling them to make data-driven decisions and optimize their operations.

Looking Ahead

As cargo handling and logistics continues to thrive in Saudi Arabia, SAL is well positioned to lead the next phase of growth in the sector. The company’s commitment to excellence, innovative solutions, sustainability, and customer satisfaction sets it apart in the market. SAL’s comprehensive understanding of the logistics industry, its tailored solutions, and its investment in advanced technologies ensure that it is well-equipped to meet the evolving needs of businesses in this rapidly evolving sector. With a focus on sustainable practices, collaboration, and continuous innovation, SAL is positioned to play a vital role in shaping the future of logistics in Saudi Arabia. As the Kingdom’s logistics sector evolves, SAL remains at the forefront, providing reliable, efficient, and cutting-edge solutions that enable businesses to thrive in the dynamic world of logistics. SAL aims to deliver impact by living up to its vision of being the logistics champion for a globally connected Saudi Arabia.

Swisslog showcases cutting-edge automation solutions for e-commerce and retail industries at Seamless Middle East

Swisslog, a global leader in robotic, data-driven, and flexible automated solutions, has announced its participation in the upcoming Seamless Middle East 2023 - the region’s leading exhibition and conference exploring the future of digital commerce.

At Seamless Middle East 2023, Swisslog, which has already made its mark in the region with clients such as Mai Dubai, Robostores, Almarai, and Raha, will be showcasing AutoStore, with a spectacular live demo. AutoStore is a highly efficient robotic storage and order processing solution that integrates easily into existing buildings, designed to help retailers and e-commerce companies meet the growing demand for fast, accurate, and reliable order fulfilment while continuing to compress order cycles and delivery times.

The convenience of online shopping in the MENA region has led to a surge in demand for quick and reliable deliveries, putting pressure on warehouses to streamline their operations. Forward-thinking companies are turning to warehouse automation technology to optimise their processes and improve efficiency to keep up.

Recent reports suggest that by 2025, autonomous robots will process up to 50% of all e-commerce orders, while the average order fulfilment time is projected to decrease from 4 hours to just 30 minutes by 2028. In addition, the UAE is taking major strides towards becoming a global leader in the robotics and automation industry, aiming to increase the sector’s contribution to the gross domestic product (GDP) to 9%. The benefits of automation are clear, and the investment and effort required to implement these systems are worth it for their increased efficiency and customer satisfaction.

Logistics Gulf News sat with David Dronfield, General Manager, Swisslog Middle East, to understand his views and Swisslog’s position in the current market scenario.

LGN: We are stoked to witness the rise of Swisslog in the Middle East. How did you get started here, and how did you position yourself in the post-COVID market scenario?

David: There was a change in people’s habits, especially post-COVID. For example, when it came to the wide shift towards online ordering and the use of technology for the simplest things such as drive-ins, online payments, QR codes instead of brand menus and catalogs, etc. Most companies weren’t prepared for that.

We have crafted solutions for customers who can place orders digitally anytime, anywhere, after which they can choose to pick up their orders from one of our locations or get online delivery across Dubai, which is carried out super quick by delivery boys on motorbikes and with accurate package tracking to ensure the delivery reached the address specified by the customer.

LGN: Tell us about your external market reach. Do you have a strong presence in Saudi Arabia too? They have a vision to position themselves as a global logistics hub by the year 2030.

David: By June or July of 2023, we aim to have a registered business office in Riyadh, Saudi Arabia. We are already in the process of hiring employees there and are processing their trade licenses as we speak. We have been planning this for a while. The core reason why we need to have a stronger presence across KSA is so that we can serve the right people in the region.

When we look at the global supply chain market, Saudi Arabia is incredibly well positioned. KSA has a built-in structure, a promising culture, and professional resources to serve an opportunity and expand our business in the Middle East and North Africa as well.

We have positioned ourselves well in the UAE so far. But, when it comes to KSA, we cannot manage our operations from afar as it is not sustainable in the long run. So yes, we are looking forward to exploring and spreading our business in the Arab countries!

LGN: Are there any new projects or concepts you are working on? Would you like to share some detail on the developments in the company?

David: Swisslog has been evolving since the last 2 years. We are now integrating all four sectors into one bigger structure. We used to function like smaller entity with different sectors. Sales, business development, customer service, and connectivity we can leverage our customer services and solutions carried out in Europe, now into the UAE as well.

LGN: Thank you for spending your valuable time and speaking to us. We congratulate you for associating with us for the “Landmarks in Logistics” summit in Jeddah, Kingdom of Saudi Arabia, in September, and we look forward to meeting and hosting you and your team in the Kingdom.

David: Thank you too. It was a pleasure speaking with you. We are excited and looking forward to being a part of it and the panel. See you in Jeddah!

Max Avtukhov

Co-Founder & CEO

Yango Deli Tech at Seamless 2023