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APC Overnight expands Bellshill hub operation

Posted by | Aug 26, 2008 | |

Independent parcel carrier APC Overnight has expanded its Bellshill hub operation in Scotland in a bid to reduce fuel consumption, improve delivery times and cut its environmental impact. APC, which has more than 170 delivery vehicles in its fleet and runs 125 depots across the country, is now using the site to retain all its consignments for Scottish destinations within Scotland.

At Bellshill a third of all parcels received are sorted and distributed in Scotland without ever crossing the border, enabling earlier deliveries. APC says that as a result it is able to manage drivers’ working time better.

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City Link is not cutting wage bill

Posted by | Aug 26, 2008 | |

City Link has come out fighting against suggestions that it has been trying to cut its wage bill by around GBP 4m to remain profitable. Sources in the industry contacted CM to say some staff at the firm had taken a wage cut and others had been made redundant following the company’s merger with Target Express last year.

However, City Link sales and marketing director Stuart Godman insists the company has not cut its wage bill, and has only made a few redundancies following the merger with Target.

“I can categorically deny the suggestion that anyone has been asked to take a pay cut in our business,” he says.

“In fact, we are continuing to invest in the business, and will open a number of new depots over the coming months. New depots will open at Worcester, Norwich, Coventry and Stoke by October, and the Cwmbran depot will be refurbished and the Oxford depot extended.”

Godman adds: “In any situation where companies come together, which in our case is the Target Express and City Link brands, it is inevitable that there will be duplication of roles, which result in sporadic redundancies as well as the need in certain regions to either consolidate or relocate depot locations.”

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Toll underlying profits rise despite overall loss from Virgin sale

Posted by | Aug 26, 2008 | |

Toll Holdings announced a heavy full-year loss due to selling off its 63 pct stake in airline Virgin Blue but unveiled a strong rise in underlying profits.

In the year ending June 30, 2008, the group, which includes major express, parcel and courier businesses, made an overall net loss of AUD 695 million (EUR405 million). But this included a loss of AUD 952 million on discontinued operations, including a heavy AUD 1.2 billion writedown on the value of the Virgin Blue stake.

Toll announced in July that it would dispose of its holding in Virgin Blue by paying its shareholders a special dividend in the form of Virgin Blue shares. The group had previously said that the passenger airline was not a core business and that it wanted to focus on its global logistics activities while using the airline’s freight capacity under a long-term commercial agreement.

Net profits from continuing operations rose by 24pct to AUD258 million (EUR 150 million) on revenues up by 15.4pct to AUD5, 605 million (EUR 3,270 million). The operating profit (Ebit) was up by 18pct to AUD429 million (EUR 250 million). Toll managing director Paul Little commented: “We are pleased with the performance of our core operations, the integration of several new acquisitions and our balance sheet strength, which will all support our ongoing strategic development.”

In Australia, revenues grew to AUD4.42 billion thanks to 7.5pct organic growth and various acquisitions, including several express companies (Victorian Express, Couriers Australia and SkyNet). Operating profits were up 18pct at AUD347 million. The express operations, Toll noted, represent about 35pct of divisional revenue of AUD4.6 billion, or approximately AUD1.6 billion.

Toll IPEC, the road parcel express business, performed strongly during the year, benefiting from integrating services with group warehousing and distribution operations and utilising its comprehensive network to grow market share.

Looking ahead, Toll said that there is no deterioration in the Australian market yet, notwithstanding a number of challenging factors including increased interest rates, high fuel prices and currency volatility. In particular, it expected to benefit from more Australian companies looking to source directly from Asia.

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Co-op to give 250 biggest food stores a taste of mini-banks

Posted by | Aug 26, 2008 | |

The Co-operative is to put banking operations inside its convenience stores to encourage customers to use more services within the sprawling mutual group.
The move follows similar strategies by Tesco, Marks & Spencer and J Sainsbury. It marks a new campaign by the Co-op to compete with mainstream competition by pushing its ethical message.
The Co-op began trials six weeks ago in stores in Nottingham, Brighton and Hove. Of its 2,200 food stores, it believes it could open mini-banks in the 250 biggest.
The Co-op is investing £1m in the project, part of its strategy to double market share in financial services over five years. David Anderson, chief executive of Co-operative Financial Services since June 2005, said there was a “huge opportunity” as “there is very little cross-holding between products”.
On average customers have 1.3 financial products. “We think we can push that to over two, which would mean we can almost double our customer base without finding any new customers.”
More on financial services
The Co-op is also aiming to boost cross-selling between the group, which includes pharmacy, funeral arrangement, travel and legal advice services. The organisation has three million members, and a third of those have no Co-op financial services products.
The roll-out will vary from some stores where there is a machine to withdraw cash and deposit cheques to others where there will be staff to advise on products including mortgages and investments.
Having more banking branches should support the Co-op’s phone and internet bank, Smile, as customers like to have the option of a physical branch even if they carry out most banking transactions electronically, Mr Anderson said.
The Co-op also believes it has a competitive advantage because of its ethical investment credentials. “One-third of our profits are from customers who say they joined for our ethical policy,” he said.

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Yurtiçi Kargo – GeoPost partnership becomes a regional force

Posted by | Aug 26, 2008 | |

Yurtiçi Kargo, through its partnership established in 2003 with GeoPost, Europe’s continues investments in Russia, CIS and Balkan countries.

The GeoPost – Yurtiçi Kargo partnership was established in 2003, and it enabled customers to send parcels to 230 destinations around the world. In the following year, the partnership has started organic growth across the neighboring region as it acquired companies in some countries, while establishing local partnerships through acquisition of major shares in others. The largest of the latter is Armadillo, a local and international parcel and logistics company in Russia. Further, GeoPost and Yurtiçi Kargo continued their growth within the CIS, starting with UVK the largest company in Ukraine. Meanwhile, in Kazakhstan, GeoPost and Yurtiçi Kargo have established a growing business without any local partner.

In March 2008, Yurtiçi Kargo and GeoPost have entered the Romanian market by acquiring the majority of shareholding of Pegasus, one of the most successful Courier and Express Parcel companies in this country through their partnership. Also, the partnership has started providing services in Bulgaria.

The GeoPost – Yurtiçi Kargo partnership has increased its incomes by 35 pct in the first half of 2008, as of end of June 2008; delivering around 25 000 parcels daily in Russia, Romania, Ukraine, Bulgaria and Kazakhstan.

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Hermes Logistik introduces diesel surcharge

Posted by | Aug 26, 2008 | |

Hermes Logistik has introduced a diesel surcharge in response to the sharp rise in fuel costs in recent months.

As of August 18, the company is imposing a surcharge of EUR 0.20 for all domestic parcels and of EUR 0.40 for all parcels sent to European destinations. The surcharge is shown separately on all invoices.

Hermes said in a notice on its website that it had decided to follow competitors by introducing a surcharge since it could no longer absorb the higher fuel costs despite “many savings measures and the use of modern vehicles”.

German newspaper Handelsblatt reported that with the surcharge Hermes was now more expensive that DHL for consumer parcels. The cheapest Hermes parcel, including the surcharge, now costs EUR 4.10 while DHL charges EUR 3.90. A DHL spokesman told the newspaper that the German parcel market leader has no plans to introduce a diesel surcharge.

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The Delivery of EMS Speeds up in China South-west

Posted by | Aug 26, 2008 | |

From August 14, 2008, China Post EMS started two types of premium time-certain services – EMS Next-morning Delivery and Next-day Delivery between Chongqing and other key cities in the south-west region. Currently, the time-certain delivery services include: two-way Next-morning Delivery between Chongqing and Chengdu / Kunming, two-way Next-day Delivery between Chongqing and Guiyang / Qujing / Chuxiong / Gejiu / Dali, and single-way Next-day Delivery from Zunyi to Chongqing . The two services will adopt the same rate of normal EMS : RMB 20 for the first 500 grams and RMB 6 for any additional 500 grams.

With the ongoing network optimization in the south-west, the EMS Next-morning Delivery and Next-day Delivery will be expanded to more cities in the region to meet the market demand for quality express services. For the time being, Chongqing EMS branch is planning to open the EMS truck route by use of the freeway between Chongqing and Guizhou Province , which will further reduce the time of transportation and delivery of EMS items along this route.

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Chinese courier companies face FedEx threat

Posted by | Aug 26, 2008 | |

China’s express delivery market has been undergoing unprecedented change since FedEx began reducing its prices early this year.

The price reduction is a clear sign that FedEx is seeking to enlarge its share of China’s domestic express delivery market, which has seen growth rates rise by 30 percent this year with the increase in e-business and online shopping in the country.

Such low prices will take clients away from local express companies, and worsen what has already been a tough situation for them this year, the report said. In 2008, most domestic private-owned express companies have been reporting deficits due to the rising prices of fuel and labor. Some have even been forced to close.

FedEx applied the same strategy in countries such as Mexico and Egypt and successfully drove local express companies out of business. But after it took control of the market, FedEx raised prices back to their previous levels. Now China is facing the same threat, the article says.

But the local companies are fighting back, and they believe there is a considerable market space that international express giants cannot take away. For instance, they still provide cheaper services for shipments within a radius of 500 kilometers, and as long as they survive the current hard times, they will reclaim their share of the market – mainly in short-distance shipments with small business clients, Qianjiang Evening News reported in July.

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