The Journal The Authority on Global Business in Japan


June 2014
One Company; Three Ways of Doing Business
Custom Media

It may have taken five years to satisfy the exacting demands of the Japanese Customs Authority, but Schenker-Seino Co., Ltd., has at last been granted Authorized Economic Operator (AEO) status. And that’s going to have positive repercussions for the company, its partners and—most important—its clients.

The company, which is headquartered in the German city of Essen, is the first foreign logistics provider with heavy cargo forwarding services to receive a certification that is regarded as a benchmark in the industry.

“It is an international customs initiative on procedures, compliance, and security that is designed to put as many companies as possible in the supply chain on the same level,” said Herbert Wilhelm, president and CEO of the company.

“And if all those firms are working to the same standard, then that will make the entire process smoother and safer,” added 56-year-old Wilhelm, who is originally from Frankfurt, but who has lived in Japan for 17 years.

As well as reducing paperwork, the certification means that cargo carried by Schenker-Seino is subject to significantly fewer inspections, thus expediting the clearance process and saving time for the consumer.

“We believe this is making us more attractive because it shows we have a high standard of operations and if those involved in the process—shipper, forwarding company, customs broker, consignee—have the same certification, then it will make the process significantly quicker,” he said.

Experts in moving items—from the small and precious to the large and bulky—by land, sea, and air, the company employs 480 people in Japan, operates from 19 locations between Sapporo and Okinawa, and has its main hubs in Tokyo, Yokohama, and Osaka.

Meanwhile, the Japanese market remains particularly demanding, with customers here expecting a degree of service above and beyond what would be expected elsewhere.

“Product levels are high, service levels are equally high, and in many cases we are asked to complete claim documents when a box is not in perfect shape, for example, but would be totally acceptable elsewhere,” Wilhelm said.

But that is not a bad thing, he insisted, as it encourages the company to be the best it can be.

“I tell my colleagues in other parts of the world that, if they are able to completely satisfy a Japanese customer, then they have it made,” he said.

The AEO recognition coincides with two important milestones in the company’s Japan operations: 2014 marks the 50th anniversary of Schenker’s business here, and the 12th anniversary of its joint venture with domestic logistics giant Seino Transportation, from where is derived the double-barreled name used in Japan.

Schenker initially went into alliance with Nippon Express and opened its first Japan office in 1964.

A second arrangement, with the forerunner of MOL Logistics, operated between 1979 and 2002, when Schenker signed the joint venture agreement with Seino.
The arrangement benefits both sides, Wilhelm pointed out, as it gives Schenker an ally with a vast domestic distribution network, while Seino is able to leverage Schenker’s international reach and experience.

In 2007, a third international element was added to the mix when Deutsche Bahn, Schenker’s parent company, acquired the US transportation firm BAX Global. In Japan, the result of the merger was a near doubling of the scale of operations.

And Wilhelm is keen to emphasize that he is teasing the best elements out of three quite different ways of doing business.

“International transportation is what we do, but we have three parts that fit neatly together,” he said.

“We have a European influence, we have a Japanese mentality toward service, and we have American spirit.”

As well as doing business across borders and having a multi-national mindset, Schenker-Seino also benefits from a group of employees drawn from across the world.

“We are quite our own little United Nations,” Wilhelm said. “We have people of 16 nationalities in the company, and that makes a big difference in our working environment. I believe it makes it an attractive place to work for people who are international in their outlook and that can only help our business.”