Richard White says WiseTech is taking bigger slice of global logistics pie

WiseTech founder Richard White says his company is taking a bigger piece of the logistics pie by moving into customs and compliance.

WiseTech has a bird’s eye view of the economy because his company provides technology across much of the freight chain from small operators to big global freight forwarders.

WiseTech founder Richard White has pushed aside concerns about the contracting

global economy and strike action at Australian ports, saying his company is taking a bigger piece of the logistics pie and is moving into customs, compliance and landslide logistics.

“If you think about world gross product, it’s growing at quite low amounts, but WiseTech is a growth company. It’s winning new customers, it’s customers are rolling out, it’s building new products into new markets,” said Mr White, who was speaking at the Macquarie Australia Conference.

The International Monetary Fund has warned the global economy was on the brink of

a second “cold war” as countries align themselves into regional power blocs –centred around the US and China – which could erase trillions of dollars in global output.

Richard White, Founder & CEO of WiseTech Global

At the same time, sticky inflation in countries such as the US and Australia is leading

central banks to reconsider decreasing interest rates.

The Reserve Bank of Australia is meeting on Tuesday to determine its latest stance on rates. It’s taken an aggressive stance on rates to try reduce inflation, raising the rate 13 times between May 2022 and November 2023.

Mr White started WiseTech 30 years ago with Maree Isaacs and still owns more than 36 per cent of the company.

The billionaire has a bird’s eye view of the economy because his company provides its CargoWise technology to 13 of the 25 biggest global freight forwarders. All 25 are WiseTech customers.

But he said he would leave predicting economic growth and rates to the economists, commenting that volumes have remained stable, although some customers are seeing less margins.

“Margins are down which affects our customers. Our growth is really still quite strong.”

WiseTech sees growth opportunities in driving its 13 top freight forwarders to use more of its software and also to bring the remaining top customers over to its systems.

“We have the remaining 12 of the top 25 that we still have to sign,” said Mr White.

“Maersk is now using our systems. Many of others in the remaining 12 look like targets.”

“We are getting more of the total pie rather than worrying about economic growth,” he added.

When asked about whether the strike action at Australia’s biggest stevedore was still causing issues, Mr White said that this was a short term blip.

“Australia is one and a half percent of world GDP and we are largely a global company, Our business in Australia is quite large, but the remarkable thing is that whenever those choke points happen they clear very rapidly and the backlog comes

through anyway. Whilst the strikes were bad and made a bit of a mess of things, that was very short lived. Now it’s all caught up and it’s back to work.”

The WiseTech founder also commented on staffing issues, after the bosses of two companies it purchased resigned, saying those people had made “decent money” from the purchases of those businesses and were not longer key.

“I have no concerns about those positions leaving,” Mr White said. “Those people built form startup businesses to were reasonable in size for themselves but tiny for us and sometimes you need leadership that understands how to bring forward all of those things into our core stack. Almost every acquisition we buy we rewrite the software.”

As for over all retention of staff, Mr White said WiseTech has a “very strong compensation plan which includes options that have been very valuable.”

The company has been able to attract “high-quality” talent and is putting on 25-30 people a month.

He said the company had lost five people that were middle management but significant during the hiring start-up tech hiring frenzy, but three of these had now returned.

“They’ve come back because they lost their jobs, which is a great story, if you leave the company and want to come back, you’ve lost your share plan and you are going to come back because it’s a better place to work.”

WiseTech’s shares are up 24 per cent since the start of the year after the freight software provider beat market expectations for first half earnings and forecast improved margins in the second half.

WiseTech listed on the ASX in 2016 with a share price of only $3.35 and a market capitalisation of $970m. Its shares have risen 28-fold since then.