The German CEP industry is heading for a strong end to 2016 thanks to continued double-digit e-commerce growth while the country’s overall logistics market is growing steadily at a low single-digit rate, according to several new studies and forecasts.
Online and mail-order sales in Germany increased by 10.4% to €11.5 billion in the first nine weeks of the fourth quarter, according to a major consumer survey by the country’s e-commerce association Bevh. E-commerce sales grew by 11.6% to €10.7 billion, representing nearly 93% of total interactive sales, while traditional mail-order sales made up the remaining 7%.
The German interactive retail sector now predicts overall growth of 10% this year, including a 15% increase for e-commerce sales.
“The hot period of the Christmas season still lies ahead of us but we’re already ahead of expectations,” said Christoph Wenk-Fischer, the association’s executive director. “Every 12th present under the Christmas tree will come from the web. This year we’re also giving presents such as large and seemingly unromantic goods such as furniture and household machines,” he pointed out.
Sales of household goods have soared by nearly 25%, and furniture by almost 22% in the first nine weeks of the fourth quarter, according to the Bevh survey. A separate survey by the EHI institute of the 1,000 online shops with highest turnover in Germany found that the top 25 ranking now contains two furniture specialists, Ikea.de (22nd) and Home24.de (25th) for the first time, while ten others, including Amazon and Otto, also offer these kinds of goods.
However, e-commerce growth in Germany is mainly being driven by market leaders, the EHI study ‘E-Commerce Market Germany 2016’ also showed. “We can see that market concentration has intensified in recent years and we expect this for 2016 as well,” commented Lars Hofacker, head of e-commerce research at the EHI Retail Institute.
E-commerce growth is a major factor in the bullish expectations of the German CEP industry for this year. The country’s Parcels and Express Logistics Association (BIEK) has predicted a 10-12% increase for B2C volumes this Christmas.
Individual parcel carriers also expect good peak season growth. Hermes said in late October that it expects a 20% year-on-year rise in peak volumes in Germany to about 100 million parcels, boosted by new customers including Zalando. DPD has forecast a 15% rise for Christmas season deliveries. DHL and GLS have not made specific peak season growth forecasts.
For 2016 as a whole, BIEK now expects the German CEP industry to increase volumes by more than 7% to well over 3.1 billion shipments and to expand revenues by at least 3.5% to more than €18 billion. In the first half of this year, overall CEP volumes increased by 6.8%, driven by a 7.5% rise in parcel volumes (B2B and B2C) and a lower 3.3% rise in express and courier shipments, according to a study by KE Consult for the association.
In 2015, the CEP market grew by 5.9% to a total of 2.9 billion shipments while revenues increased by 4.6% to €17.4 billion, according to the annual BIEK study published in May.
Meanwhile, the overall German logistics market is continuing to grow this year after a 2.5% increase to about €253 billion in 2015, according to the recent ‘Top 100 in Logistics’ study by the Fraunhofer supply chain services research group. The main growth drivers remain e-commerce and international trade, although the latter is growing at a relatively weak level.
The German Logistics Association (BVL) expects the market to grow about 2% to €258 billion this year after a weak start to the year was followed by improving business in the third quarter. For 2017, the BVL predicts a further 1.9% rise to about €263 billion.
“The reasons for the fairly cautious estimate are various global crises and political decisions in the EU, Eastern Europe, Middle and Far East, and the USA,” BVL chairman Prof. Raimund Klinkner told the recent German Logistics Congress in Berlin.
Apart from these political and economic developments, digital transformation in logistics was a key topic at the congress. Many speakers highlighted the potential and opportunities created by the ongoing digital transformation which is being driven primarily by consumers and producers of consumer goods. However, most companies are waiting for proven solutions to be developed before undertaking large-scale projects.
The BVL’s annual congress was attended by more than 3,300 logistics managers and other participants from Germany and abroad.
