(Interview with DHL eCommerce CEO Charles Brewer)
Globally, online sales account for about 9 percent of retail sales, while in Asia it’s greater than 10 percent, so Asia is a big marketplace for the corporate, Brewer says.
Thanks to its aggressive marketing campaign, DHL has grow to be a household name not only in India but in several Southeast Asian countries. The company works with quite a few e-commerce and brick-and-mortar firms to offer last-mile connectivity in Asia, except Europe and the Americas.
DHL eCommerce, the e-commerce logistics unit, works with leading retailers and marketplaces in Asia, which is a strategically necessary market. The Bern, Germany-based company recently developed the eco-friendly StreetScooter and driverless Parcelcopter helicopter for last-mile deliveries within the country. As a part of its expansion plans, DHL plans to introduce these recent vehicles to Asia within the near future.
We spoke to DHL eCommerce CEO Charles Brewer to learn in regards to the company’s plans for Southeast Asia and India.
E-commerce is among the many fastest growing sectors in India and is predicted to grow at a CAGR of 52% to achieve $36.7 billion by 2020. How well prepared is DHL eCommerce to capitalize on this chance?
Through Blue Dart, the DHL eCommerce subsidiary, and other DHL business units (DHL Express, DHL Supply Chain and DHL Global Forwarding), we’re the market leader within the logistics industry in India and we’ll proceed to take a position and develop our capabilities to remain ahead of the curve. For example, we’ve got just announced an investment of €70 million ($75 million) to expand our airport hubs in Delhi and Mumbai. This allows for improved service levels and greater efficiency to handle the ever-increasing volumes expected from the e-commerce sector.
Indian B2C e-commerce has been going through a difficult period recently, while B2B e-commerce has been witnessing significant growth. How do you assess this trend?
We are convinced that the e-commerce segment will proceed to grow. In India, we expect this to grow to EUR 30-40 billion ($32-42 billion) by 2020, growing at a CAGR of 30-35 percent over 2014-2020. Going forward, Blue Dart will probably be focused on further developing our market leadership within the B2C e-commerce logistics space and we’re investing hugely on this space through our people, our services, our technology, modern solutions and expanding our footprint in India.
What are the important thing benefits of the SEA e-commerce and logistics market in comparison with Europe?
Southeast Asia, like many other markets, will proceed to experience tremendous growth within the e-commerce sector. It is a market of over 630 million people – a big and growing population. Online sales account for about 3% of retail sales. It has a rapidly growing online environment, considered one of the fastest growing m-commerce markets and will probably be the subsequent e-commerce wonderland.
B2C e-commerce is growing rapidly in Asia, but an enormous proportion of purchases are still made offline because a big proportion of individuals live in rural areas. What plans does DHL eCommerce plan to make the most of this huge opportunity?
Globally, online sales account for about 9%. retail sales, while in Asia it accounts for over 10%, so Asia is barely ahead of the remaining of the world. That said, the opportunities are still significant and, as you’ll be able to see, many online retailers at the moment are focusing increasingly on secondary and tertiary markets where retail access is proscribed. In India, Blue Dart recently increased the variety of PIN (Postal Index Number) codes it supports. We currently have a broad portfolio of over 5,400 PIN codes and can proceed to aggressively expand and expand our reach.
Many B2C logistics firms in India have closed or scaled back their operations over the past few months. How do you take a look at this slow development of B2C e-commerce logistics?
With increasing web and mobile penetration, the e-commerce market in India can only get larger. We still see great potential on this market, which is why we’re investing EUR 70 million ($75 million). As a world-leading logistics company with a presence in over 220 countries and territories, combined with Blue Dart’s unrivaled local expertise, we’re fully committed to India and see a really brilliant future. We put a smile on the last mile.
Given the complexity of the Indian market, is it impossible for DHL to bring its Parcelcopter and other innovations to India within the near future? So are you planning to take a position or acquire startups on this space which have higher local knowledge and experience?
DHL at all times “thinks globally and acts locally”… and in India we’ve got a unbelievable and really “local” company in Blue Dart, which has been the market leader in India since its inception within the Nineteen Eighties.
As for using Parcelcopter in India, we might like to achieve this, but after all it is determined by local regulations. So, while chances are you’ll not see the Blue Dart Parcelcopter flying around India anytime soon, we’ll achieve this as soon as we get permission to achieve this.
Are you, like other large multinationals, planning to launch a VC fund for the logistics segment in India?
No, not in the meanwhile.
(source : https://e27.co/suth-east-asia-next-ecommerce-wonderland-dhl-charles-brewer-20161123/)
