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Ocean shipping shrinks as pandemic pummels retailers

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LONDON/LOS ANGELES/MADRID (Reuters) – The $1 trillion container shipping industry is in a slowdown. Literally.

Some shipping lines, whose retail customers are being hammered by the coronavirus pandemic, are reducing sailing speeds and taking longer routes around Africa, avoiding Suez canal passage fees, according to the companies and ship-tracking specialists.

Many are also cutting down the number of voyages and providing short-term storage for clients as the industry, which includes heavyweights like Maersk (MAERSKb.CO), MSC and Hapag-Lloyd (HLAG.DE), faces its biggest downturn since the 2008 financial crisis.

The new tactics not only save on costs, but also help adapt to the needs of cash-crunched retailers – among their biggest customers – who are stuck with huge inventory surpluses thanks to COVID-19 store closures and a collapse in consumer demand.

Slower shipping times also means importers can delay payments made on delivery.

From sportswear maker Puma (PUMG.DE) to mall stalwart Gap (GPS.N), many retailers have been forced to reduce or slow down shipments of new merchandise. Civil unrest in the United States has compounded their problems by further clouding the prospect for a recovery in the world’s biggest retail sales market.

Puma’s Chief Executive Bjorn Gulden, for example, said it was managing some of its excess inventory by stowing it on slow-going ships as stores in the United States and Europe tentatively reopen.

However, at the same time, the shipping slowdown has created headaches for those retailers, from Walmart (WMT.N) and Amazon (AMZN.O) to shoe seller Rothy’s, who have never stopped selling products to homebound consumers, ranging from books and shoes to exercise equipment, much of it sold online.

Now those retailers are fighting for space on the fewer, faster-moving ships on the high seas.

“What we are seeing is quite a mixed situation from cargo owners, some of which are resuming normal shipment of their cargoes, others are requesting routings via longer transit times,” said Marcus Leaver, chief operating officer of sea freight at Hellmann Worldwide Logistics, which organises shipments for companies such as retailers.

A lack of space on ships is leading to more “rollovers”, where containers are bumped from packed vessels to later ones, like passengers on oversold flights, according to importers.

Spanish retailer Mango, which has continued to sell online during the pandemic, told Reuters it was seeing an increase in service cancellations by shipping companies, which caused instability and “space problems”.

It added that 99% of its imports from Asia were now coming by sea because air costs had gone up due to a lack of flights and the priority given to medical equipment.

‘A lot of trouble’

The stakes are high for the container industry. Retail goods such as clothes, luggage and furniture represent about 15% of shipped volumes, a Reuters analysis of industry data shows.

Soren Skou, CEO of Maersk, the world’s biggest container shipping group, said many of its big customers were retailers or suppliers to retailers.

“There are some traditional retailers in a lot of trouble and, as you know, some have started to go bankrupt,” Skou said last month. “Some customers ask us to delay shipments and we have found extra storage and warehouse facilities for them.”

Shereen Zarkani, Maersk’s global head of sales, told Reuters: “One customer told us: If you make my container go around the world a couple of times that would be good.”

The volume of apparel arriving in the United States by ship dropped nearly 20% in January-May versus the same period last year, and reached 379,910 TEUs (20-foot equivalent container units), data from logistics technology company Descartes showed.

Furniture volumes fell over 12% in the same period, while luggage dropped over 34%.

The first blow landed when the novel coronavirus forced China to shutter factories in February, cutting off supplies of apparel, electronics and other retail goods to the world. The second came when stores in Europe and the United States closed, leading companies like Topshop owner Arcadia Group, Gap and off-price retailers Marshalls and TJ Maxx (TJX.N) to cancel orders.

“When you look at the East-West trades we are right now looking at 15% to 20% (taken out) across the industry,” Rolf Habben Jansen, CEO of German-based Hapag-Lloyd, said last month pointing to the fall in capacity in recent weeks.

Outlook: Stormy

There does not appear to be any let-up in sight for container shipping companies as their retail clients could still be feeling acute financial pain in July, when they begin placing orders for holiday and winter merchandise.

Jay Foreman, CEO of Florida-based toy supplier Basic Fun, which sells to retailers including Walmart and Target Corp (TGT.N), said he expected a 20% decrease in business this year.

Indeed, the outlook for retail is dim: Euromonitor forecasts that U.S. retail sales will fall more than 6% this year.

James Conroy, CEO of California-based clothing company Boot Barn Holdings (BOOT.N), told analysts it faced “several headwinds”.

“High unemployment, extremely depressed oil prices and a shift toward online shopping will present challenges for us as we progress through the next six to 12 months,” he said.

Reporting and photo: Reuters

Business

Atmosphere Core appoints Maurice Van Den Bosch as GM of RAAYA by Atmosphere, Milan Mookerjee as VP of Human Resources

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International hospitality company Atmosphere Core has announced the appointment of Milan Mookerjee as Vice President of Human Resources.

This appointment reflects Atmosphere Core’s ongoing commitment to enhancing guest experiences and fostering a people-centric culture across its portfolio of three brands and nine resorts.

Veteran Human Resources leader, Milan Mookerjee will oversee talent management and employee growth initiatives across the Atmosphere Core’s resorts in the Maldives. With over 15 years of industry experience, Milan is a seasoned professional known for aligning HR initiatives with business goals and fostering a human-centric culture.

Reflecting on his approach to human resources, Milan said, “Leadership is a privilege that we owe to our team. Intentionality with direction and purpose drives results, and I am committed to fostering a culture that empowers our people to grow and succeed. In hospitality, success begins with a motivated, engaged workforce, and I believe in creating an environment where employees feel valued, supported, and inspired to deliver exceptional guest experiences. This includes investing in continuous learning, nurturing talent, and promoting a strong sense of belonging within the team.”

Before joining Atmosphere Core, Milan served as Head of Human Resources and Training at Encalm Hospitality Pvt. Ltd., where he led HR and training functions to drive business growth. He has also held several HR leadership roles at prominent companies in India, with a proven ability to develop talent and design learning programmes tailored to business needs.

Meanwhile, Maurice Lucien Van Den Bosch recently returned to the Atmosphere Core family as General Manager of RAAYA by Atmosphere.

Born in Australia, Maurice Lucien Van Den Bosch draws from the country’s renowned laid-back yet dynamic culture in his leadership style, fostering a spirit of inclusivity, adventure, and warm hospitality. He brings over 24 years of expertise in resort management, with a demonstrated ability to exceed profit targets, cost-effectively develop new projects, and lead culturally diverse teams with motivation and efficiency.

Maurice’s extensive experience includes leadership roles at some of the world’s top hospitality brands in the Maldives, Sri Lanka and the Caribbean. A familiar face within the Atmosphere Core family, Maurice has served as General Manager at both OZEN LIFE MAADHOO and Atmosphere Kanifushi.

As the General Manager of RAAYA by Atmosphere, Maurice will leverage his deep understanding of the brand to lead the resort with a focus on anticipating, crafting, and elevating guest experiences. “The culture and hospitality inspired by the Joy of Giving resonate deeply with me, and this shared value brings me back to the Atmosphere family”, Maurice said. “At RAAYA by Atmosphere, we are creating a castaway island experience of choice, a guest experience like no other, with a fine balance of escapism and energy. And I look forward to foster a collaborative working environment so that we create unforgettable moments for our guests.”

Ashwin Handa, Senior Vice President of Operations at Atmosphere Core, emphasised the importance of a strong leadership team. “At Atmosphere Core, we foster a people-first culture built on trust, collaboration, and mutual respect, ensuring that every employee takes pride in their work. This dedication extends to curating experiences that guests cherish and return for. Maurice’s deep industry expertise and understanding of our brand, combined with Milan’s people-centric approach, will significantly enhance our operations and guest satisfaction across our resorts”.

Atmosphere Core is a dynamic international hospitality company with three distinctive lifestyle brands, THE OZEN COLLECTION, COLOURS OF OBLU, and Atmosphere Hotels & Resorts. The company operates nine resorts in the Maldives and has a strong pipeline of one resort in the Maldives, one resort in Sri Lanka, and fourteen hotels and resorts across India – all set to open within the next three years. Distinctive design, an authentic sense of place, inspiring service styles, and the freshest and finest cuisine lend a unique flavour to every Atmosphere Core property.

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Business

Maldives makes export of baled PET waste for recycling with support from The Coca-Cola Foundation

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The Coca-Cola Foundation and partners have announced that a container of baled post-consumer Polyethylene Terephthalate (PET) plastic was exported from Male as a part of Sustainable Island Waste Management and Plastic Recycling Initiative.

Completed on World Cleanup Day 2024, the event also marked the handover of The Coca-Cola Foundation (TCCF)-funded infrastructure, which includes pickups and balers, to the government-owned Waste Management Corporation (WAMCO).

The TCCF-funded initiative is a collaboration between the Maldives Ocean Plastics Alliance (MOPA), and WAMCO, and represents an important development to strengthen the PET collection process and address the issue of plastic waste in the Maldives.

This initiative will export baled PET to Malaysia and China for recycling. While PET bottles have been exported in the past, baling the waste significantly improves the efficiency of storage and transport, marking an advancement in the process.

The overall objective of the TCCF-funded Island PET Collection Project is to help provide a countrywide solution for plastic waste recycling in Maldives by establishing both the infrastructure and systems required.

Currently, much of the waste in Maldives is disposed of or incinerated in K. Thilafushi industrial island, and this project represents a shift toward better waste management practices.

The project focuses on expanding PET collection systems beyond Greater Male’, improving collection efficiency across the nation until local recycling capacity is developed.

“This project is a turning point for the Maldives in our fight against plastic waste,” said MOPA President Ahmed Maumoon. “By educating communities and aligning with national partners like WAMCO, we are not only improving how waste is managed today but also setting the stage for long-term sustainability and environmental health.”

By collaborating with WAMCO, MOPA has supported the roll-out of community education programs and has worked to ensure the infrastructure deployed with funding from TCCF, such as compactors and pickups are used effectively across Greater Male’ and across other islands.

“This initiative represents a crucial step toward improving plastic waste management and enhancing recycling efforts in the Maldives,” said WAMCO Managing Director Mujthaba Jaleel. “By equipping islands with the tools and infrastructure needed to collect and process PET waste, we are not only helping address the immediate challenge of plastic pollution but also building a foundation for a more sustainable future.”

WAMCO’s role is pivotal in overseeing the operational aspects of PET waste collection, ensuring that baling and export processes run efficiently.

“Our commitment to this project extends beyond waste collection,” said Carlos Pagoaga, President, The Coca-Cola Foundation. “By funding work of MOPA and WAMCO, we aim to foster a culture of sustainability in the Maldives and help support a circular economy.”

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Events

Italian and Spanish media experience Maldivian paradise on exclusive journey with Atmosphere Core

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From September 28th to October 4th, 2024, Atmosphere Core hosted an exclusive media trip to the Maldives for ten prominent journalists and PR professionals from Spain and Italy. The group experienced the serene and captivating lifestyle of two stunning private islands—OBLU XPERIENCE Ailafushi and RAAYA by Atmosphere—both renowned for their distinctive hospitality, thoughtfully curated holiday plans, and the unique “Joy of Giving” philosophy.

“At Atmosphere Core, we believe in a more creative approach to media trips,” said Euan Blake, Assistant Vice President of Communications. “The Italian and Spanish markets have been expanding for the Maldives, with a notable increase in room nights and revenue compared to last year. Over the past two years, we’ve been building strong relationships in these regions, and this journey through our islands aims to leave journalists with not only cherished memories but also lifelong friendships.”

The trip began at OBLU XPERIENCE Ailafushi, a lively four-star resort just 15 minutes by speedboat from Velana International Airport. Journalists were welcomed with breathtaking lagoon views and vibrant social gatherings at the X360 Bar. A standout experience was the customised Martín Códax Wine Masterclass at the Element X restaurant, led by Ms. Celina, a representative of Bodegas Martín Códax, and Nicolas Laguette, Director of Wines at Atmosphere Core. Representing 600 winemaking families from northern Spain, Ms. Celina guided the group through an exquisite multi-course wine tasting, featuring a selection of wines perfectly suited for the tropical climate and fresh seafood.

This was followed by an unforgettable underwater dining experience at the Only BLU restaurant and a visit to the neighbouring “island of love,” OBLU SELECT Lobigili, where they enjoyed a chic lunch at Ylang Ylang. The island’s lively, party atmosphere provided the journalists with a full immersion into the vibrant and relaxing resort lifestyle.

Next, a scenic seaplane journey transported the group to RAAYA by Atmosphere—a picturesque escape offering a blend of fairytale island charm and authentic Maldivian experiences. The 45-minute flight over the stunning atolls’ turquoise waters set the stage for their arrival in paradise, presenting the perfect introduction to the Maldives’ breathtaking beauty.

At RAAYA, the journalists experienced an ideal mix of energy and tranquility. A private dinner atop a secluded watchtower, inspired by the legendary sailor Seb, captured the essence of the resort’s castaway theme. The group explored the island’s natural wonders, took part in customised activities, and dined at RAAYA’s signature restaurants, including Seb’s Shack, Ampers&nd, and the Italian-inspired The Village.

Throughout their stay at both islands, the media guests were treated to rejuvenating spa therapies and wellness sessions at ELE|NA Ayur, Atmosphere Core’s signature spa and wellness brand. This immersive journey offered the journalists a true taste of tropical luxury, intertwining indulgence and adventure into every experience. Their stories are sure to inspire countless Spanish and Italian travellers to discover the hidden treasures of OBLU XPERIENCE Ailafushi and RAAYA by Atmosphere firsthand.

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