Photo credit: Quick Meme

Early this week, the logistics industry was abuzz with news that one of the global supply chain giants, Panalpina, had officially set up shop in Nairobi. Formed in 1935, Panalpina is an international logistics powerhouse.

Channeling years of history and experience in the industry, Panalpina has been able to grow a business spanning 70 countries, with operations in an additional 90 countries in conjunction with local partners. Essentially, Panalpina is what we all want to be when we grow up.

Like a number of other international companies currently establishing offices in Nairobi, Panalpina’s presence can be attributed to the potential gains to be had from participating in our flegdling oil and gas industry. So what does this mean for supply chain management in Kenya?

First, this and other companies’ decision to participate in business in Kenya clearly points out the potential of the Kenyan economy.

A good indicator of a country’s financial future is always the presence of foreign investors. While tourists may be slow in returning to grace our shores, the pursuit of money does not scare as easily.

Kenyans in general stand to benefit both directly and indirectly from the injection of business, capital and job creation that comes along with the presence of investors.

Such developments also work to reassure other potential investors that the country is safe and a good choice for a business hub, as they can see their fellow foreign corporate bodies prosper.

Speaking of business hubs, Kenya’s strategic geographical location and years of relative peace and economic stability have helped position her as a key business hub for the East African region.

With the current focus on developing Kenya’s infrastructure in roads and railways, we are well placed to grow our advantageous position.

By building on the base previously established by the upper hand provided by years as a trading and transportation hub, and the upper hand of having the Port of Mombasa, Kenya can cement her place as the central logistics “headquarters” of the region.

This naturally translates to a much more fertile environment for local logistics-based businesses to grow and thrive, to our benefit as entrepreneurs and employees alike.

Photo credit: J. Nathan Matias / Flickr

On the flip side, this also means there will be an increase in competition in the Kenyan logistics industry.

With supply chain management being recognized as a lucrative business option, new market entrants will make those already involved in the sector have to work even harder for our market share.

While this can be viewed as negative, we choose to see the bright side. Increased competition means we will all have to be on our A-game to survive, meaning the Kenyan logistics industry will have better standards and overall performance, especially with the entry of international companies to benchmark our operations against.

With the developments we are likely to see as a result of this and other developments in Kenya that will have an impact on the logistics scene, opinions are varied.

Doubtless, some of us are afraid of possible upheavals that may upset our comfortable status quo, while others of us are excited to have the chance to prove our mettle, and of course, weed out the weaker participants that paint the industry in a mediocre light. Where do you stand?