German express operator GO! Express & Logistics generated solid growth in 2009 with anincrease in shipment volumes of 6.5% and expects to grow by a further 6-8% by the end of 2010.
The positive results are accompanied by a price increase of 3% on standard rates that came intoeffect in August this year despite decreasing demand for express products last year, the newmanaging director Ulrich Nolte said at a press briefing.
Nolte said that the year 2009 led to considerable structural changes as customers downtradedfrom express to parcel services which are increasingly replacing premium products. “There was amassive price war, especially for international business,” he said. In particular, the integratorshad offered low rates to fill their capacity, he revealed.
He stressed that GO has profited from the global crisis last year as companies were switching toroad transportation which is the company’s main focus. “There is a growing demand for timelyavailability of products at short notice which is what clearly distinguishes us from ourcompetitors. In September, we even surpassed our growth expectations for this year with a shipmentvolume increase of 10%,” Nolte stated.
In 2009, the privately-owned operator had 3.3 million express shipments. Its revenues andprofits are not disclosed.
During the first eight months of 2010, the company already generated a volume increase of 7%compared to the previous year more than doubling the estimated overall market growth of 2-3%. “Weare glad that we have established ourselves as a reliable business partner for our customers with asector-related, individual and customer-oriented approach. However, we review our processes in aself-critical way on a permanent basis to improve them,” Nolte explained.
Nolte, a former senior manager at DPD, DHL and GLS, stressed that all 15 regional owners of thecompany were profitable last year and had no plans to sell their holdings in the domestic expressoperator.
GO emphasized its ability to fully adapt to customers’ delivery needs. “On request, we can pickup a shipment very late in the evening and deliver it early in the morning with customers choosingthe delivery times in a flexible way apart from GO’s basic products including 10:00 and 12:00delivery,” Nolte claimed.
As one example for the company’s service improvement, he mentioned the order&track systemswith additional features. Through these, GO optimises processes in a user-friendly way and alsoprovides proactively detailed information on the shipment status. This is part of the company’sconstantly developing IT operations.
In addition, GO is investing in a new sales structure centralising its operations which arecurrently split up in regional markets. In the future, all the business activities should gothrough GO’s central office, Nolte said.
GO said the express market has started to split up. On the one hand, there is a transition fromthe express bulk business to standard shipments. On the other hand, demand is increasing forspecial services in special cases. “The centre span of classical express services is expected to continue shrinking. The market for B2B and B2C e-commerce will grow further and offer along withfavourably priced products more and more high-quality products with reliability and punctualdelivery being more important than the lowest price,” Nolte predicted.
Despite the stable domestic demand, GO’s international business continued to decline in 2009.The company didn’t put up its prices during that year.
“The coming years will be marked by exciting challenges because we need to further expand ourmarket position. This also includes always focusing on added value for our customers as well asadapting our service range to their demands on a permanent basis, for example through improved ITinterfaces. In this respect, we have strong competitive advantages thanks to our corporate companystructure.”
One of the challenges will be further marketing the GO brand to make it more prominent outsidethe company’s customer base. Therefore, it is important to identify target groups and find a betterway to get in contact with them through establishing and strengthening business relationships andorganising personal meetings on site, Nolte pointed out.
At an international level, Nolte considers the Europeanisation of GO’s network an importantpriority. It already has subsidiaries in Austria, Czech Republic, Poland and Switzerland. Thecompany is looking for partners to establish an international line haul network. About 15-20% ofits volumes are international.
In terms of B2C business, Nolte said that trade in general has undergone a structural changewith a classical separation of B2C and B2B not existing anymore. Today, B2C traders like Amazonalso include an express share. Many traditional GO customers have B2C businesses, Nolte noted. Asan example, he named document delivery as a typical B2C business.
In terms of investment, GO plans to further expand in IT but no major operational investmentsare planned for now after the company already invested €5.5 million in its hub in Niederaula,Central Germany.
At an environmental level, GO has integrated sustainability as part of its corporate strategyright from the beginning focusing on reducing its CO2 emissions considerably. The company isconstantly working on optimising its network, fleet and energy management which has direct resultson its profits and sustainability at the same time. “The more we optimise our network, the betterresults we will get. Unecological means uneconomical at the same time,” Nolte concluded.
