Deutsche Post looks to grow on its UK success
The world’s largest logistics group is looking to grow its business with retail customers outside the UK and luxury goods groups, according to its head.
John Allan, the head of Deutsche Post’s logistics division and the former chief executive of Exel, the UK company taken over by the German postal giant, said such opportunities should lead the unit to faster growth than the 5-6 per cent he forecasted for the industry as a whole.
The logistics industry is benefiting from the continued strength of world trade and the relocation of manufacturing from western countries to low-cost nations.
The trend towards outsourcing has led to the creation of so-called contract logistics, where companies such as Deutsche Post look after groups’ entire supply chains. Deustche Post is the leader in this area after the 3.8bn GBP (7bn USD) Exel takeover, which brought with it customers such as carmaker DaimlerChrysler and retailer Marks and Spencer.
“Can we replicate the success of our retail business in the UK in other markets around the globe?” asked Mr Allan, giving his first interview since joining Deutsche Post’s management board six months ago. “We have a very strong position in fast-moving consumer goods. We have a much lower share of luxury goods: there is a lot more potential.”
Integration of Exel and DHL’s logistics businesses started earlier this year and is progressing according to plan with completion set for 12 months’ time, he said.
Despite the importance of global trade for logistics businesses, Mr Allan said failure of the Doha round of talks to open up markets would not bring problems.
“Our business, our industry has benefited without getting to the end result of world trade,” he said, adding that “on a personal basis” he hoped the World Trade Organisation talks would succeed in helping developing countries.
Mr Allan also dismissed fears that signs of protectionism among some western countries, such as the US or France, would have a practical impact on business.
“The beauty of our business is if a company decides they don’t want to source from country A they have to do it from country B instead – and we should be in both.”
