Hermes wins German market share and targets Austria
Hermes Logistik, the German consumer parcels company, today announced double-digit growth, a surge in the number of parcels sent by consumers, and its entry into the Austrian market this summer.
The operator, a subsidiary of Europe’s largest mail-order company, Otto Group, increased gross sales in the business year ending February 28, 2007, by 11.5% to EUR 1,016 million, with net sales up to EUR 872 million. It does not disclose profit figures.
Volumes in the business-to-consume (B2C) segment grew by 10.3% to 235 million shipments, increasing its German B2C market share to 37% from 35%, it said in a statement. The ProfiPaketService for medium-sized firms launched in February 2006 generated 3,000 new customers its first year.
The fastest-growing business, however, was the consumer-to-consumer (C2C) parcel business. “ We are particularly proud of massive growth in private parcels,” said managing director Hanjo Schneider “With an increase of 79% to 23.6 million items we have substantially reduced the gap on the current market leader.”
The main success factor was the network extension to over 13,000 outlets, meaning Hermes was close to the customer, he added. The company has no plans for any automated parcel machines, he said, referring to DHL’s trial of such machines.
Hermes also confirmed plans to enter the Austrian market this summer under its strategy of creating a European B2C delivery network. It will launch services on July 1. By end-2007, the company aims to have five distribution centres, 35 branches and about 1,000 PaketShops in operation.
“The Austrian market is characterised by a de facto monopoly,” explained Schneider. “The competitors already active in the market concentrate on delivering to business customers, i.e. the B2B market. There is no real competitor yet for deliveries to private consumers.” Hermes put Austrian Post’s market share at over 90%.
“Experience in Germany has shown that competition is welcomed equally by shippers and customers. Both groups profit from more service, a stronger customer focus and, not least, from falling prices. Our aim is to deliver at least 20% of Austrian B2C and C2C shipments through our system in 2008.”
German media recently reported that Hermes would initially transport the Austrian parcels of Otto Austria and another Otto-owned company Universal, which could amount to some 10 million parcels a year or about 25% of the country’s total B2C parcel market.
Hermes Logistik is also believed to be looking at entering other European B2C parcel markets such as Spain and Italy. It is already present in Britain and France through local distribution subsidiaries of the Otto Group.
