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More consolidation ahead in Korean CEP sector

Posted by | May 20, 2008 | |

The South Korean domestic express delivery market is heading for more consolidation after a series of deals over the last year, according to experts. Large conglomerates are entering the market, resulting in tougher competition and falling profits for medium-sized players.

Although the four largest parcel carriers are estimated to have 60% of the market, there are still a large number of smaller players. However, recent moves by industrial conglomerates to enter the market have intensified competition, the Korea Times newspaper reported recently.

The Big Four are Korea Express, Hyundai Express, Hanjin Express and CJ GLS. Korea Express regained leadership of the domestic express parcel market from Hyundai Express in 2007, closely followed by the other two major players.

The biggest transaction in the market recently was the acquisition of Korea Express by the Kumho-Asiana group. Hyundai Express is part of Hyundai Logistics, the logistics division of the international automotive group, while Hanjin Express is part of the Hanjin Group, owner of Korean Air and the Hanjin container shipping company.

The common factor is that the large Korean conglomerates see the parcel sector as a growth market, especially for home deliveries of consumer products bought via the internet or TV, while they also believe they can reduce their internal logistics costs by owning a delivery company.

One consequence is that market players are reducing prices to try to keep or grow their volumes, leading to lower profits. This, in turn, is creating more potential for market consolidation.

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World Mail Awards 2008 winners announced

Posted by | May 20, 2008 | |

The 2008 World Mail Awards winners were announced yesterday, 19th May, in Budapest, Hungary at a prestigious black tie gala dinner in front of an audience of over 300 senior executives from around the globe. The evening was a fantastic start to the World Mail and Express Europe Conference taking place 20th and 21st May, whilst it offered delegates a prime opportunity to network and celebrate best practices in the industry.
With over 100 entries received this year and an impressive shortlist issued four weeks ago, judges had a tough job on their hands. The independent panel of judges met in Budapest hours before the ceremony to determine the 2008 winners with Hungarian celebrity and television presenter Zsuzsanna Demcsák, presenting the awards in the following categories:

*Corporate Social Responsibility – Sponsored by DHL Global Mail – Royal Mail Group for its Carbon Management Programme
*Customer Service – Sponsored by Western Union – Canada Post for its PERMANENT Stamp
*e-Commerce Sponsored by Saudi Post – Post Danmark for its ecommunication
*Growth – Sponsored by Qatar Post – Australia Post for its Promotional Mail Market Growth Challenge 07
*Industry Leadership – Sponsored by Pitney Bowes – Ulrich Gygi, Chief Executive Officer, Swiss Post
*Innovation – Sponsored by Emirates Post – Post Danmark for its No More application
*People Management – Sponsored by Australia Post – Correos for its The New Technologies & Training Alliance as a change driver at Correos
*Quality – Sponsored by Magyar Post – Post Danmark for its Media Portfolio – Quality in serving every customer needs
*Retail Project – Sponsored by ME News – PayShop (Portugal) S.A. for its PayShop – the most convenient way to pay your bills!
*Security – Sponsored by Royal Mail – Magyar Posta for its Delivery worker protection programme – A security solution by Magyar Posta
*Technology – Sponsored by Intermec – 21 Grams for its iSort application
*Transformation – Sponsored by Triangle – New Zealand Post for its Retail Transformation.

Congratulations to all winners and shortlisted entries and a big thanks to all our sponsors. Triangle Management Services is also proud to announce that next year’s World Mail Awards and the World Mail and Express Europe Conference, will be held in Munich, Germany on 6th – 8th May. If you would like to apply for one or more of the 2009 Award categories, applications will open in January next year!

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DHL to go beyond traditional approach and focus on customer needs

Posted by | May 20, 2008 | |

Going beyond the traditional approach of providing only back office support, DHL Exel Supply Chain’s IT department specifically focuses on customer needs, according to Mark Wettasinghe, CIO of DHL Exel Supply Chain, Asia Pacific.

Wettasinghe highlighted that IT personnel should understand business situations and translate them into opportunities for technology to play a supporting or enabling role.

To align the IT function with business strategy worldwide, DHL’s parent company DPWN sets policies for local IT departments including organisation, role definitions, performance assessment and recruitment.

He expects the department to further evolve into a business unit by itself, providing IT services to anybody within or outside DHL.

DHL also has to deliver pharmaceutical products with temperature tolerance levels within a set time limit. To meet this challenge, the company uses Radio Frequency Identification (RFID) tags with temperature sensors.

The company leverages on pick-to-light technology to minimise turnaround time from customer order to actual delivery. A pick-to-light system uses lights to guide the employee to exact warehouse locations where ordered items are to be picked up. “It’s like GPS, which can help you find the shortest or fastest route to town,” said Wettasinghe.

Wettasinghe makes customers’ requests for customisable services as business cases before top management. “I always tell the boss that if the customer is willing to pay, wouldn’t it be worthwhile that for every dollar DHL puts in, the company gets back two dollars in return?”

However, he pointed out that when it comes to providing services internally such as for ERP, finance or HR systems, associated IT costs “have to come down”.

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Ulrich Gygi wins the Industry Leadership Award at the 2008 World Mail Awards

Posted by | May 20, 2008 | |

Dr. Ulrich Gygi, CEO of Swiss Post, was honored with the Industry Leadership Award at the 2008 World Mail Awards in Budapest. The award, which is sponsored by Pitney Bowes, was presented to Dr. Gygi by Patrick Keddy, President Pitney Bowes International.

CEO of Pitney Bowes, Murray Martin said: “We’ve been involved in the World Mail Awards since its inception and are very pleased to sponsor the Industry Leadership Award. This award recognizes individuals who have contributed to the success of our industry and helped shape the future of global postal systems.”

The Judging Panel said it recognized Dr. Gygi for his leadership and steady transformation of Swiss Post into a more efficient and cost-effective entity. “In addition to domestic operational and financial success, Dr. Gygi has also demonstrated creativity and initiative by forming strategic partnerships in international markets,” said David Treworgy, the non-voting chair of the judging panel.

The winner was selected through an independent Judging Panel consisting of seven distinguished individuals in the postal and mail industry:
Jean-Paul Bailly, CEO of La Poste and 2007 award winner
Helge Israelsen, CEO of Post Danmark and a previous award winner
Graeme John, Managing Director of Australia Post and a previous award winner
John E Potter, Postmaster General and CEO if the United States Postal Service, and a previous award winner
William Tan, former CEO of Singapore Post
Elmar Toime, former CEO of New Zealand Post and a previous award winner
Dr. Klaus Zumwinkel, former Chairman of Deutsche Post World Net and a previous award winner

Pitney Bowes will also make a charitable donation or provide funding for an educational initiative of Dr. Gygi’s designation

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TNT invites unions to restart wage talks

Posted by | May 20, 2008 | |

TNT NV said on Tuesday it would invite unions to restart wage talks in a bid to avert a countrywide strike next week.

“We have listened carefully to our employees and see room for negotiations,” a TNT spokesman said, adding that if the unions accept the invitation, talks would start on Friday.

TNT workers are demanding a 3.5 percent wage rise retroactive to April 1 for a one-year period.

TNT has offered a 1.5 percent increase retroactive to April 1 and another 1.5 percent rise on Jan. 1, 2009, conditional on changing employment conditions.

TNT argued its workers are already paid 20 to 25 percent more than market rates. It had originally sought a pay freeze, in a bid to cut costs and compete better with rivals.

TNT is targeting cost savings of 395 million euros (USD 615 million) between 2007 and 2015.

The unions have been holding rolling industrial action in different parts of the country, that will culminate in a countrywide strike planned for May 27 to back their demands.

The company, which is expected to lose its monopoly in the domestic market, has said that without changes to employment terms, it may have to cut up to 11,000 jobs from its Dutch workforce of 59,000.

The government said on Friday it would postpone the opening of the Dutch mail market due to uncertainties over a level playing field in Germany and labour conditions at home.

TNT has steadily lost market share to rivals Sandd and Deutsche Post’s Selekt Mail.

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Siemens wins USD 245 million order from USPS for 550 Mail Sorting Systems

Posted by | May 20, 2008 | |

Siemens announced today that it has been awarded a USD 245 million contract from the United States Postal Service (USPS) for 550 Advanced Facer Canceller Systems (AFCS) 200 to replace and modernize its existing fleet of AFCS. The AFCS currently being used has been in service for almost 20 years and is used by the Postal Service (TM) to cancel First-Class mail.

In addition to the design, build and installation of the replacement machines, the contract includes the delivery of ancillary equipment, spare parts, training and complete integrated logistics support services. Siemens and USPS engineers worked together to develop a system that integrated all the technical requirements of the USPS with the state-of-the-art developments in mail processing technology.

The AFCS 200 will use the Siemens Advanced Color Reader (ACR) to detect and lift the address and other mail piece information for automatic reading. The ACR’s greater capabilities will not only enable greater reading performance but also streamline the overall system design.

This will be the first system in the USPS fleet to use Siemens’ channel gate technology. The channel gate improves on traditional diverters by actually modifying the path of the letter through the machine rather than deflecting it in a particular direction. The new technology greatly increases the throughput of the machine and will be a major contributor to the cost savings the USPS anticipates in the deployment of the AFCS 200.

Production and installation of the AFCS 200 order is expected to be completed by March, 2011.

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Nippon Express Denies Abolition of "Pelican" Parcel Service

Posted by | May 20, 2008 | |

Nippon Express Co. denied a news report that its “Pelican”-brand parcel delivery service will be abolished when the company and Japan Post Service Co. integrate their door-to-door package delivery operations in April 2009.

The major Japanese daily Asahi reported in its Monday morning edition that the 30-year-old Pelican brand will be scrapped as Nippon Express and Japan Post Service are set to use the latter’s “You-pack” brand for their joint parcel delivery operations.

Nippon Express and Japan Post Service, a postal service unit of Japan Post Holdings Co., will set up a fifty-fifty joint firm, named JP Express, in June this year to prepare for the integration.

Given that Japan Post Service will later take majority control of JP Express, there is still a possibility of the Pelican brand being scrapped for integration into the You-pack brand.

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