DHL Supply Chain
DHL Supply Chain is a division of Deutsche Post DHL and is affiliated with DHL. Headquartered in Bonn, Deutsche Post has 510,000 employees.[3]
Company type
Logistics
Adrian Dalsey
Larry Hillblom
Robert Lynn
Bonn, Germany
Oscar de Bok, CEO[1]
Jim Monkmeyer, President
€14 billion (2016)[2]
600,000
In 2016, DHL Supply Chain was primarily competing in strategic life sciences and healthcare, automotive and technology sectors of the market. The automotive sector, with its Lead Logistics Provider (LLP) service, has been shifting to China, India and Mexico as those countries become significant vehicle and parts manufacturers.[4] In Canadian and USA markets DHL Supply Chain operated under the name Exel until January 2016.
In 2016, the DHL Supply Chain division's revenue decreased by 11.6% to €14.0 billion versus 2015, but operating profit improved by 27.4% to €572 million.[2]
Mergers and acquisitions[edit]
The acquisition of the Swiss logistics provider Danzas and the largest American service provider in the field of international airfreight, Air Express International (AEI), by Deutsche Post, happened in 1999. Founded in 1815, the prestigious Danzas group was regarded as one of the world's leading logistics companies. With approximately 29,000 employees at the time of acquisition, Danzas had a strong logistics network on all continents.[7]
The acquisition of AEI was similar. AEI had a network of branches in 135 countries. In addition to integrated logistics and multi-modal transport, it was offering warehousing, distribution, customs processing and IT-based logistics services. AEI was integrated into the Intercontinental division of Danzas. As a full-service provider, the merged companies provided Deutsche Post with a dense transport network as well as an impressive portfolio of value-added services.[7]
The partnership with DHL International, which began with the acquisition of a minority interest in 1998, was expanded and intensified in 2000. Negotiations were then concluded, allowing Deutsche Post to establish a majority interest from 1 January 2002. In July 2002, Deutsche Post acquired a 25-percent share in DHL from Lufthansa Cargo and increased its majority stake to 75 percent.[7]
At the time, DHL Worldwide Express had more than 71,000 employees worldwide. A pioneer in global express shipping, DHL's international network linked over 220 countries and territories. DHL became a wholly owned subsidiary of the Group in December 2002 after Deutsche Post acquired the remaining shares from two investment funds and Japan Airlines.[7]
In December 2005, Deutsche Post acquired the British logistics company Exel for 5.5 billion euros. At that time, approximately 111,000 employees worked for Exel in 135 countries.[7] The company concluded the first half of 2005 with a 55 percent leap in profits to 172 million pounds (251 million euros).[7]
In 2006 Deutsche Post took a majority stake in Williams Lea, a business process outsourcing (BPO) provider specializing in document management and mail services.[8]
In July 2011, DHL acquired Tag Worldwide, an international provider of marketing execution and production services.[9]
In 2017, DHL sold the combined Williams Lea Tag business to Advent International.[10]
In May 2018, DHL Supply Chain strengthened its presence in Latin America by acquiring Colombian logistics company Suppla Group. At the time of the acquisition, Suppla employed over 4,500 employees in 25 cities of Colombia.[11]
Products[edit]
In the Supply Chain business, DHL Supply Chain provides customers in many industry sectors with logistics services along the entire supply chain – from planning, sourcing, production, storage and delivery to returns logistics and value-added services – in order to ensure logistics flow.[16]
DHL Supply Chain offers warehousing, distribution, managed transport and value-added services as well as business process outsourcing, supply chain management and consulting. DHL Supply Chain's goal is to ensure that their customers' products and information reach their markets quickly and efficiently, thus securing them competitive advantages.[16]
Some of the key DHL Supply Chain products include: Lead Logistics Provider, Packaging Services, Integrated Logistics Procurement, Technical Services, Service Parts Logistics, e-Fulfillment, Airline Business.[16]
Market position[edit]
DHL Supply Chain was the global market leader in contract logistics with a market share of 8.3% (2010). In this highly fragmented market, the top ten players account for only about 23% of the overall market, the size of which is estimated to be €147 billion. DHL Supply Chain is the regional market leader in the regions of North America, Europe and Asia Pacific and also has a very strong position in rapidly growing markets such as Brazil, India, China and Mexico.
Financial results[edit]
DHL Supply Chain, as the contract logistics business of Deutsche Post DHL, generated profitable growth in year 2011. Revenues and earnings were well above the previous year's level. The division reported a revenue increase of 1.2 percent to EUR 13.2 billion (2010: EUR 13.1 billion). As a result of portfolio adjustments made during 2011 – such as the divestment of a subsidiary in the United States that was not part of the division's core business – this result only partially reflects the division's operating performance. Adjusted for these consolidation and exchange-rate effects, SUPPLY CHAIN's revenues rose by nearly 6 percent, or more than EUR 700 million, in 2011.[17]
This increase was fueled in particular by strong growth in the Asia-Pacific region as well as in the Life Sciences & Healthcare and Automotive sectors. Additional contracts worth EUR 1.3 billion were concluded in 2011, an increase of around EUR 200 million versus the previous year. Combined with additional operating improvements and strict cost management, increased business activity drove up the division's earnings in 2011. At EUR 362 million, the operating earnings were 56.7 percent above the previous year's level of EUR 231 million.