The Culture of an organization is internalized the second you enter the premises, there is always an aura that envelops you and informs whether you are entering a dungeon or a garden. An organizational culture is nothing but a representation of the attitudes and conviction of its leader and Captain’s Freight is a living testimony of this. You are welcomed and greeted with an authentic smile and the place brims with energy and activity, this place is an embodiment of how a professional organization should be. Mr. J P Sharma, CEO of Captains’ Freight Services in Dubai Airport Freezone is a pioneer of Mobile Phone Logistic Services in the UAE and as an extension of the Middle East. I had an opportunity to have a frank discussion with him about his journey from being a Civil Engineer in the Indian Government Services to forming one of the leading companies in the Middle East. While Mobile Logistic Companies are struggling to fill in space in their warehouses, Captain Freight’s 2 warehouses in DAFZA and another 2 in Garhoud opposite Cargo Village work overtime to manage the continuous incoming of goods while regularly running out of storage area; something that speaks volumes of their customer’s trust and the services offered by them.

We kicked off the discussion while having the best Masala tea in town in his office.

Najib: Great catching up with you Mr. Sharma, I do understand that this is the busy time of the day but I wanted to speak to you and see the action as well?

J P Sharma: You are welcome and it’s a pleasure to speak to the wider audience through your blog, yes afternoons are a bit hectic but you will be able to observe the main activities through my office.

Najib: Please take us through your professional journey, I am sure the readers are anxious as I am to hear the details?

J P Sharma: I am originally from Himachal Pradesh a State in Northern India. I am a Civil Engineer specializing in “Road Construction” and spent the first 4 years of my career working for the Central Government’s “Border Roads Organization”. These early years had set the tone for me for a Services Industry as the main task in “Road Works” is “primarily people management, little did I know that destiny was guiding me towards a certain path through this tough work. In 1981, I was selected by the Government of Libya’s Ministry of Communications that oversees the Infrastructure of the country and was positioned as a consultant for the countrywide roads project.

Najib: Libya, that must have been challenging and interesting at the same time?

J P Sharma: Well I would say that I had one of the best years of my professional and personal life out there. On one hand, I excelled in my work in an extremely tough terrain in a multi-ethnic and multicultural environment further refining my people management skills. On the other, I got married to Kusum Sharma in 1983 and had 2 wonderful daughters there as well. I stayed in Libya until 1992 and decided to leave the country as the educational options were limited for my daughters. We loved Libya and the culture but the choice was either to send the family back to India or to make a move together somewhere else. My son Deepan was born while I was in the process of moving countries in 1992.

Najib: So where did you move next?

J P Sharma: I had various choices between Europe and the US but finally decided and settled on Dubai for assorted reasons. First of all, it is close to India with regular flights, culturally it was closer to home than any other country in the region but the foremost consideration had been security; with 2 young daughters and a newborn son, I wanted to settle somewhere I could focus on my work without being worried about the family, I found the best of both worlds in this country.

Najib: So, what did you do next professionally after settling in?

J P Sharma: I had always wanted to do something for myself especially after 15 years of working in a tough environment. Road Construction business was out of the question as I didn’t even have funds to buy a single road roller. I considered several businesses but finally came across an option of taking over a logistics company; this business resonated a bit with my previous work as it was a service Industry and I knew that my people management skills would come in handy. Captain’s Freight was a company formed in Dubai in 1988 and the partners were struggling to keep it afloat by the time I had come to Dubai in 1992. I had the foresight of taking over this sick unit and turning it around with hard work and dedication that was second nature to me. As for the specifics of Logistics, to tell you the truth I did not have any experience in this line but I nonetheless took the plunge and started the office with just 1 employee. I knew man management and this work would never be as hard as the tough cookies I used to manage in road construction in Libya working at 55C temperatures.

Najib: How long did take for you to get a hang of the new trade as you were moving from being an employee to an Independent entrepreneur?

J P Sharma: I would take you in a little secret, something of a lesson in dedication and hard work. I had split 50% of my savings from Libya for my family and another 50% of the funds for business. The business funds quickly started getting depleted and at the point of time I had the absolute support of my family and staff members. We all believed collectively that we were doing the right thing and the situation would eventually be improved. I survived on minimum, 1500 Dirham per month was set aside for the family living expenses and we used to buy groceries from Hamriya Vegetable market every week on sharing with a friend to save expenses. I never compromised on company growth and did it even at the expense of personal luxury, I am fortunate to have the most amazing family supporting me throughout. It took me three years to turn the business around.

Najib: What products were you dealing in initially?

J P Sharma: I had 2 warehouses of 7000 Sq. ft. capacity. We dealt in Electronics Items, Hardware, and Garments, it was more of a General Cargo trade than a specific product line. In those days, we got a lot of support from Ratans Group, Barakat and Al Madani Group (Branded Clothes). We never compromised on investing in infrastructure and the fleet and till today we add at least 2 vehicles if not more every year. At this stage, we are handling around 500 containers per month. Today we boast of an active fleet of 72 Vehicles of mix use including heavy truck and trailers. We invested a lot in the company and recruited key talent, the first people I had hired are still with me after all these years.

Najib: Your team tends to stay with you for a long time unlike your competitors who have a high employee turnover, why is that?

J P Sharma: My team members are no less than my family to me. It’s not just money but respect and relationship that counts in any setting. If you are with them in their tough times then they will be with you forever. We provide company accommodation to my team, we also support them for meals. I have been providing company medical and life insurance to my team for the last 10 years much before it came in as a law in the UAE.

Najib: Can you relate some specific employee support for us, please?

J P Sharma: Well if you insist then I would like to relate 2 instances. The company watchman Alam Khan from Swat, Pakistan had asked me to hire his son. Would you believe that his whole village is now employed with us and it is now taken for granted that any boy of working age would come and work for us? Once you take care of people then the whole team feels secure and would become a part of your legacy. The second incident was with one of our drivers who needed a kidney transplant as both his kidneys had failed and asked to leave. I had him checked thoroughly in Dubai through a local Indian doctor, Dr. Prem Kumar Sinha who had him referred and secured his appointment at SIUT, Sindh Institute of Urology and Transplantation in Karachi and completely supported him financially. I gave him a light job and facilitated his regular leaves to go to Karachi for checkups, he is still working with us. Several other support mechanisms are freely available for my precious team members. We celebrate all religious festivals in my place and get them a feeling of homeliness.

Najib: This is impressive Mr. Sharma, I hope that this approach is passed on to the next generation of leadership as well?

J P Sharma: Yes, of course, my son Deepan had to work in the warehouse for 4 months after graduating from Australia and had to work his way up. He is as dedicated and caring for the team members as I am.

The beginning of the Mobile Phone Logistics Business

Najib: What is the current split of your business between mobile phones and general cargo logistics?

J P Sharma: I would say that it is around 50% of general cargo and another 50% of the mix between electronics and mobile phones. We are wary of the market’s dynamics and are always on a lookout on the changing tide so it’s not wise to have the dependency on a single sector. Although the mobile traders know us as an expert in their specific field but we are actually quite diversified.

Najib: This is a very smart move Mr. Sharma, coming to Mobile Phones, how did you get into this business that has basically become the face behind the name of Captains Freight?

J P Sharma: In 1997 / 1998 we had a stable and profitable business and this was also a time of an upsurge in mobile trade. Brands like Ericsson, Nokia, Motorola, Alcatel, and Siemens had started to bring in rapid innovations and prices had fallen to affordable levels. The mobile was now within everyone’s reach and the traders were cashing on the opportunity. There was no concept of Independent Mobile Phone Logistic companies at that stage. I could see that it wasn’t possible for me to do Mobile Logistics in parallel with Land, Sea and Air Freight as the pace of Mobiles was way too fast. I could somehow predict the trend at the right time and decided to focus on Mobile Logistics as an independent unit. We started helping unorganized traders consolidate their shipments from all over the world and carried out the business in a structured way.

Najib: What prompted you to make a move to DAFZA?

J P Sharma: This is a very good question; we were still operating from our local office in Dubai-based in Garhoud. The customs duty on mobile phones during those days used to be 5% and we had to deposit huge sums of money with the Dubai Customs for Re-Export purposes. With the upsurge of business, it was becoming very difficult for us to manage these deposits so we decided to move to the free zone in DAFZA. These were the days when there were only 4 Blocks there with the presence of Global giants such as FedEx, DHL etc, I felt a bit apprehensive to be the first local company in the presence of these behemoths. The other consideration had been the cost that was substantially high as compared to one I was paying in the local market, nonetheless, I am fortunate to have decided to make this move. I was the only local company in DAFZA for the next 5 years and it provided us a great head start and then there was no looking back. Because of our move to DAFZA and the exceptional facilities provided by the Freezone Authority a lot of our customers followed suit and DAFZA became a hub for Mobile Phone Business in the Middle East.

Najib: Any specific customer names you would recall who supported you in the initial days of mobile phone trading?

J P Sharma: Off course, how can I ever forget these companies. I would recall Sol Telecom, CTI, Cellucom, Rixos Mobile, Naam Trading, Eurotelecom, Celltel, Blessings, Papita Trading, Onesto / Midcom, Foneart, BCI, Africom, Conplex International, Computech and Handyfone to name a few.

Najib: What has been if you could let your readers know has been the secret of your success, all logistic companies are offering the same services but your warehouses are always busy?

J P Sharma: I would say that honesty and integrity are the core beliefs of our organization. Here are some key points to note about our company:

1.     We never indulge in trading, a lot of people give in to greed and unethically mix the two businesses but we are always clear about this point and our customers are confident that their stock is secured with us.

2.     We have a personal touch in serving our customers and treating the team members. For us, Emirates Airlines Business Class is our benchmark and we pride ourselves in providing the same level of service to our esteemed partners.

3.     We are not indulging in Re-Packaging, Re-Sealing, Activation or any other activity of this sort at all.

4.     We are very selective with the choice of customers we deal with and have a dedicated customer services team to ensure we are working with genuine players. There are times we even reject accounts based on some customer reputations after a thorough KYC process.

5.     We are continuously improving our processes. We were the first company to collect payment on our customer’s behalf from the market. If the customers would trust us with their goods worth millions then they could do the same with their funds. The single initiative increased their shipments by manifolds enhancing the overall trade in the Middle East. As you know Mobile Trade is primarily about “Money” rather than “Product” and efficiency is only achieved once the sales cycles are rapid, this is something I am proud to have achieved by my strategy.

6.     For me, the reputation of my company takes precedence on profit and my team knows this very well.

State of the Mobile Industry

Najib: Where do you think the Mobile Industry is heading? You have seen it through the seasons so I cannot think of anyone better to answer this question?

J P Sharma: It is on a decline for sure, Year on Year I can observe the trading volumes decreasing 15-20% in terms of volume. In terms of value, the ASP is somehow holding primarily because of iPhone but margins have eroded making the trade really challenging overall. Brands had disappeared but the numbers of traders stayed the same further pressuring the margins. Trading won’t disappear completely but eventually, it would move to other platforms like online. Many traders had built weak foundations and did not focus on market development so had to pack up and there are much more on the same route in the coming time.

Najib: The downturn in the Industry has disturbed a lot of players, what would be your advice to them at this stage?

J P Sharma: There is definitely a downturn and big names are falling off the chart, small traders indulging in back to back sale would be gone. Distributors, major players with direct sourcing and financial holding power would survive. I would tell them to save themselves and their capital at this stage, the price wars and margins are leading to destruction.

Najib: How are you planning to counter the downturn?

J P Sharma: We have now expanded into DWC and looking more aggressively into diversification in general cargo. Once the warehouse is handed over it would be 10 times the size of the ones we have in DAFZA providing ample opportunities for us to move ahead with the vision. Our target is to expand into White goods and International brands offering 3PL Services. We also have a fully functional office in Hong Kong and a diversified investment in Real Estate. This is in addition to a Heavy Vehicle Transport division that is one of the more profitable verticals of the company.

Najib: Now to some intriguing questions, how come you never participate in any exhibition? This is an enigma so let’s reveal the secret?

J P Sharma: All GSM Marketplaces such as handelot, gsmexchange and ipt started after our entry into the market, traders know us long before they came in so I do not see the need to participate. We do go to these exhibitions as visitors regularly and always being welcomed across. Please understand that all big traders started off in the region utilizing our services so the relationship goes way back.

Najib: So today the secret got revealed, a lot of telecoms professionals are losing their jobs in DAFZA, what would you advise them?

J P Sharma: There are various new companies also coming and setting shop in Dubai still, these people are more than welcome to contact us and we will do our best to connect them to possible employers.

Najib: What is your take on the Used Mobile Phone Business?

J P Sharma: This is definitely the future for at least the next 2 years. The major share of trading would be taken over by this vertical and this would keep on increasing.

Najib: What is your advice to the next generation of professionals?

J P Sharma: Do not try to take shortcuts in life, work hard and work smart plus focus on learning the essential technology.

Najib: I personally think that mobile trading would disappear altogether in the next 2-3 years? How should mobile dependent logistics companies start preparing for the downturn?

J P Sharma: I think mobile trading won’t go off completely but the nature of the business would change. Logistic services would always be required and only ethical companies would be able to survive this tide. Eventually, the shady players would be squeezed out that is good for the market.

Najib: What are the challenges you are facing nowadays?

J P Sharma: There is an uncertainty about which companies would abscond and you will be hit with the consequences. This is, unfortunately, a growing trend and cannot be forecasted or predicted, we are always holding our breath. There’s a lot of online fraud happening in the market and it is hampering a lot of good business as well.

Najib: How has Dubai defined you?

J P Sharma: Dubai has allowed me to fulfill my dreams, I came to this country with a vision and it has been turned into a wonderful reality. It provided me with a sense of belonging and secured the future for me, my family and the team members of Captains Freight. This is an ever-growing market for people with a positive attitude. We are as a company proud to be growing with Dubai under the Vision and Leadership of His Highness Sheikh Mohammed Bin Rashid Al Maktoum.

Najib: Any final thoughts?

J P Sharma: I would really like to thank my team members and business partners for providing us the opportunity to serve them and we would like to assure them that we would never let them down.

Najib: Thanks a million for your time and thoughts and all the best for all your future business endeavors.

<< Here is Mr. J P Sharma Live interview >>

Author: Kazi Najib Ashraf in an exclusive series for handelot.com, kazi.najib@playtorium.com