GeoPost, La Poste’s express parcels subsidiary, is showing strong growth rates both for domesticand international business this year, boosted by fast B2C growth and a solid increase in B2B
volumes, as well as innovative services, Christian Emery, Executive Vice President and COO Europe,told journalists in Paris yesterday.Emery told CEP-Research in an interview: “During the first five months of this year (ending inMay), our B2C and B2B volumes grew by 6-7% on the domestic level and 10% internationally, comparedto May 2013. When splitting our B2B and B2C volumes in Europe, we can say that B2B has grown 6%during the same period, which is really good compared to the European B2B average growth of 3-4%.But B2C volumes have grown twice as fast with 12%.”
He stressed that in spite of rapid B2C growth, the company will continue focusing in the sameway on B2B as its traditional business.
Asked about main European market trends, Emery mentioned service quality, service improvementand innovations as increasingly important factors, which should respond to the demands of themarket and the recipients. “In addition, constant productivity increase is very important, with thelong-term tendency of prices going down which are not expected to go up again anytime soon.”
As for the partial acquisition of the French B2C delivery firm Colis Privé by Amazon, he said: “This is a sign that Amazon wants to gain ground in the French market which could become a potentialthreat to La Poste in the long term, with Chronopost and ColiPoste being the two big B2Cplayers.”
Looking back at GeoPost’s recent development, he said: “Starting out as a traditional B2B parcelprovider, GeoPost began operating in the B2C market in 2008. This was a lot of work as the B2Cbusiness includes different transport models, processes, customer service, guarantee compensations.This is another and more complicated business than B2B, or rather it was in the beginning. So onecould argue that jumping into B2C was not a good idea due to complex procedures but at the sametime it is the business where the volumes are. Now we can say that this was an excellent decisionas we managed to achieve profitable growth. This was thanks to such innovations as the Predictservice developed by DPD UK.”
“In France, Chronopost and Pickup have developed a parcel shop network, currently present, apartfrom France, in Germany, Benelux and Portugal, with the UK, Spain and Poland and other Europeancountries to be added soon to complete our network.”
“What we now offer to the customer is no longer just transit times but value added services. Wenotify the recipient the day before about the time slot during which the delivery will be made, wearrange the returns etc,” Emery said.
Addressing European journalists at GeoPost’s head office, Emery pointed out: “GeoPost nowgenerates nearly a third of our European parcel volumes from B2C. DPD UK is the leader in terms ofB2C volumes for parcels with a weight below 30 kg.”
“For two years now, we have been focusing on the development and creation of added value interms of our intra-European parcel flows. Building up on our strong position in the domesticmarket, we can now expand on it strengthening our presence in Europe on a cross-border level thanksto our distribution network.”
Meanwhile, GeoPost generates 10% of its total volumes from international operations, with 95% ofthose being generated within Europe. In concrete terms this means that 10 out of 100 parcelsdelivered by GeoPost every day are cross-border, Emery explained. In revenue terms, internationalparcels account for 20% of the company’s revenues.
He highlighted value-added services for customers such as the Predict notification service,informing them in advance about the delivery time slot, which will be reduced to one hour nearlyall over Europe by the end of the year. “We also continue building up our European networks ofparcel shops in cooperation with local retailers and automated parcel terminals.”
When asked about the synergies between ChronoPost and Exapaq, Emery stressed that they operatein two completely different markets using separate transport networks. “As a French expressoperator, Chronopost focuses on next-day deliveries before 9 or 10 am or 1 pm with air transportproviding guarantees, insurance etc. In contrast, Exapaq operates in a different market (notexpress) without guaranteed delivery times, serving another type of customers who are rather smalland medium-sized regional enterprises (SMEs). Chronopost takes care of big national key accounts,e.g. Canal Plus, SFR. We would never think of combining the two networks.”
Chronopost France operates 80 sites, including six hubs, with over 102 million parcels deliveredin 2013. Exapaq also counts six hubs and 55 agencies, with more than 55 million deliveries madelast year.
Looking ahead, Emery said that the aim is to maintain the company’s “exceptional” growth by theend of the year while continuing to launch innovative services to cope with the competition.
The company said it is pursuing its strategy, focused both on developing its B2B and B2Cactivities, with the aim to become number one in Europe. “GeoPost will make acquisitions wheneverthey make sense, either in terms of geographic footprint or in terms of useful additions toexisting business activities. In terms of organic growth, the aim is to increase market share byrelying on the efficiency of our network and the quality of our services.”
As an express parcel specialist, GeoPost ranks number one in France and number two in Europe(behind Deutsche Post DHL) with consolidated turnover of €4.4 billion in 2013. The companytransports 814 million parcels per year worldwide and operates 830 hubs and depots with a fleet of26,000 vehicles covering 230 countries and territories. 22,000 staff from 40 different nations areemployed at the company serving 310,000 customers.
The European market is estimated at €42.8 billion for all parcel categories combined, and at€32.8 billion excluding postal parcels. It has increased by 5.7% in value terms compared with 2011.The market remains highly concentrated with Germany, the UK and France accounting for over 53%.Including Spain and Italy, these five countries account for 70% of the market. B2B continues toaccount for 70% of the market with €28.7 billion, in relation to B2C with €14.1 billion, accordingto GeoPost figures.
GeoPost sees itself second on the European express parcels market, with a market share of 10%,behind DHL with 12%. TNT and UPS rank third and fourth with shares of 9% and 8% respectively,followed by GLS (4%) and FedEx (2%). The remaining 55% of the shares are held by postal operators(23%) and other companies (32%), GeoPost said.
