Hermes Logistik, the German consumer parcels company, today announced double-digit growth, a surgein the number of parcels sent by consumers, and its entry into the Austrian market this summer.
The operator, a subsidiary of Europe’s largest mail-order company, Otto Group, increasedgross sales in the business year ending February 28, 2007, by 11.5% to EUR 1,016 million, with netsales up to EUR 872 million. It does not disclose profit figures.
Volumes in the business-to-consume (B2C) segment grew by 10.3% to 235 million shipments,increasing its German B2C market share to 37% from 35%, it said in a statement. TheProfiPaketService for medium-sized firms launched in February 2006 generated 3,000 new customersits first year.
The fastest-growing business, however, was the consumer-to-consumer (C2C) parcel business. “We are particularly proud of massive growth in private parcels,” said managing director HanjoSchneider “With an increase of 79% to 23.6 million items we have substantially reduced the gap onthe current market leader.”
The main success factor was the network extension to over 13,000 outlets, meaning Hermes wasclose to the customer, he added. The company has no plans for any automated parcel machines, hesaid, referring to DHL’s trial of such machines.
Hermes also confirmed plans to enter the Austrian market this summer under its strategy ofcreating a European B2C delivery network. It will launch services on July 1. By end-2007, thecompany aims to have five distribution centres, 35 branches and about 1,000 PaketShops inoperation.
“The Austrian market is characterised by a de facto monopoly,” explained Schneider. “Thecompetitors already active in the market concentrate on delivering to business customers, i.e. theB2B market. There is no real competitor yet for deliveries to private consumers.” Hermes putAustrian Post’s market share at over 90%.
“Experience in Germany has shown that competition is welcomed equally by shippers andcustomers. Both groups profit from more service, a stronger customer focus and, not least, fromfalling prices. Our aim is to deliver at least 20% of Austrian B2C and C2C shipments through oursystem in 2008.”
German media recently reported that Hermes would initially transport the Austrian parcels ofOtto Austria and another Otto-owned company Universal, which could amount to some 10 millionparcels a year or about 25% of the country’s total B2C parcel market.
Hermes Logistik is also believed to be looking at entering other European B2C parcel marketssuch as Spain and Italy. It is already present in Britain and France through local distributionsubsidiaries of the Otto Group.
