Its industry has shown significant growth Supply chain in Greece in their relative ranking The World Bank for 2023. It is ranked 23rd this year, up from 42nd in 2018 (the last previous year of the survey) across six criteria. These include the level of infrastructure, customs clearance procedures, the quality of services provided, the ability to control and account for goods, the availability of competitive prices and terms of delivery and receipt of goods. The latter is a key factor, with the average time required to move a container from port of entry to destination along all existing international routes estimated at 44 days. At the same time, about 60% of the time of transit of goods falls on sea routes, while the largest source of delays is associated with the jamming of containers either at the point of departure or at the point of destination.

“The really impressive rise of our country in the ranking Logistics Performance Index (LPI) came to reward efforts to improve the supply chain and the logistics sector. The ever-increasing expectations of logistics with a focus on Greece, has created a number of investment actions, mainly in the real estate market and the acquisition of important companies in this sector. notes Nikos Rodopoulos in “K”.former chairman of the board of directors of Hellenic Logistics Company.

Indeed, logistics, warehousing and distribution real estate are a magnet for investment. Reducing the delivery time on the “last mile” (from the last point of storage to the consumer), which provides a competitive advantage for business, makes warehouses, especially elite warehouses, attractive to capital. Against this background, mobility in logistics, fueled by the acquisition of real estate by investment companies and the start of projects. In this direction, the Med Frigo group from Patras and its subsidiaries Cargo Med and Med Energy were recently acquired by Elikonos 2 SCA Sicar, EOS Hellenic Renaissance Fund, BEARONEM Limited and A. Mavridoglou. Also, the American fund HIG Capital is developing into one of the largest players in the Greek warehouse and distribution center market, having recently completed the acquisition of 80% of the Orfeas Veinoglou family business, which is showing strong double-digit growth. bid.

HIG also acquired Makios Logistics, which has two warehouses in Thessaloniki and a fleet of over 300 vehicles, and Olympias-Kandylis. According to information, the fund is focused on the acquisition, which can be completed in the near future, of two more logistics companies, whose turnover is from 15 to 30 million euros. A joint venture between Goldair and ETVA VIPE is expected to start construction of a cargo center at Thriasio Pedio this year, an investment valued at more than 200 million euros.

Large investments, combined with the fact that Piraeus is among the largest ports in Europe, have modernized the sector.

At the same time, the fact that Piraeus secured its position as the first major port in Europe for ships arriving from the Far East, combined with the strengthening of the role of the port of Thessaloniki after its privatization, contributed to the improvement of the international ranking of Greece.

The road is long

“Greece’s ranking in the Logistics Performance Index (LPI) should not reassure the market, government and institutional bodies. The problems do not have complete solutions, and the existing unresolved issues are still significant. National logistics centers do not yet exist, the existing fleet of vehicles remains obsolete, activities to attract international cargo with the prospect of easy processing and production of national importance have not been implemented, and agrologistics (ss: agro-food supply chain) are still history,” emphasizes Mr. Mr Rhodopulos.

“We have to be very careful. The LPI, which essentially reflects sentiment but sets trends and momentum, must remain high to maintain high expectations. The use of logistics as the fourth pillar of development can facilitate significant new productive – this time – investments and catapult 10% of GDP to more than 13%,” he concludes.

Demand explosion

According to a recent survey by Cerved Property Services, demand for logistics space remains strong this year. Greek real estate investment companies and institutional investors are stepping up their investments in newly built high standard logistics buildings that are certified according to green and sustainable development criteria. Last year, they launched or completed a series of targeted investments involving large, state-of-the-art dry and cold storage facilities. This year it is expected that about 180,000 sq.m. new warehouses will be added to the existing one in mid-2023, and another 100,000 sq.m. until the end of 2024.
Increased demand has also increased the cost of acquiring real estate with specifications for the development of warehouse and distribution centers. In Triasio, the area where the vast majority of new buildings are concentrated, the value of the land corresponds to 4/5 of the total investment. Due to rising raw material prices, the cost of building new logistics space has increased by more than 30%, from 450 euros/sq.m. 600 euro/sq.m. Thus, according to the CPS study, any new large warehouse is sure to attract tenants in the months before opening, leading to higher costs and rents.

Strong prospects and significant competitive advantages

According to a recent survey conducted by the Hellenic Logistics Society and chaired by Aegean University Associate Professor Vassilis Zeybekis, in order to maximize the contribution of the logistics sector to GDP, companies will have to face a number of challenges. Significantly, as indicated, although road transport accounts for the lion’s share of 69.5%, the fleet is aging and has limited capacity, and there is no synergy. In addition, the study should focus on making the port of Thessaloniki the center of the Balkans, as well as strengthening the transfer of transport, distribution and warehousing activities to logistics service providers. This is because this practice allows companies to focus on other, more profitable activities.

Today, the sector’s contribution to GDP, which is about 20 billion euros, can be significantly increased. As mentioned in February last year at a meeting of the Parliamentary Committee on Research and Technology, chaired by North Dakota MP Prof. Christos Tarantilis, on “technological innovation in the supply chain and transportation”, Greece’s potential in this sector is very large. And this is both due to the favorable geographical position and the significant competitive advantages that the country has, since maritime transport, the sector in which our country is the world leader, represents about 80% of world trade in terms of volume. For this purpose, it is necessary, as already noted, to introduce information and communication technologies (ICT) throughout the supply chain in order to reduce bureaucracy by automating processes, increase efficiency and reduce costs.

The geographical position of the country and strong shipping create conditions for further development.

Also, according to experts, Greece should strengthen its role in the transit of goods related, in particular, to the automotive industry, white electrical appliances or even clothing and shoes. In addition, the influence of the country is particularly limited in terms of providing services for the processing, easy assembly and labeling of products that today simply transit through Greek ports.

Therefore, the “key” lies, as analysts say, in the formation of a unified strategy between ports, railways and transnational groups that are clients of a particular ecosystem. One of the main reasons for betting on Greece becoming a global transit hub is related to the simplification of the zoning regime and licensing of cargo centers, as well as the possibility of securing funding.

Funding for supply chain digital transformation and infrastructure upgrades through the Recovery Fund is reported by market players as the last possible opportunity to transform a complex but high value-added sector.