Abstract
M.Comm.
The modern business environment is characterised by a new focus on
strategies towards competitiveness and customer service. This includes efficient and
effective logistical systems to support just-in-time, shorter production run strategies of
customers. Furthermore, the outsourcing of non-core functions to third party service
providers, is an increasing tendency. Transport providers are strategically positioned
within logistical processes to provide value-adding services. Historically, the transport industry
was a highly regulated arena which changed to a competitive deregulated industry.
PROBLEM STATEMENT: With the deregulation of the transport industry, rail transport
lost market share in the total land freight market. Other than deregulation, the following:
In contrast with road, rail is responsible for the accomplishment of transport infrastructure
and the maintenance thereof; the differences in the competitive traits of rail and road; and
the increasing nature of change within the dynamic marketplace itself. After 200 years,
the rail transport mode is confronted with the challenge of relevancy in the twenty first
century.
The main objective of the study is founded on systematic literary research of land transport
within the RSA. The focus is on the role logistics plays in obtaining competitive advantage
from a rail perspective. In order to achieve this, the following were investigated: the
economics of transport; an evaluation of the competitiveness of the RSA road and rail
industry; logistics as an approach to add value and differentiate the transport product; and
suitable strategies specifically for rail in support of value adding and competitiveness.
FINDINGS: The study finds that logistics can create competitive advantage for rail
transport with an unique marketing orientation. This can be maximised by differentiating
the rail transport product alignment with market share in the different segments and
positioning in the product life cycle. The manufacturing higher value segment represents
the biggest growth opportunity in market share. Innovation and quality improvements are
prerequisites within rail, whilst selective divestiture strategies on non-profitable business
must be considered.
The requirement is to provide logistical services within the total supply chain which add
value to customers products. Rail transport must therefore find a balance between cost
leadership and differentiating strategies. Rail transport in the RSA is aware of the
importance to provide logistical value in the freight market.
However, it was found that the transformation to make logistics an integrated part of its
business is lacking. In contrast, road transport rapidly developed the provision of
complete logistical solutions in the freight market. Lastly, it was found that the
outsourcing of logistics is a world trend, especially in respect of the USA and Europe.