When fuel costs go up, should you raise your prices? 4 questions for ContainerCo's CFO

ContainerCo has been making big investments in the Golden Triangle area. How do you model ROI and capital allocation when building long-term, capital-intensive logistical hubs against volatile macroeconomic conditions?

The focus for us, because we're making investments over 20, 30, 40-year time periods, is what's happening today isn't what's important. We look at the long-term trends and model out various different scenarios.

We have our internal metrics that it has to meet, but fundamentally what we're looking at is, is it a good strategic fit for the business, does it advantage our customers, and does it move ContainerCo forwards?

One thing that is important to do is to map out lots of different scenarios. So we look at an absolute worst-case scenario and then a range of scenarios between that and the best-case scenario.

That way, if one or two things go wrong, we've probably mapped out that scenario.

Forecasting isn't about choosing one specific answer. It's about choosing a number of different options to give yourself comfort that, no matter what happens, you'll be in good hands.

Between geopolitical disruption affecting global container flows and significant diesel price volatility hitting local haulage, it's been a turbulent year for logistics. How have these shocks impacted ContainerCo and how have you navigated the resulting financial and operational pressure?

I think we've weathered that storm very well. There's definitely been a lot going on, and I think like a lot of companies, we've tried to weather it internally.

I think the important thing here is to separate the fluctuations in prices versus long-term trends. So we keep an eye on long-term trends and, if prices need to change on the back of that, then we can make that call.

But we don't react to every individual small movement and entrench prices on the back of that. We try and weather those internally.

What we have done with the increasing oil price is use a one-off fuel adjustment fee, as lots of companies in the industry have.

However, importantly, we've separated it out from the regular price to make it clear to our customers that if and when prices come back down, we will remove that.

So it's not a permanent price increase, but it's a one-off due to an unusual situation, a temporary kind of adjustment.

You stepped up from Country Finance Manager at Reckitt, a global FMCG company, to CFO at ContainerCo. For the finance leaders in the room today, what was the biggest mindset shift required in such a move?

I think the biggest changes between those two roles are really breadth and responsibility.

In terms of breadth, as a CFO you're responsible for so many different aspects and you get involved in discussions around HR, around culture and driving the business in many, many different ways, rather than just on the finance side.

I think in a Country Finance Manager role in a big global company, you are involved in those discussions, but you're not responsible in the same way as when you're a CFO.

I think the other thing is the responsibility that you've got as the CFO. You're the ultimate person to make the decision.

In a global organisation, while I was the head of finance in New Zealand, I still had a regional finance director above me and several layers above them as well.

Whereas at ContainerCo, the buck stops with the CFO. So it's about making that mindset shift to being the person responsible.

And it's just more of a shift between being a custodian of the finances to more a custodian of the business as a whole.

There's a lot of hype around AI transforming the finance function, but what do you think finance leaders are getting wrong about AI today and, conversely, what's one opportunity you think is seriously underrated?

I think with AI it's very much an emerging space, and I think we're all figuring it out, learning what can we do with AI, where can it add value and where not.

I think one thing that potentially is being looked at the wrong way is companies that are looking to reduce headcount or simplify work. I think it's more of a focus on what are the actual productivity gains that we can make.

I like an interview I saw a few years ago about electric bikes coming into mountain biking. The comment there was that mountain bikers who use an electric bike don't get less of a workout. They just go a hell of a lot further.

And I think the same can be applied to businesses that really embrace AI the right way. It doesn't make the job easier. It just means that we can do certain tasks easier and therefore be a lot more productive, go a lot further and get a lot more out of our time in the day.