Martin Kreiter, Head of Global E-Commerce Business Development at Hermes and Director of BorderGuru, talks to Post&Parcel about cross border e-commerce.
Hermes is now expanding its digital services by offering retailers global integrated logistics and e-commerce solutions.
At the heart of this drive is the Hermes BorderGuru service which, according to Kreiter, gives retailers the opportunity to “roll out their business models beyond country borders and tap new sales markets”.
For most SMEs, said Kreiter, the main hurdles to cross-border e-commerce are a need for more “know-how” about issues like customs payment and handling, and also the lack of transparency regarding costs and the shipping process.
BorderGuru solves these problems, explained Kreiter, by “providing full transparency including fully landed cost through the real time calculation of shipping, duties and taxes”. Importantly, the retailer decides if these are displayed to their end customers in the webshop checkout process. This puts the retailers firmly in charge of the information flow and also minimizes their entrepreneurial risk.
Kreiter emphasized that BorderGuru also provides “very competitive” lane pricing because, instead of relying on the “full service packages” offered by the big integrators in the market, it “customs builds” its logistics lanes by “carefully picking the best fitting service partners along the value chain” – from the first to the last mile, including air freight handling and import and export processing.
“As a member of the Hermes Group, BorderGuru can draw upon a wide range of services,” said Kreiter, “and we can give retailers access to key e-commerce platforms.” This embraces the full length of services along the retailer’s supply chain: sourcing, quality assurance, transport, fulfilment, two-man handling and delivery services – including a very successful parcel unit in the UK, too. “Furthermore, we can give retailers access to key e-commerce platforms, ” added Kreiter.
Earlier this month, Hermes announced that BorderGuru has become an official contractual partner of China’s Alibaba Group. This means that it is now working closely with one of the biggest e-commerce marketplaces – TMall – and Alibaba’s affiliated logistics platform, Cainiao.
As part of the collaboration with Cainiao, BorderGuru is providing the IT-assisted management of the whole logistics chain between Europe and China – from the pick up at the retailer’s warehouse in Europe through to the transfer to the ‘last mile’ in China.
Kreiter explained why this deal was so import for Hermes, and its clients: “With a market share of more than 50%, TMall is by far the market leader in Chinese e-commerce – and thus in the world.
“TMall Global is the platform that attracts brands and retailers from abroad to sell to Chinese consumers who have a strong and growing demand for ‘made in Europe’ and ‘made in USA’.
“Having a contractual partnership with Cainiao to handle the logistics from Europe to China and having a close and trustful partnership in addressing the European landscape of brands and retailers, provides a win-win situation and a substantial business opportunity for Hermes/BorderGuru.”
Looking to the future, Kreiter said the plan is to “further develop the targeted major international lanes” and cooperate with “strong international business partners” who offer services, such as payment handling, which could benefit from having BorderGuru as a logistics service provider.
“Hermes already has a strong base in Europe,” concluded Kreiter, “and now BorderGuru makes the Hermes Group a real international company – which supports all our customers who are also looking to expand their cross border business.”