MENLO Logistics (Menlo) opened a new warehouse and distribution centre in Singapore yesterday, with plans to expand its business here.
The new 50,000 square metre facility at 21 Benoi Sector takes the company's footprint in Singapore to eight facilities totalling 219,700 square metres. The US$1.5 billion global logistics and supply chain management subsidiary of New York-listed Con-way Inc plans for more.
Speaking to The Business Times yesterday, Robert L Bianco, president of the California-based Menlo, said that the company is looking to grow its finished vehicle logistics business here, and expand into healthcare logistics and also set up a facility to serve its newly established entity in Indonesia.
Mr Bianco said that Singapore has been very successful for Menlo, where it has had about 20 per cent growth over the last several years.
"It is rising in prominence as perhaps South Asia's most important and vibrant logistics hub. The greatest benefits are its central location for distribution to South-east Asia and as far as to India, a good supply chain skillset and an ease of doing business with government authorities."
"Initiatives like Singapore Customs' Secure Trade Partnership programme, which provides sensible regulation and a secure environment for trade, are a major incentive for expansion. It's a key reason why we have continued to invest and build capacity here," he added.
Mr Bianco revealed that Menlo's business in Singapore is also growing due in large part to its strong market share in wine and spirits distribution. The company also participates in warehousing/distribution for aerospace, consumer electronics, hi-tech, automotive and industrial goods.
Menlo serves a suit of multinational companies in Singapore, including Pernod Ricard and Bacardi Martini, which are wine and spirits distributors, and electronic consumer firms such as Canon and Philips. It also has Singapore customers including Performance Motors, which is the distributor for BMW cars, and Komoco, which distributes Hyundai cars.
Menlo has signed a long-term lease for the facility it opened yesterday with its real estate partner, Mapletree Logistics Trust (Mapletree), with the latter putting in a capital investment of S$127 million into the facility.
"In this case our facility lease may be longer than a customer's contract. For Menlo, Singapore is unique in this regard because of the strong demand for space. In other countries, Menlo will typically have a shorter building lease expire at the same time as the customer's contract."
The Benoi centre will have 100 employees, with 60 per cent of them Singaporeans, in addition to the 400 employees it already hires in its seven facilities here.