When Swiss global agribusiness Syngenta sought to consolidate its fragmented fleet management service in the Asia Pacific region its search was immediately hampered by the lack of a suitable local supplier.
It ended up proposing to an existing supplier in the UK that it expand its business to the region, with such successful results that by the end of the first 18 months of the contract Syngenta estimated it had saved more than $2.2m, against service fees of $800,000.
The project also propelled Sygenta to victory in the CIPS Asia Supply Management Awards, where it picked up Best Supplier Relationship Management.
Before 2015, the local sourcing team at Syngenta managed the company’s 1,700 cars in APAC, but there was a wide variation in local fleet policies.
Overall across the region there were 12 different car policies with 15 different car brands and more than 70 different models.
Employees within the same grade received cars ranging from a modest Daihatsu to a luxury Toyota Hilux, a situation that was driving up costs and causing inefficiency.
And without a professional fleet manager the company was exposed to unmanaged risk areas such as HSE standards compliance, end of contract costs and unforeseen price increases.
Syngenta began to search for an independent fleet management company in APAC similar to Fleet Logistics, Europe’s largest independent fleet management provider, with whom Syngenta had a successful working relationship in the UK.
However, in APAC, independent fleet management providers did not exist in 2015, as the region’s larger suppliers seemed to concentrate on the more profitable car leasing business.
Fleet management services were mostly administrative, whereas Syngenta needed strategic and objective sourcing of car leasing companies, manufacturers and distributors, as well as implementation of fuel management strategies, such as fuel cards and telematics.
Syngenta decided that instead of waiting for a local supplier to develop organically it would ask Fleet Logistics to expand into APAC, with Syngenta as its first customer.
Fleet Logistics is part of the larger TUV SUD group, which already has a presence across much of the region, so was able to expand at a relatively low cost, with Singapore as its hub.
When Fleet Logistics conducted a preliminary study across the region it found it could generate more savings for Syngenta than the fees it would charge and decided to go ahead.
The partnership was so successful that in 2016 Syngenta decided to sign a global contract with Fleet Logistics to expand into North America and Latin America using the same approach.
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