Loo Yong Hui describes the first steps in the Swift story as a “fresh start”.
The integrated logistics provider came into existence in 2011, when its shareholder Persada Bina acquired an existing transport company called Yinson Haulage.
As new owners, it quickly set about stripping the business back to basics. “And then we started fresh,” the Group CEO of Swift Group of Companies explains to The CEO Magazine.
With its business in those early days focused on container haulage and inland transportation services, the aging collection of trucks that Swift had inherited in the sale was quickly sold off and a shiny fleet of the latest model Mercedes-Benz prime movers purchased their place. The investment played a key role in turning what was a loss-making enterprise into a profitable one in that very first year.
Back in the black, the company was able to start planning for the future and quickly put into place a strategy for growth through mergers and acquisitions (M&A) and investments in real estate. Each new acquisition has been an entry point into a new industry vertical or new geographical market.
“We started off in the import and export business, as well as container haulage and freight forwarding, which is customs clearance,” Loo says. “Then, slowly, we moved into warehousing.”
Having built itself up into the largest player in that segment, the business moved its attention to local transportation. From there, smaller transportation – one, three and five tonnage trucks, he explains – was the next step.
“We focus on each segment and build it up to a certain size before we move on to the next segment.”
Today, the company profile is a very different one compared to just over a decade ago.
Malaysia’s fastest-growing fully integrated logistics provider, the Group’s fleet of over 1,450 prime movers, 6,000 container trailers, 70 trucks and 42 compressed natural gas tankers operate in both Malaysia and Thailand.
The structured nature of this growth, Loo says, has allowed Swift to differentiate itself in the market.
“We focus on each segment and build it up to a certain size before we move on to the next segment,” he says. “In other words, we build the infrastructure first before we move on.”
With that in mind, he explains that the focus of the last two years has been on warehousing and distribution: currently, it provides approximately 111,000 square meters of collective storage facilities, as well as 28,500 twenty-foot equivalent unit capacity in its container depots.
“We’ve been moving up the supply chain, so to speak, from import and export to warehouse distribution,” he says.
It’s an area of strategic importance that Loo adds he will continue to concentrate on over the next three-to-five years – along with restarting regional expansion plans that were put on hold during the COVID-19 pandemic.
“In 2017, we expanded into Thailand, our first foray overseas,” he says. “Now we are looking at further developing Thailand, as well as possible opportunities in Singapore to really build up the chain through the ASEAN [Association of Southeast Asian Nations] region.”
In August 2022, the company announced details of a proposed acquisition of Singapore-based petroleum transporter, Watt Wah Petroleum Haulage, for US$1.17 million. The deal reached completion in November 2022.
“Singapore is and has been a major trading hub for the region and we see opportunities to expand our services once the acquisition is completed,” Loo said in a statement at the time.
“Watt Wah will be a perfect fit for the group and will bring more than 20 years of excellence and expertise in the haulage of petroleum products.”
M&As will continue to play a key role in the company going forward, with Loo telling Malaysian website The Edge Markets that not only are acquisitions a strategic move to consolidate its market leading position in the domestic market, but that such moves also alleviate recruitment pressures.
When looking at acquiring a company he explained that the “customer base and assets are not very important”.
“We are actually acquiring the drivers because it is hard to get drivers these days. Let’s say if we buy a haulage company with 100 drivers, we immediately get 100 drivers. To employ 100 drivers, it will be a very long process. I can’t find 100 drivers in the market. So, what is important is not the asset or customers, but the manpower,” Loo said in the interview.
Loo, who moved to the United Kingdom to complete a bachelor’s degree in chemical engineering from the University of Manchester, returned back to Malaysia and a role as a fund analyst at ECM Libra Financial Group in 2011.
He joined Swift in 2013, first as a corporate planner. His ascent through the business can, aptly, be described as swift: after a year, he was made Executive Director.
“Over the years I’ve been adding to my responsibilities,” he says. “I started off first with an M&A deal, overseeing the purchase of a freight forwarding company called DKSH Transport Agencies for RM60 million [US$13.6 million].
“From there I moved into a more operational role as Executive Director in charge of the container haulage operations in the Central Region.”
In 2019 he became Group Executive Director, transitioning into the role of Group CEO on 1 May, 2021. He is also the Director of the Group’s subsidiary companies, associated companies and joint venture companies.
One of his first major tasks was Swift’s initial public offering (IPO) on the Malaysian stock exchange, the Bursa Malaysia.
The debut, which took place in December 2021, was one of the strongest of that year, raising approximately US$36.8 million in figures quoted by the company.
“Our enhanced capital base and expansion plans will serve to strengthen our capabilities and competitiveness in the industry. This will enable us to better capture growth opportunities as the global economic recovery resumes and deliver a sustainable growth strategy to meet shareholders’ expectations in value creation,” Loo said of the IPO in a statement at the time.
New to the Group CEO role, but not to the company, he’s quick to identify the challenges currently facing his growth plans. “Similar to all industries, the key challenge we’re facing is the labor shortage issue, or the competition for skilled labor,” he says.
“Seventy-seven percent of our business is transportation and trucking, so we rely heavily on having sufficient drivers, good and responsible drivers, skilled drivers,” he says.
With this at the front of his mind, he says that much of his focus is currently on talent management – particularly given the role companies like Swift play in ensuring the continuous flow of the global supply chain.
“Seventy-seven percent of our business is transportation and trucking, so we rely heavily on having sufficient drivers.”
“In Malaysia, perhaps even the ASEAN region as a whole, there is a bit of a knowledge gap in terms of the supply chain,” he says. “On top of that, given the last two years-plus of the pandemic, there’s also a lot more limelight being shone on the supply chain.
“Everyone is more acutely aware of how the supply chain can really disrupt all sorts of business.”
But it’s something that also can’t change overnight, he cautions. “It takes time to build the talent and the knowledge,” he says.
Primarily focused on business to business (B2B), Loo also explains how Swift has started to undergo another important strategy shift. “We are slowly building the infrastructure to enter the B2C [business to consumer] market,” he says, adding that it’s a “like it or not” scenario.
“That’s where the trajectory is. Where the trends are going. We can’t avoid it. That’s where consumer buying behavior is going.”
For the moment, he says the company is still almost a “100 percent B2B business”. But with an eye to the future, he’s slowly making investments in last-mile infrastructure, just like the company has done for every new vertical foray in the past.
“We won’t plunge into the last mile by itself,” he says. “We need to have the infrastructure in place before we can.”
An entry into the last-mile market, the final leg of transportation, is set to make Swift an even bigger force in the Malaysian integrated logistics market.
For Loo, Swift’s fleet is a unique selling point in a crowded logistics market. “We are focused on having the youngest fleet in the industry,” he says.
In an interview with the Malaysian edition of The Edge Markets in December 2021, Loo further elaborated, explaining how its policy of only investing in new trucks has been the company’s recipe for success and a significant driver behind the 30 percent gross profit margins it has enjoyed over the financial years from 2018 to 2021.
“We are focused on having the youngest fleet in the industry.”
“Basically, to run a haulage business, cost and productivity are important. Everyone pays the same for diesel, the same commission to the drivers and toll. What we can control is the type of truck used, so that is why we bought new trucks and only continental trucks,” Loo said in the interview.
“With the new trucks, we know our fuel efficiency. We know our new Mercedes trucks will give us 2.3–2.5 kilometers per liter of diesel, and service interval on average is every 55,000 kilometers, so that is between five and six months. Whereas secondhand trucks, every month also you need to service. So, it is high productivity and a lower cost base because of using newer trucks.”
A snapshot of Swift’s core business activities:
Describing its trucks as the company’s “key asset”, Loo also emphasizes the integral role that partnerships with vehicle manufacturers, particularly with Hap Seng and Volvo, plays in its overall success. “We only trust continental brands because they have been in the market so long,” he says.
The relationship with Hap Seng, Mercedes-Benz’s commercial vehicle arm in Malaysia, is particularly strong – so much so that Swift became a dealer in 2013.
“Under a subsidiary called Q Team we are a ‘3 S’ sales, service and spare parts dealer and offer sales service for Mercedes-Benz commercial vehicles,” he explains.
Volvo Trucks Malaysia is another long-lasting partner and, in August 2022, Swift announced it has signed a Memorandum of Understanding for an order of electric trucks from the manufacturer, making the company the first in its field to do so.
For Loo, the investment is a significant step in the company’s sustainability ambitions.
“We are extremely proud to also be the first to integrate EV trucks into our fleet.”
“Over the longer term, we hope to convert our whole fleet to electric trucks. We are therefore glad to have Volvo Trucks with us on our journey in making the switch.” Loo said at the time of the announcement.
“We are extremely proud to also be the first to integrate EV [electric vehicle] trucks into our fleet. We are looking forward to what electromobility will do to transform our industry in the future,” he continued.
Swift, he adds, has and always will be at the forefront of technological adoption. “This latest move to adopt EV trucks is a testament to that.”