Container News talked with Luc DeClerck, CEO of Avantida. Luc DeClerck, in conversation with Antonis Karamalegkos, spoke about the creation of Avantida, the recent decision to step into United States and Canada and the company’s future plans.
CN: How was the idea of Avantida created? What motivated you to come up with that project?
Luc DeClerck: Very simply. We started talking to some of the players in the logistics area and quickly found out that empty containers were a big cost for everybody and a big problem for everybody. So, we decided based on our findings to create a very simple application for transport companies to try triangle turn, street turn their boxes in Belgium for one ocean line, MSC. MSC was the first ocean line to use it in Belgium. And from that, in the past 3,5 years we’ve expanded. The start was something very small and at that time it is an application, which can show the effect of what we can do with the empty equipment handling. We decided to 100% focus on empty containers, as a company.
CN: How much time did you need to “go live”?
Luc DeClerck: We went live with the application in the summer 2015, 3,5 years ago. We needed about 6 months before in order to build the platform.
CN: Which were the main difficulties you had to overcome in order to “go live”?
Luc DeClerck: Of course, what we need is the ocean lines to participate in the platform, because of course they own the container boxes, so they are very important in our model. So, the owner of the equipment is the first key and then, of course, on the other hand we need to convince the transport companies to see the benefits of the platform and to start using this. So, we are in the middle in between transport companies and the ocean lines and we are very comfortable with that. But it’s two areas we had to work on in order to go live.
“In the coming weeks and months we will announce additional ocean lines that will start using our platform in U.S. and Canada.”
CN: Did the industry accept the idea of Avantida in a good way?
Luc DeClerck: Yes. If you look at each time that we go live in a country, we always start with one sometimes two ocean lines and then more ocean lines join and then more ocean lines join, you see more transport companies joining. You see that everybody, if you speak to our users, quickly see the benefits of the platform. So, in that respect, we never had big issues in reaching a nice level of transaction in a particular country in North Europe, South Europe, or now in North America. The problem of the empty equipment is the same in every country. There is no much difference. Each country is different logistically but the problem, the quarter problem, is almost in every country.
CN: Tell me about your decision to step into United States and Canada
Luc DeClerck: Once we were doing some nice things in ten countries in Europe, of course the ocean lines are guided in ten countries in Europe. They can do it, also, in North America, which was forced to decision to say “Ok, let’s start focusing on going live in North America”. That of course required a bit of time. So, we worked on it for a year to go live there, because of all the local situation. We wanted to really understand the local situation, before we go live. So, Maersk Line is now the first ocean line, that went live in US and Canada, but in the coming weeks and months we will announce additional ocean lines that will start using our platform in industrial market.
CN: What do you expect from that move? Which are the benefits and the results you are waiting to see?
Luc DeClerck: We did an analysis, of course, before going to US and Canada and we had some discussions with the ocean lines and the potential. And we believe that the potential in the North America is the same with that in the 10 European countries working. So, we hope in the next 24 months to grow. It will take 24 months. It takes time because we go ocean line by ocean line, joining region by region. It needs time. We give ourselves 24 months in order to reach the same kind of level as we do in the European countries.
“So, now we are starting to prepare our launch in Asia, but next one will probably be Brazil.”
CN: Do you believe there will be new challenges in these new markets?
Luc DeClerck: The challenges of course are a bit different. Because if you go live in a country like Poland, which is also a large country, compared to US, it is still a different size.
US is a huge market. The specifics in US market is the situation with the tracking companies and pool operators, which is different than Europe, but I don’t know that, and also some changes in payment method, but I don’t know that. The underlying rationality is the same. So, it’s just a mater of making shorter that we communicate, stay very close to our users and walk with them. The initial feedback is the same problem, so the solution we work in US is possible.
CN: Have you found any similar platforms existing in U.S., Canada or elsewhere, that could be a competitor to Avantida?
Luc DeClerck: The issue there is that everybody labels its street turn and of course street turn is an important element but we see a number of players in US market who try to find matches between different transport companies. Transport Company A has an empty box and transport company B wants to use it that I can then see what they can swap the box. That’s not what we do. We don’t do that. But if two transport companies find a match, one of them can request the approval from the ocean lines to fire our platform. So, it’s a really big gate way to the ocean lines. All the others players are often trying to match optimize between transport companies.
CN: Are there specific issues, which Avantida aims to solve in U.S. and Canada?
Luc DeClerck: No. The things that we see both in USA and in Europe. There is a shortage of truck drivers. There are limitations because of electronic login devices. There is congestion around ports and in terminals. So, the situation is very similar in both continents. By using a platform, this transport can be really optimized. Planning and matching two truck drivers, they do not sit down to wait for hours and that is one of the advantages – avoid time, avoid waste of time, avoid empty runs – and I’m sure that if there is shortage of truck drivers and there is congestion, the platform is ideal to optimize the planning of the transport company
CN: And what about your future plans for your company?
Luc DeClerck: The next plans, very clearly, we are targeting other countries, specifically Brazil. It’s an interesting country and an important market. We have done the market research. We have been there. We have talked with the ocean lines, preparing for a launch later this year. And we started exploring the possibilities in Asia. We’ll be in Japan next week to discuss with ocean lines the possibilities in Japan, which also seems to be a very interesting market. So, now we are starting to prepare our launch in Asia, but next one will probably be Brazil.
CN: Have you set a specific timeline, during which you want to succeed that?
Luc DeClerck: No. We do it country by country, we work closely with the ocean lines and transport community and then we define what the right sequence is. So, USA now was definitely from all sides the next big opportunity and so by just doing this in that fox that frozes the easiest way to determine our priorities. Because as we said, we can do it in every country, but we have also limited means to become to 10 countries at the same time. We do it country after country and that’s been our approach so far. In couple of the years, we will be everywhere in the top30 countries, where it comes to container traffic, because the top 30, top 40 maximum is where we focus on, because it needs to be significant import and export volume for the platform to function. Smaller countries will be always out of scope.
CN: What is your vision for Avantida in ten (10) years time?
Luc DeClerck: Ten years is a very long time. We started with street turns, but I believe the company could evolve into really something that could help all parties with all their empty equipment moves, because a street turn is only one aspect. You can also do a lot of things. For example, why you drop your empty box, why you pick up your empty box. Today, there is often little flexibility on the side of the ocean lines. I believe that via our platform we can increase the flexibility and still make sure that both sides win. Make sure that transport companies win and make sure that ocean lines win. I think being really the empty equipment platform where all the selections can happen is for me, I think, a logical evolution of Avantida.