The retail and logistics services provider Hermes extended its successful development in the financial year 2014/15. The Hamburg-based enterprise grew global revenue by over seven percent to 2.230 billion euros (2013/14: 2.083 billion euros). The European parcel and logistics business played a major role in this success moving over 530 million parcels. The number of employees rose 656 to 12,470 worldwide. In 2015, Hermes is adding new services for both private and business customers to enhance parcel shipments. The focus is on options for shipment delivery and customer-oriented solutions for cross-border shopping - even overseas.
"Hermes has been growing successfully for eleven years now. This is largely down to our early moves into international markets. Now we are pushing ahead with international expansion into Asia and North America and are looking to leverage business opportunities arising from the digital transformation," says Hanjo Schneider, member of the Executive Board Otto Group with responsibility for services and chairman of the Supervisory Board Hermes Europe GmbH. "We have a lot ahead of us in 2015. This includes the introduction of new services in our parcel unit, online solutions for global shopping and building up start-ups such as our storehouse service “Send & Store”. On top of this we are investing massively, particularly in our German logistics and technical infrastructure. Our intent is to make Hermes the logistics partner of choice for e-commerce players of all sizes."
Hermes offers the full range of services along the retail supply chain all under one umbrella brand - from the sourcing of goods and quality inspections through to transport and doorstep deliveries. Despite the somewhat strained situation in global politics and in business, Hermes grew its revenue in 2014/15 by over seven percent to 2.230 billion euros from 2.083 billion euros in the prior year.
Efficient European parcel network
Overall, Hermes' European distribution network moved more than 530 million parcels in 2014. In Germany, the UK, Austria, Italy and Russian parcel deliveries were up seven percent year on year (496 million). These shipments included around 12 million catalogues and more than four million items of furniture and household appliances. By securing cooperation agreements with national delivery partners in other EU states and integrating them into its own network, Hermes was able to enhance its intra-European parcel delivery service.
As a result, non-Group business climbed by 12 percent, the fifth year in succession it has achieved double-digit growth. One of the reasons for this is the documented delivery quality - attested over the years by independent experts. In 2014, for example, Hermes was once again ranked top in a survey conducted by German consumer watchdog, Stiftung Warentest.
More than 650 new jobs worldwide
In 2014, the number of people employed in the 12 Hermes companies rose worldwide to 12,470 (2013: 11,814 employees). Many of these new jobs were created in the UK. In the strong European e-commerce market, online shopping is becoming ever-present, a development that bodes well for the types of services Hermes provides.
The parcel business in Germany: new infrastructure and services
Hermes is looking to increasingly target small and medium-sized distance sellers in its drive to acquire new clients in Germany. By 2019 Hermes will have invested around 300 million euros in its logistics network. At the same time, Hermes is moving geographically closer to potential clients. An extensive 100,000 square meter distribution centre is currently being built in Löhne at a cost of a further 90 million euros. Hermes Fulfilment and the Group's 2-man handling unit Hermes Einrichtungs Service will be the new occupants, expecting to move in this year.
And to enhance the quality of deliveries to private households in Germany Hermes, in collaboration with other companies in the industry, is planning to introduce shared parcel boxes available to all parcel delivery services. A pilot phase will be starting shortly with the national launch expected for the second half of 2015. Customers can also expect to profit from the introduction of new services for parcel recipients which Hermes will be offering free of charge from Q4 2015. These services - such as the option to re-route parcels at short notice - will make waiting for parcels more convenient; a clear illustration of just how seriously Hermes is taking customer wishes, putting the recipient largely in charge of the delivery process.
BorderGuru: new service for overseas retailers
In 2015, Hermes is starting a new service it is calling BorderGuru, which, for the first time, allows online retailers to sell and deliver their goods around the world. As part of the process, a 'shipping client' is integrated on the client's website, which informs the end-customer of all the costs incurred - customs, transport, taxes - and coordinates both the shipping and the payment process. End-customers can also returned unwanted goods. Today, BorderGuru facilitates shipment from the US to all destinations worldwide. The coming weeks will see the start of initial tests for shipping from Europe to the US and China.
BorderGuru is the key to worldwide online shopping and can generate new impetus for the e-commerce sales channel. "The first tests have been conducted successfully and show how, thanks to this this smart solution, we can help international retailers to close service gaps and address new target groups. Retailers have responded very positively to the one-stop processing, to transparency of costs and to the customer-friendly tracking system," explains Schneider.
This should enable European and American retailers to sell more goods in the growing Chinese market. At the same time it gives Chinese e-commerce providers the opportunity to expand into Europe and makes it possible for them to call on other Hermes service options covered by distribution, fulfilment and quality assessment.
International transport logistics focusing on the Asian logistics market
To serve the rising demand for international transport from and to Asia from Europe better in the future, Hermes is expanding its market presence in China. Accordingly, Hermes Transport Logistics Asia was established, with offices in Hong Kong and Shanghai.
This targets Chinese retailers looking for logistics solutions both in sourcing and shipping goods. Its focus is on both turnkey supply chain solutions and environmentally sound sea and airfreight transportation.
"With the growth in internationalisation, there is the parallel growth in the responsibility to shape the global supply chain in a sustainable fashion. Here, Hermes provides suitable offers and services worldwide," says Schneider.
Hermes Otto International has strengthened its commitment to Asia by setting up ASTRA Supply Chain Service Ltd. The company offers combined services in the field of auditing and quality control in key sourcing markets as well as IT-based supply chain solutions, with the main focus being service provision for the textiles industry. ASTRA maintains inspection centres in several key locations, including Dhaka, Shanghai, Qingdao, Bangkok, Tirupur, Mumbai, Istanbul and Izmir.