FedEx said this week that it would acquire Cargex, an international freight forwarding company, and Agencias de Aduanas Aduanamos S.A. Nivel 2, a customs brokerage company and Cargex affiliate.
The moves are designed to further last-mile operations in Latin America.
Headquartered in Bogotá, Colombia, Cargex has operations in Bogotá, Medellin, Cartagena, Buenaventura and Santa Marta
Upon closing, said FedEx, Cargex would operate as a subsidiary of FedEx Logistics. Financial terms were not disclosed.
“This acquisition perfectly complements the roundtrip Colombia-to-Miami flight recently announced by FedEx Express,” said Udo Lange, the chief operating officer and incoming CEO of FedEx Logistics, per a statement by FedEx on Thursday (Aug. 29). Lange added that Latin America remains a “key market.”
Freight forwarding, of course, includes the organization of shipments as they make their way through various parts of the supply chain and toward end consumers.
The move comes as faster delivery times – including same-day delivery – are now a hallmark of commerce, and especially eCommerce. Amazon and Walmart are but two of the marquee names focusing their efforts on the region.
But beyond the embrace of eCommerce (where some estimates see double-digit percentage growth in Latin America and where smartphones help speed the adoption of digital ordering and payments), shipments have to travel across various logistics processes that involve, among other things, documentation of insurance and customs forms.
As reported by The Next Web, the last-mile arena in Latin America is marked by increased competition. Cargex focuses on the management of perishable goods, which would include food, flowers and the like.
In a nod toward a commitment to the region, in an interview with Finance Colombia earlier this month, FedEx President for Latin America and the Caribbean Juan Cento told the publication that, among other moves, the company had opened a refrigerated air-freight facility at Medellín’s José Maria Córdova International Airport. The number of flights has increased as well, according to the executive – direct flights between Colombia and Miami now span six days a week.
“We all know what [the] important financial contributors to the different economies in Latin America [smaller businesses] are. …what do they focus on? ‘I need to start the business, I could be successful in the Medellin market, maybe we should expand to the rest of the country, well maybe you know what, would it be nice if I present my product to my neighbors?’” Cento noted that such adjacent, cross-border markets could include Peru, Ecuador and Venezuela.