A strong entrepreneurial spirit is evident in all DHL Express’s activities. The company has opened new branches in the most remote corners of the word, kept its operations ongoing in territories registering tight pressures as Libya for instance and shows no fear when transporting Sumatran tigers from US and Australia to UK.
As for Romanian business, the Managing Director of DHL Express Romania Daniel Kearvell talked with Romanian Business Digest and gave details of the company’s strategy on the local market and gave his feeling about the growing perspectives locally.
“We are optimistic about the market at the moment, albeit slightly cautiously so. Whilst we are not seeing spectacular macroeconomic figures or external environment generally, DHL’s strong growth points to there certainly being some positive developments in the market.”
The SMEs is a significant market segment for DHL Express business in Romania, as the company is making 80 percent of total operations in Romania from it, Daniel Kearvell states. According to the manager, the company maintains a stable business from the international customer portfolio, servicing large multinational companies from automotive, engineering and manufacturing sector that consist of some of the main investors in Romania. Nevertheless, in Romania, the company is focused on serving the international express requirements of the local business that is coming from the SMEs sector, which comprise 80 percent from DHL Express operations in Romania.
According to the Managing Director, the company signed only in March this year 119 new contracts of which, 100 has been inked with SMEs-type companies. “I find quite a high sense of entrepreneurship in the region and in Romania particularly, which is a natural fit for an increasing sense of market internationalization. That is because firstly the international markets became more and more available due to the logistics, new technologies, Internet but also to do with the fact that local market is not providing at this moment the growth parameters to meet the needs of Romanian business,” Daniel Kearvell says. Consequently, he explains, the local businesses need to reach international markets and distribute their products where there is the required demand. “There are many areas where Romania enjoys significant competitive advantage, such as the textile industry, one of DHL’s biggest partners in Romania,” Daniel Kearvell adds.
“Given the sluggish domestic demand, and the improved connectivity of Romania with the rest of the world, more and more companies are looking to access international markets with which to trade. This increased international demand is also a strong contributor to DHL’s growth.”
DHL’s growth is partly attributable to the favorable conditions the Romanian environment and economy offers, but also a result of the company’s strategy to focus on the SME segment in Romania. This is not only resulting from the economic need to support the growing small and medium-sized business segment, but it is also because many of the existing companies in this area in Romania hold already a strong background with international partners. From DHL’s studies, 26 percent of companies that have international partners grow ahead of the market while only 13 percent of SMEs having domestic partners do the same. Also, a major conclusion of these studies is that it is more likely for an SME-type company to have an international partner in the early stages of its business, when it needs to develop and find the right offer on external markets. The major export destinations for Romanian companies are Germany, France, UK, US, Spain, Italy, China and also Russia.
Getting along with the SMEs
In spite of the overall economic sluggishness, the DHL manager maintains a good level of optimism. “Despite the unhelpful external environment of the last years, as well as the challenging macroeconomic background, we have seen some really good records in this time,”Daniel Kearvell underlines. The company has 5,000 customers of all different types of industries and performed an increase of 14 percent in shipments in March, good signs for the current and forthcoming years. “I am confident that 2013 has the potential to bring positive business results for DHL Express’s business in Romania. The stability of the political environment has of course an impact over the business in terms of setting a long-time strategy but our core operations in the Time Definite International markets serving and industries such as technologies, automotive, manufacturers and distributors maintain the increasing pace of our volumes and business figures,” DHL Express Romania Managing Director states.
For a company operating in the courier and logistics industry, the infrastructure of a country is of paramount importance. According to company’s data, their express courier service reaches every single corner of the country through their 200 vehicles, and with several thousand customers, the company is a good barometer of a country’s economy. Still the state of local state of local infrastructure is improving, according to the manager adding that it needs “fine-tuning” in order to become more competitive. “Especially for time-sensitive products, the necessity of reaching destinations fast and in time is crucial both for our customers and for the efficient growth of the economy as a whole,” Daniel Kearvell adds.
DHL Romania activity in numbers:
- A fleet of 200 vehicles
- 3 aircrafts (2 SAAB SF 340 and 1 Boeing 757)
- 3.5 million Shipments processed annually
- 5,000 customers
- 4 international gateways - 3 for air express in Arad, Bucuresti and Cluj and one for road express in Oradea
- 119 new contracts signed in March 2013