German couriers and delivery company GO! Express has announced that it has expanded its one day delivery network in the Czech Republic.
The company has released a statement that says, “With the opening of a further five locations, additional significant business centres will be served overnight. Another milestone in 2016 will be the establishment of the GO! brand in Slovakia.”
GO! Express will now be offering one-day transit times in the metropolitan areas of Olomouc, Ostrava, Hradec Králové, Pardubice and České Budějovice, alongside its existing operations in Praha (Prague) and Plzeň (Pilsen).
GO! Express added: “The expansion of services in the Czech Republic will play a decisive role in our network enlargement: the Czech Republic has been a GO! system partner since 2002, and belongs to the group of shareholder Wolfgang Sacher, GO! Berlin. Twenty-seven employees and more than 30 couriers ensure timely delivery of the highest quality.
“Under the leadership of coshareholder and managing director Martin Koča, GO! Czech Republic processed a total of 58,000 deliveries in 2015, thus achieving volume growth of 35% year on year. This significant increase was primarily achieved in exports.”
The German courier and delivery company has been operating since 1984, yet has been experiencing rapid growth in part due to the advent of e-commerce. It has moved its interests east to the Czech Republic and soon, Slovakia as part of plans to exploit the growth of e-commerce in those two countries. The new members of the EU are seen as fast emerging markets that could yield better returns than more mature markets such as Go!’s home country, France or the UK.
USPS has been undercharging its competitors for last mile deliveries in rural areas, and this apparently is one of the major factors in its eye watering annual losses that it reported recently according to US Sen Claire McCaskill. She suggested that the US postal operator “may be losing money by under-charging competitors such as UPS and Fedex to carry mail to those areas”.
The Senator is a senior member of the Senate Homeland Security and Governmental Affairs Committee, that has jurisdiction over the USPS.
In a statement issued on Thursday (21 April), Senator McCaskill, “We are giving a really good deal to our competitors. I’ve never seen another business entity who says, because we are so starving for volume, we’re going to take the most expensive part of our architecture, which is the last mile, and we’re going to give our competitors a deal on that last mile.
“And I have yet to have anyone give me the analysis that shows me that they have, in fact, at the Postal Service, considered what price they’re giving to UPS and FedEx for that last mile of delivery as it relates to our costs.”
She recently backed the Rural Postal Act, a bill sponsored by Senator Heidi Heitkamp of North Dakota that would restore overnight delivery, return a faster First-Class mail standard, make six-day delivery permanent, and enact strict criteria the Postal Service would have to meet before closing a post office.
As a general rule people who go into the civil service operations such as the USPS have not always come from big business, and as such decisions made by bureaucracies such as the postal operator are not those that would have been made by their business competitors…
Perishable goods will soon be carried by Belgian delivery company Bubble Post’s new fleet of motorcycles. It unveiled the new electric bikes that feature an “actively cooled cargo space” for transporting perishable items.
Bubble Post sells its green credentials as part of its marketing. It was established in Ghent in 2013 and now operates in “all the major cities in Flanders”, and sells itself as a provider of “efficient and sustainable city deliveries”.
Bubble Post has an out of town warehouse just outside every city that it operates. Goods are delivered there by the company’s fleet of HGVs. The packages are sorted and bundles before being put aboard the company’s fleet of eco-friendly bikes, trikes, electric vans and CNG powered Sprinter vans that make the last mile journey into the city centre.
Until now, Bubble Post has had to use its CNG powered vans to deliver the goods, which have refrigerated units on board. The new cool cargo bikes can fulfil this requirement and reduce its carbon emissions still further as a result.
The company is already operating one cool cargo bike in Amsterdam, and has ordered another 20 bikes that will come into operation in the next 2-3 months. These are in addition to the 60 standard cargo bikes in its fleet at present.
With the very obvious increase in numbers of delivery vehicles in major cities across Europe as a result of e-commerce, a number of city governments are looking at pollution from such deliveries. Having a green alternative in the form of low or zero emissions vehicles will help deflect any direct action on the part of such authorities.
TNT, which is soon to be merged with FedEx, has reported revenues of €1.59bn and an operating loss of €1 million in the first quarter (Q1) of 2016. According to the company, both revenue and income were “negatively influenced by fewer working days”.
The revenues are down from €1.622bn in Q1 of 2015 but TNT said in a statement that “underlying revenue growth, adjusted for currency effects, lower fuel surcharges and working-day effect, was 4.2%”.
The loss in question was €10 million better than in 2015. The result included one off charges of €10 million of which €4 million was related to the offer made by FedEx. Excluding one off charges, the adjusted operating income was €9 million, up €8 million against Q1 of 2015.
The company’s net cash position is €145 million compared to €330 million in 2015.
Speaking about the results, Tex Gunning, TNT’s Chief Executive Officer, said: “In the first quarter, TNT again delivered solid underlying revenue growth. Adjusted operating income improved despite fewer working days and continued investments in the Outlook strategy. The Outlook strategy is on track and delivers good growth from SME customers. Our customer satisfaction scores hit new records in Q1.
“Investments in operational excellence have started to pay off and were €51m during the quarter. We made good progress with the roll-out of the Global Business Services and Simplify & Transform initiatives.
“Meanwhile, we spent significant time and effort towards the completion and preparation of the intended acquisition by FedEx, which we expect to complete in the first half of 2016.”
TNT and FedEx are going through international regulatory approval to merge, and this is expected to be completed at the end of the summer.
Online marketplace eBay Australia and Woolworths CouriersPlease have announced that they are working together on a new pilot ‘Parcel Drop Off’ service that will be available in five Woolworths stores across Sydney.
This is similar to the scheme that eBay has in place with Argos in the UK whereby sellers can have their goods delivered via Argos stores called eBay Drop Off. Local eBay sellers will be able to drop off a sold item to a Woolworths store and shipped by CouriersPlease to the buyer.
The scheme offers a fixed price delivery model that is intended to “make selling online easier”.
eBay and Woolworths have already established a good working relationship, founded on their Click and Collect partnership.
Steve Brennen, Senior Director Marketing and Retail Innovation at eBay said: “When we launched our Click and Collect partnership with Woolworths one year ago we shook up the industry by allowing smaller sellers and their customers to take advantage of extra convenience and efficiency. Now we’re using our expertise to remove some of the friction involved in selling too.
“We see this as the natural extension of a partnership that has exceeded expectations to date. The Click and Collect partnership has rolled out nationally eight months ahead of schedule with more than 10,000 sellers now taking advantage of the program that has sent an additional 200,000 shoppers into a Woolworths or BIG W store.”
Tom Windeyer, Head of Marketplace at Woolworths added: “To date, over 200,000 customers have picked up their eBay parcels in our stores, giving them a more convenient and easy shopping experience. Parcel Drop-Off is just another way we are able to help our customers with convenient solutions that suit their individual lifestyles.”
Royal Mail managers that are members of Unite the Union have voted for strike action as part of a pay dispute.
Unite released a statement that said, “The managers, members of Unite, the country’s largest union, voted by 78% to take strike action and by 93% for industrial action short of a strike.”
Unite members rejected a 1.3% pay offer. The union said that it has now called for “urgent and constructive talks with Royal Mail’s management”.
Unite’s officer for Royal Mail members, Brian Scott, said: “We are already consulting our Royal Mail reps to decide what form the industrial action could take.
“We could be talking about an all-out strike which would cause severe disruption to deliveries to 27m addresses, but, in the first instance, we are likely to call upon our members to work to rule.
“Any action would have a detrimental impact on business and commerce.
“Unite repeats its offer for constructive talks with management at any time, any place to seek a fair settlement to this long-running dispute.”
In response the delivery company has said that it is very disappointed with the vote, but added that it wants to reach an agreement. It stated that it as “robust contingency plans in place” in case of any action.
In a statement a Royal Mail spokesperson said: “Royal Mail is very disappointed that members of Unite have voted in favour for industrial action and action short of strike over the 2015 pay offer for junior and middle managers. Any action or threat of action is damaging to our business.
“Royal Mail has proposed an average pay increase of 1.3% in base pay or a one off payment equivalent to 1.3% depending on a managers’ grade. This offer follows several months of discussions with Unite. We believe the pay offer is fair and competitive and was ahead of inflation at the time the offer was made in September. It also compares well with other external pay offers in the UK.
“Royal Mail notes that of those eligible to vote, 56 per cent did not vote or returned a vote for strike action. We want to reach agreement with Unite. In the event of any action, we have robust contingency plans in place to ensure we continue to deliver a high quality service.”
Royal Mail has done very well from the boom in e-commerce and is still far larger in terms of turnover and profit yield than any of its rivals. Unite’s position seems to be that its managers would like recognition for their role in the company’s success.
European delivery company Hermes Group has reported a turnover of €2.46bn for the financial year end 2015 – up 11% on the previous year. Booming e-commerce was the driver for this bumper year.
Hermes delivery companies moved 580 million shipment, 11% more than the year before. About 74% of this was from retailers outside Hermes Group’s parent company the Otto Group. Third party business expanded by 16% and the company said that it will continue this investment to “further secure its role as a preferred partner for e-commerce retailers”.
“The strategy of internationalisation was anchored early in the Hermes Group and is consistently pursued – and now it’s paying off. We have very successfully evolved from being a leading logistics supplier in the European market to become a global full service provider in e-commerce,“ commented Hanjo Schneider, member of the Otto Group board for Services and chairman of the supervisory board of Hermes Europe.
“We’re happy to be concluding our 12th year in a row with significant growth, as well as outperforming the competition in relevant markets such as Germany and the UK. We want to build on this in 2016. Digital transformation will continue to be the megatrend in our globalised world in the future. This is an exciting opportunity that opens up potentials for growth and clearly shapes our agenda at Hermes.“
Hermes Group also reported growth in the two-man delivery market. The company’s two man teams moved over 4.5 million pieces of furniture and large equipment, up 15% on the year before.
The Hermes statement added: “Despite the increasing competition in delivering to private customers, parcel business within Germany was again very successful in 2015.
“Alongside collaboration with new, large-scale clients from the shipping trade such as Yves Rocher and Glossybox, the company also won more small and medium-sized retailers as customers. The planned extension of the Hermes logistics network – representing an investment of over €300m – was one of the key drivers for this.
“From 2018, 35 predominantly newly designed or expanded logistics centres will provide even greater closeness to customers and shorter delivery times. The first new building is currently being put up in Bad Rappenau, Baden-Württemberg.”
Digital services also saw a lot of progress. The company highlighted some of the collaborative projects it is working on that include the ParcelLock system that it is developing alongside DPD and GLS.
Looking at its UK operations, Hermes commented: “The Hermes parcel division in the UK is the largest privately managed parcel service provider in the sector, and its growth has significantly outpaced the market in 2015.
“The 4,500 Hermes ParcelShops have made a significant contribution in this respect, and since their introduction in 2012 have become established as an alternative delivery address.
“Current investment in technology and infrastructure are helping continuing this expansion.
“Hermes UK is currently investing €23m in new handheld scanners with satellite-supported tracking software, as well as many other exciting projects.”
Nordic delivery company PostNord is working with Smart Home startup Glue and ICA, Sweden’s largest grocery chain to test a system where online customers can have their food delivered directly to their fridges at home.
PostNord released a statement explaining how the system will work: “With a Glue Smart Lock, the door to your home can be unlocked using a smart phone and you can hand out digital keys to family, friends or trusted companies.
“This way, the driver from the delivery company PostNord, who in advance has received the customer’s approval and digital key, can access their home and unpack the groceries from ICA.
“The customer does not have to adjust his or her schedule according to delivery times and the groceries are already unpacked when he or she gets home.”
The three companies launched the pilot in Sweden this week. They claim that it is a world first and unlike other claims by other companies (notably Domino’s Pizza’s delivery robot) this is likely to be a world first.
Anders Svensson, CEO of ICA Sverige, said that aim of the project was to “explore the future of grocery shopping online and push the development forward”.
Carl Johan Grandinson, CEO Glue, added: “Not only does this partnership take delivery services to the next level, it ‘unlocks’ the force of the on-demand economy and encourages people to think differently when it comes to opening up their homes for services that make everyday life easier.”
Such deliveries to the fridge are a useful next step for food deliveries. Already the issue of delivering cold and frozen goods to customers is being tackled by some companies yet this may well be the simplest and cheapest option for everyone involved and will get round the expensive and cumbersome idea of insulated packaging.
If we leave the EU, UK citizens could see a price rise of up to 30% on goods shipped from the EU and the average SME importer could pay more than £163,000 in red tape and transport costs according to delivery company Parcelhero.
David Jinks, Head of Consumer Research at Parcelhero calculated that the typical rise of 30% in costs would be down to:
– An average 5%-9% added to the price of an item in duties (where duties apply, depending on the item)
– Plus VAT of 20% (including shipping & insurance) when buying from countries within the EU – and only reclaimable in you are VAT registered
– Plus increased transport costs – the UK outside the EU would be a less competitive market for international couriers Plus ‘customs clearance’ charges from a courier company: typically around £15.
Jinks added: “The average SME regular importer/exporter to the EU (excluding ‘one man bands’) will be spending around £163k extra annually, including duties. The UK will face £11bn in new tariffs on imports of £220bn.”
He also concluded that: “A typical £150 purchase from the EU will now cost around £195, an increase of £45 or over 30%.”
Simple monetary costs aren’t the only issue according to Jinks. The report also argued that “businesses and consumers will face a mass of new red tape” as “Customs forms with proof of origin for every shipment arriving in the UK would be required”.
ParcelHero claimed that its research “reveals that increased delivery fees and higher import costs following the UK’s exit from the EU will hit SMEs and start-ups particularly hard; and add significant complication and increased expense for UK internet retailers and online marketplace traders doing business with the EU”.
As a consequence, claimed Parcelhero: “What might look like an exit could in fact become a wall between the UK and EU.”
In the interest of fairness, Parcelhero said there may also be benefits from Brexit. There are “benefits that might be gained for shippers of parcels, SMEs and small businesses were Britain to leave the EU”.
“While the EU has reduced average tariffs from 5 per cent in 1990 to 1 per cent in 2011, those on footwear and clothes remain high, which makes it difficult for more efficient producers outside Europe to export to the EU,” according to the report.
“Taking control of these tariffs may encourage trade with a wider variety of nations. This means withdrawing from the EU altogether could potentially reduce the prices of imported goods from outside the EU, on the assumption that the UK reduced tariffs to below EU levels.”
The report said that there were “strong reasons why Britain may have success if it votes to leave the European Union”, but then asked the rhetorical question: “Do they outweigh the evidence of ParcelHero’s own overseas shipment numbers and the level of duties and increased customs procedures and delays… that would strike an independent UK?”
The full report at: www.parcelhero.com/brexit
Lithuanian parcel delivery company LP EXPRESS is now providing a logistics service for pharmaceutical companies.
In a statement Lithuania Post, owners of LP EXPRESS said: “Using vehicles with installed modern temperature maintenance and control technologies, LP EXPRESS couriers can ensure qualitative and meeting the highest requirements and international standards delivery of items containing pharmaceutical products.”
Juozas Buitkus – the Head of Lithuania Post’s subsidiary Baltic Post, which operates the LP EXPRESS – said: “We are one of the first courier services providing companies in Lithuania that started transportation of pharmaceutical products in accordance with strict requirements established by both the European Union and Lithuanian legislation.
“So far pharmaceutical preparations have been transported only by companies operating in the pharmaceutical logistics field, providing special conditions for certain temperature maintenance; however, from now on LP EXPRESS couriers can meet the needs of companies producing medicine as well, i. e. to guarantee that transported pharmaceuticals are protected from the ambient temperature fluctuations.”
Buitkus added: “Having the modern temperature control and maintenance equipment installed in our vehicles, we can ensure from +2 to +25 degrees Celsius temperature, which is necessary not only to maintain the appropriate transport conditions of medications, but also of other temperature-sensitive products, e. g. cosmetics. The temperature regime will be guaranteed throughout all the logistics chain: from the collection and distribution of items, to their delivery.”
The Lithuania Post owned company expects that around 100 vehicles will be equipped with temperature controlled systems and LP EXPRESS will be able to move around 400 tonnes of pharmaceutical products every month.