Quick Cargo Service: Still going strong 40 years on

IS THIS A GOOD TIME to be setting up as an independent forwarder? Stephan Haltmayer, managing director of Germany’s Quick Cargo Service (QCS) wonders, writes Peter Conway.

“There are now so many regulations that I am not sure I would recommend anyone to start a forwarding business these days,” he says. “You have to be ISO, AEO, a Secure Agent, IATA-registered and so forth, and the margins are not so good that you can become a millionaire. Maybe that is why there are not so many new companies coming into this industry anymore.”

Entrepreneurs will always overcome such challenges, however, and that was certainly true of Dieter Haltmayer, Stephan’s father, who founded QCS 40 years ago in conditions that were even less favourable. At the time he was cargo sales and service manager for Air Canada in Germany, and the carrier wanted him to move to London to become cargo manager there.

Despite having nothing against London or the UK – he even had an English wife – Haltmayer wanted to remain in his native Germany and so decided instead to set up on his own as a forwarder. Lots of his contacts promised to support him with business, so everything looked promising.

Then came the Yom Kippur War in October 1973 between Israel and Egypt, and following that a crippling oil embargo by the OPEC states that saw oil prices quadruple and Western economies crumble. Into this environment QCS was born in 1974. The promised support failed to materialise.

Unable to get German export business, Haltmayer had to be creative. “He went after every bit of business he could get,” his son relates. “He did customs clearance for carpets and for batik fashion imports. He even provided a service for passengers who arrived at the airport with items that needed customs clearance.”

Other lines included importing live tropical fish and organising freighter charter flights to Mecca for a company selling suitcases to Hajj pilgrims. “It was that business which made him enough money to start having employees,” Stephan Haltmayer remembers. The first to join was Wolfgang Patzke, who became Haltmayer senior’s right-hand man, organising the forwarding operations while Haltmayer went out and got the sales.

To do this he travelled extensively. “My father was one of the first to realise that you get business by talking to consignees overseas,” says Stephan Haltmayer. “He did a lot of travel in Asia and got orders from there. We also got a reputation as a reliable partner who did what we promised and paid on time. A good reputation is more important than anything else in this business.”

This largely remained the model for the company until 2000, when the business started to change. With the arrival of the euro, QCS started gaining more Asian and US shipments for Germany consignees, and its export business also grew considerably to account for as much as half of turnover. 

For the first time in its history the company also started to expand out of Germany, opening an office in Amsterdam in 2004; Basel in 2008; Zurich, Copenhagen and Warsaw in 2010; and London in 2013. Whereas once the aim was to be a strong player in Germany, now the home market is the whole of Europe.

Stephan Haltmayer says more offices are on the cards – Vienna being the next probable target. 

“We see a lot of opportunities to grow in Eastern Europe and we already employ someone in Hamburg, our seafreight hub, to look at opportunities there. In conjunction with our office in Poland we are certainly aiming to gain market share there.”

Growth at QCS has always been organic, never by acquisition, one small exception being its new London office, where it acquired an existing company. “Half of all acquisitions fail,” Haltmayer says, “because you can’t buy people and this is a people business. So when we want to expand we always put our own person into that market.”

Nor has the Haltmayer family, which still owns QCS out-right, ever been tempted by the many offers from larger entities to buy their business. Stephan Haltmayer quips that in any case it is not his decision (his father remains the majority shareholder), but more seriously points out that the third generation of the family are now involved in the business.

In this QCS is perhaps typical of many of its customers – the famous Mittelstand, or family-owned manufacturers of Germany. Understanding the philosophy and approach of such customers is one of the unique advantages that QCS can offer. 

“The multinational for-warders are not good at serving mid-sized companies. 

They may have better rates, but we are closer to the customers – they can talk to us in person rather than to a voicemail,” Haltmayer says. “For this reason I see good growth opportunities for QCS for at least the next five years. Ten years into the future, who can say?”.

A forwarder like QCS can also score in the kind of specialist segments that need hands-on service. Haltmayer highlights such areas as pharmaceuticals, clinical trials, airline parts and ships spares, all of which have a need for a reliable time-definite service. QCS is ideal for such clients because it controls its own operations throughout. 

It brings all cargo into its own warehouse at Frankfurt where it is fully prepared for flight, and then delivers it to airlines on its own trucks. “A lot of forwarders subcontract these services, but we do them all ourselves,” says Haltmayer. “So the cargo is in our hands from the time we pick it up to the time we deliver it to the airlines.”

Such good old fashioned services as on-board couriers are also used for urgent shipments – Haltmayer says a week rarely goes by in which there are not one of these – and QCS also offers expedited, express or next flight services. This kind of business accounts for 10-12 per cent of its business and rising.

Haltmayer is in no doubt that specialist services of this kind are a key part of the future of air cargo, but he is also optimistic about general cargo, which still makes up the bulk of QCS’s business. As a forwarder dealing with both air and sea freight he sees no sign of any drift from the former to the latter. Rather, with slow steaming in the shipping industry to save fuel, he sees the gap between the two modes getting bigger. “They are still two very different products,” he says.

Perhaps the only factor inhibiting airfreight is the increasing amounts of regulation, particularly on the security front. These are a fact of life, but Haltmayer says they slow down air freight shipments. 

“Before 9/11 airfreight was getting cheaper and cheaper, but security issues have stopped that trend,” he says. “A shipment still takes 6-7 days on average and security is worsening that situation. We do our best, having our own x-ray machines so that we don’t have to wait three or four hours for airlines to do the screening, but it still adds complexity to the business.”

Still he remains optimistic in the face of such challenges just as his father did, and with a third generation coming up there are hopefully many more decades of the QCS story. Haltmayer is inspired by firms such as Hellmann and Dachser, both still family-owned. “They show me that there is still a lot more that a family firm can do,” he says.