German consumer parcels company Hermes Logistik is looking at Italy and Spain as its next potentialmarkets, according to managing director Hanjo Schneider. The company will open up its 13,000 German
parcel shops to minority holding TNT Post for letter services in January 2008.Schneider told the Deutsche Verkehrs-Zeitung (DVZ) in an interview that the company’s July 1entry into the Austrian market had been a complete success. Hermes was targeting 20% B2C marketshare in 2008, with about 80% generated by mail-order deliveries for parent Otto Group, he added.Hermes, with turnover of EUR 1,016 million in 2006, claims a German B2C market share of about 37%.
“After the market entry in Austria, I can imagine us looking more closely at Italy and Spainin the near future,” Schneider said. With its sister companies in Britain (Parcelnet) and France(Mondial Relay), Hermes already covers 70% of the European B2C market, he noted. Mondial Relayrecently announced plans to enter the consumer parcels markets in Belgium, Spain and Portugal,while Parcelnet has grown through the acquisition of the Redcats courier network. “We are nowworking with an agency on an umbrella brand strategy for all of Europe in order to combine theseactivities. This should be completed by the end of the year,” Schneider added.
In the mail sector, Hermes would exclusively open its 13,000 Parcel Shops in Germany to TNTPost, in which it holds a 29% minority share, to collect business and private letters from January1, 2008, when Deutsche Post’s remaining domestic monopoly is due to expire. “This will make us themost important service provider in the mail market alongside Deutsche Post,” he commented. TNTPost, which will soon cover 100% of German households, is aiming for a market share of 10% withinthe next 3-5 years, he said.
Schneider predicted that German mail prices will drop by 15%-20% following liberalisation,and reiterated his call for Deutsche Post’s VAT exemption to be scrapped since it was no longernecessary to protect the universal service provider.
