Chile is amongst the longest countries in the world. With over 4300 kilometres in length, the logistics industry has its own set of challenges. For this month's issue of Logistics and Beyond, we speak to Mr. Rodrigo Izquierdo from Integral Chile, about their journey since the company’s establishment three decades ago. In addition to the challenges of the local Chilean market, Rodrigo also shares his insights into the everyday challenges faced by the logistics industry now, and how being swift and responsive is the only way forward in this volatile industry.

In conversation with Rodrigo…

PL-Alliance: Integral Chile was established in 1992 and since then has expanded to be one of the biggest logistics companies in Chile. Can you tell us a little bit more about this growth and how does this three-decade-long journey look like?

Rodrigo Izquierdo: It would be better to say that we are an important and solid company for logistics in Chile. We focus on innovative solutions based on customers' needs, which is why we don't aim to be the biggest or the largest company. At Integral Chile, we aim to achieve a size that allows us to have complete control of all operations. We want our clients to receive quick answers from a proper specialist. We don't want to sacrifice quality over quantity.

After 30 years in the market, we have learned a lot from our experience. This is also why we can manage logistics for certain cargos where others can't. We also have an excellent capability to respond to emergencies because in logistics, the unexpected usually shows up sooner or later. Over the years, we have developed solid relationships with different players in the industry. We genuinely believe that everyone is a commercial partner, not just a supplier or just another agent. If the business is successful, it's a win-win for each of us, and that's how you build trust.

PL-Alliance: Chile is among the world's longest countries, and this comes with its own set of challenges. Can you give us an insight into some of the logistical challenges you need to overcome to ensure successful transportation?

Rodrigo Izquierdo: In my experience, in Chile, our geographic circumstance is an advantage because transportation is pretty straightforward. Our country is long and slender with excellent highways and roads. There is no need for alternative travel routes between cities, making things more accessible. I'd say that the main challenges usually occur when covering long distances within Chile, but it would depend on the cargo's urgency. As for ground transportation, we always have a very tight control and can fulfil almost any transit time, and one of our success factors is our set of proven and specialized transport partners. We have different alternatives and a wide variety of vehicles for different needs with good availability.

On the other hand, currently the main issue is the space availability from all ports due to the global situation. For some traffic routes it is tough to get space, but it is still possible.

PL-Alliance: Integral Chile is serving all verticals of the transportation industry, starting from small packages to project cargo. With such a stronghold in the market, what are Integral Chile's service capabilities and what sets you apart from other logistics companies in the region?

Rodrigo Izquierdo: First of all, what we have that others generally don't is the synergy between our international and domestic divisions. We are an experienced company handling not just logistics, but often also the operations with our own people. This translates to quicker coordination and faster delivery to the final destination than our peers.

For example, in our domestic division, we go beyond knowing that some cargo is just general cargo. A 4 kilograms package could be a water sample that has to be delivered at a laboratory more than 1,500 kilometres away in less than 20 hours; a replacement part for a brokedown machine; or a medical instrument needed for an operation at a specific hospital; or critical documents that have no rush but need to be delivered safely. Understanding what we are doing and its impact is essential. It looks obvious, but you can never lose this focus.

As for larger cargo, such as project cargo, it goes the same way. For instance, when shipping a 63MT industrial drier, simply fulfilling a deadline or even making it ahead of time can really make the difference. Such equipment is for sure committed for another project, we understand that, and we'll do everything to avoid any delays, even if we are no longer involved directly. If we have to use a port that is further away or require additional services, we'll present our solution to the customer and go ahead if they agree.

Another example was when we managed Gorillaz's electronic equipment for the concert in Santiago in May, and then had to send it to the next show in another country the following morning. To fulfil the tour's planning, we had to use a different aircraft and reorganize and rearrange the cargo. This tallied up to 12 tons and 5 PMCs instead of the original 4, due to the new aircrafts size restrictions. This was all done working hard at night and the following morning. Of course, our excellent relations with the airline also helped us get the additional space when we realized we needed it.

That's how we do things; And yes, it's Gorillaz, the electronic music band :)

PL-Alliance: The war in Ukraine is already affecting the Global Supply Chain heavily. Apart from heavily impacting the agricultural sector, where else have you seen the ripple effects?

Rodrigo Izquierdo: Here in Chile, one of the heaviest impacts is the fuel increase, which is even more commented on than the agricultural issue. Of course, it is not only fuel for particular vehicles, which is well covered on the news, but consequentely, this has prompted many transport companies, both local and international, to increase their price due to higher costs. Airlines have added a fuel surcharge, sea freight prices raised at the beginning prices are up, and cargo pick up becomes more expensive as trucking prices increase.

PL-Alliance: Customs generally take longer in South America compared to Europe or North America, but Chile has been an exception. How is the procedure different in Chile that makes it an exception?

Rodrigo Izquierdo: Chile has stringent customs regulations and operates similarly all over the country. If you know how to manage your cargo, which kind of documents are needed, and which specific regulations are valid for the nature of the shipment, you shouldn't have issues. It's almost a matter of pass or fail, and it's usually not ambiguous. It's just how it has been for so many years that I wouldn't say it's a specific policy or something like that. But after all, this is an advantage over many other countries in the region.

PL-Alliance: Chile has been steadily investing in renewable energy, but most of the projects came to a standstill during the pandemic. With most of the projects now restarting, what does the second half of the year look like? Do you already have a busy 2023?

Rodrigo Izquierdo: In my opinion, there have been a lot of recent circumstances that have put big investments on hold. First, it was the social outburst in 2019 and immediately the pandemic, with its long-lasting effect that is still very strong worldwide. But particularly in Chile, there was a high degree of uncertainty due to the presidential elections with candidates with very different positions. Finally the people elected a young president with new ideas. There was also the voting to have a new Constitution because the one that we have is from 1981 and formed during the military regime from those years. The wish for a new Constitution overwhelmed the conservatives, so there was more uncertainty until the appointed committee developed it. Now we voted again to accept or reject this project, where people opted for the later and now we have to determine which path will be taken for this eventual new Constitution. Big investors are not fond of uncertainty and regulations that change, and some projects are meant to start or resume, but I think there is some more waiting to see how this all unveils.

On the other hand, many long-term and ongoing projects have already started or can't be stopped. This is what keeps us busy as we take part in some of them, such as in the energy but also industrial and infrastructure field.

Chile has a huge potential in renewable energy resources because its geographics allows for easy cultivating and utilization. Still, at Integral Chile, we are very attentive to when (not if) these projects and others will be fully reactivated. If things go as planned, we will have a lot of work to do in the following years.

Related links

Integral Chile S.A. Website
Integral Chile S.A. LinkedIn