The Game Plan | In the region’s worst place to run a trucking business, Unifreight is buying more trucks

Unifreight put a 100 new trucks on the road last year, and is adding more

Running a trucking business in Zimbabwe has its contrasts. Take it from Unifreight, one of the country’s biggest logistics companies which runs Swift and Bulwark. CEO Richard Clarke says Zimbabwe is the region’s most expensive place to operate trucks.

“Regionally, Zimbabwean fuel is the most expensive, with our pump price at USD1.68 compared to USD1.11 in Zambia. Vehicle registration is also significantly higher at US$1,560 versus only US$132 in Zambia,” Clarke says.

“These exorbitant costs make operating a cross-border fleet in Zimbabwe less attractive. Duties levied on diesel currently stand at US$0.427c, and 25% of export proceeds are converted into ZiG, which cannot be freely converted back into USD at the controlled exchange rates published by the Reserve Bank. Luckily Unifreight has a flexible business model which allows us to change the number of assets running cross border as we need.”

So, what do you do when faced with all these problems of running a trucking business in Zimbabwe? You buy more trucks. At the end of 2022, Unifreight, whose fleet was made up mostly of Scania trucks, bought 100 new FAW tucks and Afrit trailers. They have proved more reliable than the other truck brands.

“The FAW 28-380FT units in our fleet have proven to be highly reliable, with minor issues experienced in the first 100km. The cost/KM of these units has been well below both the Shacman and Powerstar units that have been trailed in the fleet. The current FAW fuel efficiency averages at 2.34 km per litre,” Clarke says. The company now plans to buy another 60 FAW trucks this year. Unifreight is also upgrading its network of 35 depots to support its core business, Less Than Load, or smaller loads.

To manage the risks in Zimbabwe, the company is revving up its cross-border business. “We aim to invest in and grow a dedicated fleet to over 100 full-time cross-border assets. The benefits of growing this revenue stream are increased foreign currency earning potential in the group; reduced seasonal fluctuations as the current business experiences peak revenue in May and November; and reduced exposure to downturns in the local manufacturing sector,” the company has said.

Strong first quarter

In the first three months of 2024, Unifreight enjoyed a 58% increase in business from the prior year, which itself was up by 135% from the year before, according to a trading update.

“Our aggressive marketing efforts within the Full Truck Load (large shipments) market segment have paid off, despite a 17% reduction in total yield per KM due to the nature of the segment. This reduction is offset by the increased volumes being moved,” Clarke says.

What do Unifreight trucks carry?

The company gets good business from moving retail goods and tobacco. Unifreight says it was moving over 40,000 tonnes of tobacco per year in 2023, which was 91% up from the previous year. With its new fleet, the company can provide more haulage for its retail customers who need nationwide distribution. These include Delta, Triangle, Unilever, Nestle, and Cairns.

Says Clarke: “Despite a smaller tobacco crop trending towards 220 million kg for the season, we anticipate moving over 30% more volume from this sector after securing additional merchants in 2024.”