SUMMER TRAINING REPORT ON

Project on the framework of DHL

Undertaken at

“DHL”

Submitted in partial fulfillment of the requirements for the

award of the degree of

B.com (Hons)

By

Utsav Saggar

Enrollment no. - 41717788817

Vivekananda School of Business Studies

Vivekananda Institute of Professional studies

Guru Gobind Singh Indraprastha University, Delhi

December - 2019
 Acknowledgement

To Whom It May Concern

I, Enrollment N o . 4 1 7 1 7 7 8 8 8 1 7 from B.Com Semester 5 of the Vivekananda Institute of Professional

Studies, Delhi hereby declare that the Summer Training Report (B.Com 309) titled ‘the world’s largest logistic
company i.e. DHL’

Conducted at DHL is an original work and the same has not been submitted to any other Institute for the
award of any other degree. A presentation of the Summer Training Report was made on and the suggestions as
approved by the faculty were duly incorporated.

Date:
Signature of the Student
 Certificate

Utsav Saggar, with enrollment no. 41717788817 has submitted a Summer Training Report
titled ‘The World’s Largest Logistics Company’ conducted at DHL for partial fulfillment of
B.com (Hons) to be awarded by G.G.S.I.P. University, Delhi. I certify that this report has been
completed under my guidance and is satisfactory.

Date: Signature of the Guide

Name of the Guide:

Designation:
CHAPTER 1 :
Introduction of the project
INTRODUCTION

DHL (Dalsey, Hillblom and Lynn) International GmbH is an American-founded German

company which is now the international courier, parcel, and express mail division of the German
logistics company Deutsche Post DHL. Deutsche Post DHL is the world's largest logistics
company,now in over 220 countries and territories worldwide, particularly in sea and air mail.
The company delivers over 1.3 billion parcels per year.

The company was founded in the United States in 1969 and expanded its service throughout the
world by the late 1970s. The company was primarily interested in offshore and intercontinental
deliveries, but the success of FedEx prompted their own intra-US expansion starting in 1983.

In 1998, Deutsche Post began to acquire shares in DHL. It reached controlling interest in 2001,
and acquired all outstanding shares by December 2002. The company then absorbed DHL into
its Express division, while expanding the use of the DHL brand to other Deutsche Post divisions,
business units, and subsidiaries. Today, DHL Express shares its DHL brand with business units
such as DHL Global Forwarding and DHL Supply Chain. It gained a foothold in the United
States when it acquired Airborne Express.

The DHL Express financial results are published in the Deutsche Post AG annual report.[7] In
2016, this division's revenue increased by 2.7% to €14 billion.The earnings before interest and
taxes (EBIT) increased by 11.3% over 2015 to €1.5 billion.

Origin of DHL

While Larry Hillblom was studying law at University of California, Berkeley's Boalt Hall School
of Law in the late 1960s, he accepted a job as a courier for the insurance company Michael's, Poe
& Associates (MPA). He started running courier duty between Oakland International Airport and
Los Angeles International Airport, picking up packages for the last flight of the day, and
returning on the first flight the next morning, up to five times a week.

After he graduated, Hillblom met with MPA salesman Adrian Dalsey and they planned to
expand MPA's concept of fast delivery to other business enterprises. They flew between
Honolulu and Los Angeles, transporting bills of lading for their first client, Seatrain Lines.
The initials

Hillblom put up a portion of his student loans to start the company, bringing in his two friends
Adrian Dalsey and Robert Lynn as partners, with their combined initials of their surnames as the
company name (DHL).They shared a Plymouth Duster that they drove around San Francisco to
pick up the documents in suitcases, then rushed to the airport to book flights using another
relatively new invention, the corporate credit card. As the business took off, they started hiring
new couriers to join the company. Their first hires were Max and Blanche Kroll, whose
apartment in Hawaii often became a makeshift flophouse for their couriers.

Domestic expansion

In the 1970s, DHL was an international delivery company, and the only one offering overnight
service. The only major competitor in the overnight market was Federal Express (FedEx), which
did not open its first international service until 1981, expanding to Toronto, Ontario, Canada.
Nevertheless, the domestic market was extremely profitable, and DHL was the third largest
courier behind FedEx and UPS.

When Adrian Dalsey, Larry Hillblom and Robert Lynn founded DHL in 1969, they didn’t know
they would revolutionize the world of logistics. Today, DHL is the world’s leading logistics
company. Our 380,000 people in over 220 countries and territories work every day to help you
cross borders, reach new markets and grow your business. Or simply send a letter to your loved
ones. We are an international team of over 380,000 shipping professionals, united by a passion
for logistics. And we work in a unique environment. DHL is as innovative as a start-up, with the
power of an international organization.

Deutsche Post purchase

Deutsche Post began to acquire shares in DHL in 1998, acquiring controlling interest in 2001. By
the end of 2002, Deutsche Post had acquired all of DHL's remaining stock, and absorbed the
operation into its Express division. The DHL brand was expanded to other Deutsche Post
divisions, business units and subsidiaries. Today, DHL Express shares its DHL brand with other
Deutsche Post business units, such as DHL Global Forwarding, DHL Freight, DHL Supply
Chain, and DHL Global Mail.

1999: Deutsche Post World Net (DPWN) purchased the Dutch shipping company Van Gend &
Loos as well as Swiss freight forwarder Danzas

2001: Deutsche Post acquires a majority (51%) of DHL's shares, and the remaining 49% in 2002.
The new DHL is launched by merging the old DHL, Danzas, and Securicor Omega Euro
Express.

After 2001

DHL G-BIKC: ex British Airways Boeing 757, converted to cargo type in 2001 - Landing at
Madrid Airport (Spain) - Old DHL color scheme and logo .

In 2001, The Packstation, an automated delivery booth, was introduced as a pilot project in
Dortmund and Mainz. In December 2002, DHL Introduced the new red and yellow color scheme
and logo. All US domestic flights were handled by DHL Airways, Inc. which was renamed
ASTAR Air Cargo in 2003, following a management buyout. DHL's first airline still remains
with over 550 pilots in service, as of October 2008.

On August 2003, Deutsche Post acquired Airborne Express, and began its integration into DHL.
In September 2004, a planned expansion by DHL at Brussels Airport creates a political crisis in
Belgium. In 21 October 2004, DHL Express announces that it will move its European hub from
Brussels to Leipzig, Germany (Vatry, France was considered and rejected). DHL's unions call a
strike in response, paralyzing work for a day.

On 8 November 2004, DHL Express invests €120 million in Indian domestic courier Blue Dart
and becomes the majority shareholder in the company. In September 2005, Deutsche Post makes
an offer to buy contract logistics company Exel plc, which had just acquired Tibbett & Britten
Group.

On 14 December 2005, Deutsche Post announces the completion of the acquisition of Exel plc.
When integrating Exel into its Logistics division, it adds its well-known DHL brand acquired
with the purchase of DHL Express to form the name DHL Exel Supply Chain. Following the
latest deal, DHL has a global workforce of 285,000 people (500,000 people including DPWN
and other sister companies) and roughly $65 billion in annual sales.

In September 2006, DHL wins ten-year contract worth £1.6 billion, to run the NHS Supply
Chain (part of the UK's National Health Service). DHL will be responsible for providing
logistics services for over 500,000 products to support 600 hospitals and other health providers
in the United Kingdom.

As part of this new contract, in 2008 DHL will open a new 250,000 sq ft (23,000 m2)
distribution centre to act as a stock holding hub for food and other products, with another
distribution centre opening in 2012. The two new distribution centres will create around 1,000
new jobs. In September 2007, DHL Express co-founds new cargo airline AeroLogic, based at
Leipzig/Halle Airport, in a 50:50 joint venture with Lufthansa Cargo. The carrier will operate up
to 11 Boeing 777Fs by 2012. In December 2007, DHL becomes the first ever carrier to transport
cargo via wind powered ships flying MS Beluga Skysails kites.

In May 2008, DHL Aviation moves its central depot to Leipzig; Germany, resulting in a
significant positioning for improved service and timeliness to the European Union. On 28 May
2008, DHL Express announces the restructuring plans for its United States network, including
terminating its business relationship with ABX Air and entering into a contract with competitor
UPS for air freight operations. Its cargo hub shifts from Wilmington to Louisville.The Air Line
Pilots Association, International protests.

On 10 November 2008, DHL announces that it is cutting 9,500 jobs as it discontinues domestic
air and ground operations within the United States to deal with economic uncertainty. It is
retaining international services, and is still in talks with UPS to transport DHL packages between
U.S. airports.

On 30 January 2009, DHL ends domestic pick up and delivery service in the United States,
effectively leaving UPS and FedEx as the two major express parcel delivery companies in the
United States Limited domestic service is still available from DHL, provided that the packages
are tendered to USPS for local delivery. Newegg and RockAuto are companies that use this
option as of March 8, 2016.
In April 2009, UPS announces that DHL and UPS have ended negotiations for an agreement for
UPS to provide airlift for DHL packages between airports in North America. DHL says in a
statement, "We have not been able to come to a conclusive agreement that is acceptable to both
parties." DHL continues to use its current air cargo providers, ASTAR Air Cargo and ABX Air
for now.

On June 13, 2013 in Erlanger, Kentucky, USA, the company's newly expanded and upgraded
global hub is opened at the Cincinnati/Northern Kentucky International Airport.
Objectives of the project :

 To have an in-depth comprehension of how the framework functions in DHL.

 To understand the strategy development undertaken by the company in order to provide
ridiculously fast delivery services
 To study of customer satisfaction level of DHL.
 To find the market potential and market penetration of DHL.

Scope of the project :

The topic that I have chosen for my project is ‘Study on the world”s largest logistic company i.e.
DHL. By working in this company , I gained a lot of experience in the field of marketing . This
sector has helped me in improving my communication skills by interacting with professional
executives in the marketing department . The exposure I gained in this field has enhanced my
ability to tackle hindrances in a professional way.
COMPANY PROFILE

DHL Worldwide Express, a privately held worldwide delivery service comprised of DHL
Airways and DHL International, is the world's oldest and largest international air-express
company. Since 1969 when it began as an air-courier service from California to Hawaii, the firm
has grown phenomenally and dominates the global express marketplace, delivering to over
70,000 destinations in 227 countries. DHL delivers both small and heavyweight parcels to
destinations from the Middle East and Pacific Rim countries to throughout Europe and the
United States. DHL's ever-expanding international presence prompted such stateside competitors
as Federal Express and United Parcel Service, as well as the United States Postal Service, to join
the fray of global express delivery.

Three Men and a Purpose, 1969-79

DHL was founded by three young shipping executives--Adrian Dalsey, Larry Hillblom, and
Robert Lynn--who were casting about for a way to increase turnaround speed for ships at ports.
They reasoned that if the shipping documents could be flown from port to port, they could be
examined and processed before the ships arrived, and speeding up the process would decrease
port costs for shippers. With this in mind, the trio combined the first letters of their last names to
form the acronym DHL, thus beginning an air-courier company that revolutionized the delivery
industry.

DHL rapidly developed into an express delivery service between California and Hawaii, then
quickly expanded to points east. The company's primary customer was the Bank of America,
which needed a single company to carry its letters of credit and other documents. DHL branched
into the international market in the early 1970s when it began flying routes to the Far East. In
addition, while competitor Federal Express was developing its domestic overnight delivery
network, DHL focused on further developing its international service.

In 1972, the three original investors recruited Po Chung, a Hong Kong entrepreneur, to help them
build a global network. Chung started DHL's sister company, DHL International Ltd.,
headquartered in Brussels, Belgium. Since that date DHL Worldwide has functioned as two
separate companies, DHL Airways, Inc. based in Redwood City, California, and DHL
International. While each company acted as the exclusive agent for the other, by 1983 DHL
International had grown to be five times larger than its domestic counterpart. DHL International's
rapid expansion continued throughout the 1970s, adding destinations in Europe in 1974, the
Middle East in 1976, Latin America in 1977, and Africa in 1978.

FedEx and UPS Up the Ante, 1980-88

The 1980s would bring the firm increased growth as well as greater competition. During this
time DHL continued to expand, by turns cooperating with competitors and warring with them.
The company also sought new outlets for service, working out an arrangement with Hilton
International Co. in 1980, agreeing to provide daily pickup of documents at 49 Hilton Hotels,
arranging for international delivery--its couriers moving the packages through customs--then
delivering them locally. It was a win-win situation as Hilton was able to offer its patrons a high-
class delivery service and DHL was guaranteed new outlets for its business. The next year, 1981,
DHL flew 10 million shipments between 268 cities and had approximately $100 million in sales.
The following year, Lawrence Roberts, who had founded Telenet Communications Corp. and
headed GTE, joined DHL Corp. as president.

Although DHL had a strong international presence, business was occasionally made difficult
because it was necessary for the company to negotiate with foreign governments. In 1982, for
example, the French post office sought to reassert a monopoly dating back to the 15th century,
and DHL--possessing 80 percent of the French market--was ordered to halt operations outside
Paris. What could have been a potential crisis for the company was, however, favorably resolved.

DHL continued to expand its horizons, though, adding Eastern bloc nations in 1983. Prior to
1983, DHL had not pursued much business in the United States, leaving the field to Federal
Express and United Parcel Service (UPS). Despite counting 97 percent of the nation's 500 largest
companies among its customers, DHL still held only a minuscule share of the overall domestic
market. To bolster its share of the American market, DHL installed two major hubs at airports in
Cincinnati and Salt Lake City, and added nine mini-hubs in major cities across the country. The
company also bought three Boeing 727s and seven Learjets, as well as new sorting equipment. In
addition, in 1983 DHL Worldwide started using helicopters in New York and Houston to
expedite documents during rush hour and the following year initiated helicopter service in Los
Angeles as well.
Once the hubs had been installed, DHL Airways began offering point-to-point overnight service
between 126 American cities. Still, for the year ending in 1983, DHL reached only two or three
percent of the domestic market--yet had more than 5,000 employees with 400 offices in over 90
countries. As in its earliest days, banks accounted for a large portion of its business; other
common shipments consisted of computer tapes, spare parts, and shipping papers. That year,
DHL estimated it carried 80 percent of the bank material traveling by courier from Europe to the
U.S. and revenues were approximated at $600 million. In 1984, as former courier-driver Joseph
Waechter became president of DHL Airways, DHL provided service to more than 125 countries,
and its 500 stations were handling 15 million international and domestic shipments annually.

But just as DHL was looking to cut into the business of its domestic competitors, those same
companies were aiming to siphon off portions of DHL's international business. In 1985 both
Federal Express and UPS entered the international express market. As competition became more
intense, DHL increasingly began to cooperate with businesses in similar areas. The company
teamed up with Western Union to deliver documents generated on Western Union's EasyLink
electronic mails, allowing people to send documents via courier without having to hand-deliver
material to the courier's office. The next year, 1986, as DHL International formed its first joint
venture with the People's Republic of China, known as DHL Sinotrans, Charles A. Lynch was
named chairman and chief executive of DHL Airways, replacing Roberts. Lynch remained with
the company just two years and was replaced by Patrick Foley, the former chairman of Hyatt
Hotels. Meanwhile, FedEx and UPS were eroding DHL's market share, which fell from 54
percent in 1985 to 50 percent in 1987. However, an important competitive battleground existed
in Japan, and while FedEx and UPS gained footholds in that country in the 1980s, by 1988 DHL
still controlled 80 percent of the Japanese overseas market.

As the world economy boomed in the 1980s, DHL followed suit, even breaking new ground in
the Communist-bloc countries. The company had first cracked the eastern bloc in 1983, when it
began delivering packages to Hungary, East Germany, and several other countries. DHL
Airways was not slouching either, reporting that between 1986 and 1987 alone, its volume rose
34 percent; in 1987 it was the 318th largest private company in the United States, with 5,000
employees and estimated sales of $375 million. Revenues for the entire DHL network, in 1988,
were calculated to be between $1.2 and $1.5 billion, helped in part by another joint venture with
a Hungarian company to create DHL Budapest Ltd. That year, DHL controlled 91 percent of the
packages bound for Eastern Europe from the West and 98 percent of all outbound shipments.

Holding and Increasing Market Share, 1989-93

In 1989, DHL Worldwide was the 84th largest company in the United States with 18,000
employees, more than 50 million shipments, and service to 184 countries. However, though
DHL's international success was becoming firmly established, the company was not making the
headway it had planned in the United States. As of 1989, DHL had only five percent of the
domestic market. To bolster its name recognition in the United States, the company turned to
innovative advertising techniques, including the use of humor. Cartoonist Gary Larson, creator
of the wildly popular comic "The Far Side," was employed to draw cartoons for use in DHL
advertising, and in 1990 the company introduced a campaign featuring flying DHL vans
whizzing past competitors' planes. DHL also took an unusual approach to air delivery. Although
the company used its own fleet of planes within Europe and on some major routes, DHL often
used scheduled airlines to carry its shipments. Federal Express, in contrast, maintained its own
fleet and seldom used other airlines. Rather than purchase its own planes, DHL chose instead to
invest its capital in technology and ground-handling equipment, spending some $250 million on
those areas in 1990 and 1991 alone.

In 1990, in order to infuse the company with fresh capital and take advantage of the resources of
larger airlines, DHL International sold parts of its business to three companies. Japan Air Lines
and the German airline Lufthansa each purchased five percent, while Nissho Iwai, a Japanese
trading company, purchased 2.5 percent. Each firm also had the option of buying greater shares.
In addition, the three companies also own a combined stake of 2.5 percent in the U.S-based DHL
Airways. The sale of these closely held interests brought $500 million in capital into the firm.
The same year, despite a 60 percent share of the international overnight delivery market, the
company began to expand into new areas of business. To keep up in an increasingly competitive
industry, DHL Worldwide entered the freight services industry and began carrying heavier cargo.
In the company's 20-year history of carrying small packages--generally under 70 pounds--this
was DHL's first major departure from its core business. In 1991, DHL Worldwide had revenues
of $2.3 billion, and was the 59th largest private company in the U.S., its 21,000 employees
handling more than 80 million shipments.
In June 1992, all three of DHL's major shareholders exercised their option to increase their
shares in DHL International; Japan Air Lines and Lufthansa each increased their stake to 25
percent, while Nissho Iwai's holdings grew to 7.5 percent. This was also the year DHL began
service to Albania, Estonia, Latvia, and Greenland, and reestablished ties with Kuwait. In
addition, in an unusual move DHL signed an agreement to share transatlantic and European
aircraft operations with one of its competitors, Emery Worldwide. The economic recession and
an overcrowded North Atlantic airway were cited as the reasons behind these cooperative
measures, which would allow greater operating efficiency and expanded service. The
arrangement represented the first of several alliances between integrated carriers, due to
increasing pressure from other competitors, including Airborne Express and TNT. In 1993 as
revenues hit $3 billion, DHL commenced a four-year $1.25 billion capital spending program to
step up its technological capabilities, automation, and communications.

Towards a New Century, 1994 Onward

By 1994, DHL Worldwide's 25-year anniversary, the company controlled 52 percent of the
Asian express shipment marketplace, with FedEx and UPS garnering a 24 percent slice each. The
next year, DHL poured over $700 million into expansion of its Pacific Rim operations. DHL was
not only shoring up facilities in Hong Kong and Australia, but venturing into 16 new cities in
China, India, and Vietnam. A new $60 million hub at Manila's Ninoy Aquino International
Airport was scheduled to open in late 1995, with additional facilities slated for Bangkok, Tokyo,
Auckland, and Sydney. In the midst of its ambitious expansion, DHL was rocked by the news of
founder and majority shareholder Larry Lee Hillblom's death. Known as an avid though reckless
pilot (he had survived a previous crash and had his pilot's license suspended), Hillblom, who had
withdrawn from DHL's daily operations in 1980, was killed in a seaplane accident near Saipan
where he lived.

The management at DHL was soon embroiled in an ugly controversy after Hillblom's 1982 will
was released, as a spate of paternity claims and lawsuits were filed. Lurid details of Hillblom's
penchant for young island girls reached the press, including an in-depth exposé in the generally
staidWall Street Journal.Since Hillblom had retained a mighty 60 percent of DHL Airways and
23 percent of DHL International (valued conservatively at the time at around $300 million), the
company's officers scrambled to exercise an option to repurchase his shares. Yet financing and a
host of complications held up the buyback and soon the entire estate was a miasma of lawsuits,
bad judgement calls, and island politics.

Yet 1995 was still a good year for DHL Worldwide, as the company debuted its web site
(www.dhl.com) and experienced an overall 23 percent growth in revenue to $3.8 billion, with an
incredible 40 percent surge in volume in its Middle East operations. In response to the
encouraging numbers, DHL broke ground on a new $4 million state-of-the-art express facility at
the Dubai International Airport in the United Arab Emirates in 1996. The new 42,000-square-
foot hub was to complement DHL's existing facilities in Bahrain. Over on the Asian continent,
DHL broke with its longstanding tradition of leasing planes to buy its own cargo fleet. Though
DHL International's previous strategy of leasing out cargo space had proved both successful and
prudent, Chairman and CEO Foley told theSan Francisco Business Timesthe company needed to
control its own destiny, and having its own fleet would help alleviate the space limitations and
scheduling snafus of commercial flights.

In 1996, DHL was looking to the future again by announcing plans for a $100 million hub in the
Midwest to carry the company through the next two decades. While its Cincinnati "superhub"
handled around 45 incoming flights every night, and sorted over 135,000 pieces at a rate of
60,000 per hour--DHL believed its growth would soon outpace the facility. The same was true
for the San Francisco area, where Silicon Valley shipments represented 40 percent of DHL
Airways' business in the Bay Area. Internationally, DHL was still growing at the speed of sound
with expansion in the former Soviet Union to 37 branches, a new facility at Ferihegy Airport in
Budapest, and the acquisition of Shigur Express in Israel. Though DHL had worked with Shigur
for years, the $3.5 million purchase gave DHL a firmer presence in the country's emerging
market. By 1998, DHL served 227 countries with 2,381 stations in cities from Paris and Prague
to Bombay and Bangkok with over 53,200 employees. Stateside, however, DHL Airways still
represented less than two percent of the market, though the California-based company got a
boost from the Teamsters' strike against UPS.

As the 1990s came to a close, DHL International announced its intention to sell a 22.5 percent
stake in the company to Deutsche Post AG, for an infusion of funds and to strengthen its
presence in Germany. With the air cargo industry projected to grow at an annual rate of 6.7
percent for the next dozen or so years, DHL International continued to stave off competitors and
dominated global express shipments with over 40 percent of the market. Its U.S.-based sibling,
DHL Airways, maintained a healthy bottom line and was positioned to carve away at the market
share of FedEx and UPS.

When Adrian Dalsey, Larry Hillblom and Robert Lynn founded DHL in 1969, they didn’t know
they would revolutionize the world of logistics. Today, DHL is the world’s leading logistics
company. Our 380,000 people in over 220 countries and territories work every day to help you
cross borders, reach new markets and grow your business. Or simply send a letter to your loved
ones. We are an international team of over 380,000 shipping professionals, united by a passion
for logistics. And we work in a unique environment. DHL is as innovative as a start-up, with the
power of an international organization.

Services

DHL Express's global headquarters are part of the Deutsche Post headquarters in Bonn.

Headquarters for the Americas are located in Plantation, Florida, USA, while its Asia-Pacific and
emerging markets headquarters are located in Singapore, Malaysia, Hong Kong, and China. The
European hub is in Leipzig, Germany.

Most of DHL Express' business is incorporated as DHL International GmbH.

Major competitors include FedEx, UPS and national post carriers such as United States Postal
Service (USPS) and Royal Mail. However, DHL has a minor partnership with the USPS, which
allows DHL to deliver small packages to the recipient through the USPS network known as DHL
Global Mail, now known as DHL eCommerce. It is also the sole provider for transferring USPS
mail in and out of Iraq and Afghanistan.

DHL offers worldwide services, including deliveries to countries such as Iraq, Afghanistan and
Myanmar (formerly Burma). As it is German-owned, DHL is not affected by U.S. embargoes or
sanctions and will ship to Cuba[27] and North Korea.However, there are strict codes for
delivering to North Korea, as the country has shaky relations with the West.
As DHL is no longer a United States company, it is not allowed to make domestic flights
between U.S. airports. DHL contracts these services to other providers.

Environmental record

DHL has taken measures to control their environmental effect by use of alternative fuel vehicles.
DHL changed vehicles in certain delivery fleets in order to use alternative fuels. Certain new
vehicles use compressed natural gas, to which DHL hopes to convert 50% of their vehicles in the
future.

On 16 September 2005, DHL won a High Court injunction establishing an exclusion zone
around each of its 288 buildings in the UK as well as the homes of its 18,000 UK employees.
The firm has been the subject of a campaign of intimidation because of their business with
Huntingdon Life Sciences. The judge banned protesters from coming within 50 yards (46 m) of
any DHL premises or the homes of their employees as well as any organized demonstration
within 100 yards (91 m) unless the police had been given four hours' notice. The injunction also
protects anyone doing business with DHL from intimidation.

Use of electric vehicles

Electric StreetScooter Work (2016)

In December 2014 Deutsche Post DHL purchased the StreetScooter company, a small
manufacturer of electric vehicles as part of its long-term goal to reach zero emissions in its
delivery operations. By year end 2016, some 2,000 vehicles had been produced.

In the future, electric vans with a much greater range will be required to achieve the long term
goal of replacing the entire Deutsche Post and DHL Express fleet of approximately 70,000
vehicles with StreetScooter models.

The Deutsche Post/DHL GoGreen program plans to reduce emissions of greenhouse gases and
local air pollutants; the company has four interim goals for doing so, to be achieved by the year
2025. The long-term goal, summarized by Frank Appel, Chief Executive Officer, is more
aggressive. "From now until 2050, our mission will be to drive our business toward zero
[logistics related] emissions. We are setting the standard for the future of the transport sector and
doing our part to help the world community reach its goal of limiting global warming to less than
two degrees Celsius."

BYD supplies DHL with electric distribution fleet of commercial BYD T3

DHL aviation

DHL Aero Expreso Boeing 757-200F

Deutsche Post owns five airline subsidiaries operating for DHL Express, operating approx. 250
aircraft and another 21 aircraft on orders, which are collectively referred to as DHL Aviation.
DHL Express is an equal partner in a sixth airline that operates for DHL Express:

Blue Dart Aviation, Chennai, India, provides services for Indian destinations from Chennai
International Airport

DHL Aero Expreso, Panama City, Panama provides services for destinations in Central and
South America

DHL Air UK, Hounslow, United Kingdom provides services for European destinations from
East Midlands Airport

European Air Transport Leipzig, Leipzig, Germany provides services for European destinations
from Leipzig/Halle Airport

AeroLogic (joint venture with Lufthansa), Schkeuditz, Germany provides services from Europe
to central and eastern Asian destinations from Leipzig/Halle Airport and Frankfurt Airport

SNAS/DHL, Bahrain provides services for Middle East destinations from Bahrain International
Airport
Sponsorships

For several years, DHL was the primary sponsor of the Porsche RS Spyder Le Mans Prototypes
in the International Motor Sports Association American Le Mans Series. DHL also sponsors
Ryan Hunter-Reay's #28 IndyCar Series car for Andretti Autosport since 2011. With DHL,
Hunter-Reay won the championship for the 2012 IndyCar Series season as well as the 2014
Indianapolis 500. DHL were the main title sponsor of the Jordan Formula One team during 2002.
Since then, DHL has become a regular track-side sponsor at various races throughout each year,
as well as becoming the 'Official Logistics Partner' of the sport. Since 2007, they also sponsor
the DHL Fastest Lap Award for the driver that achieves the most fastest laps in a season.

Manchester United Football Club announced them as their first training kit sponsor in August
2011, agreeing to a four-year deal with DHL reported to be worth £40 million; it is believed to
be the first instance of training kit sponsorship in English football. In 2014, FC Bayern Munich
agreed to a six-year sponsorship deal with DHL. In 2012, the company became the main sponsor
of League of Ireland club Bohemian F.C.

DHL is the current title sponsor of the South African Western Cape Rugby Union teams Western
Province and the Stormers. This is came into effect on 1 January 2011 for a period of three
years.[43] DHL are still the current sponsor for both teams as of the 2017/18 season.

In 2014, the company is sponsoring, with IMG Fashion, DHL Exported, which is aimed at
"assisting designers who are already successful locally to gain momentum internationally".DHL
Exported will "sponsor a chosen designer for two consecutive seasons at" the Mercedes-Benz
Fashion Week in New York, London Fashion Week, Milan Fashion Week or Mercedes-Benz
Fashion Week Tokyo. IMG Fashion "will accept applications from February 17 through April 2
at dhlexported.com".

Expanding its support to various cultural endeavors, DHL signed as the Official Logistics partner
for Cirque du Soleil. DHL transports up to 2,000 tonnes and 80 freight containers utilizing air,
sea, and land to transport the equipment from one city to the next.

In 2015 DHL became the main sponsor of Italian volleyball club Modena Volley, covering the
whole men's SuperLega Italian championship and the CEV Champions League.
DHL is a major sponsor of Surf Life Saving Australia.

“Our top customers also need the flexibility to pick and choose from a wide range of supply
chain options……..We listen closely to our customers and work with them to provide high
quality solutions. Our customers' success is our success.”
----------Sara Arrhenius

DHL has customers cover all over the world according to Sara Arrhenius. DHL accept any kinds
of delivery requirements no matter who the clients are. According to Yunfeng Gao, DHL in
order to know customer life cycle deeply, DHL segments its customer into different groups.
According to different customer needs, customers are segmented as: strategic customer; long-
term relationship customer; and normal customer. Strategic customer is someone who has large
amounts of logistics needs or complex supply chain requires.

Usually strategic customer group is made up of top 250 customers in the world. Long-term
relationship customer is someone who asks DHL to serve for them regularly and frequently, but
their logistics needs are simpler than strategic customer. In terms of normal customer, they are
not loyal which means they can choose another 3PL company if they like. In general
understanding, DHL always provide best technology and service to strategic customer to build
strong cooperation relationship with them.

However, the main task for DHL is to focus on long-term relationship customer, in order to
achieve profit maximization. And DHL can do something for normal customer to turn them into
loyal customer. DHL measures customer satisfaction in different ways， and sometimes it even
differs between regions and countries. For example: DHL Express in Sweden has processes, i, g,
Key Performance Indicators (KPIs) to measure customer satisfaction (for instance, measuring
how fast DHL pick up the phone, first time resolution of customer query), and it can also handle
customer complaints. The compalints should be dealt with within a specified timeframe and
resolved according to agreed timings.

According to Sara Arrhenius and DHL official website, in 2011 DHL Express won customer
service award for the best B2B customer service in Sweden. However, DHL does not provide
more detail about customer satisfaction. DHL develops strong customer relationships to
understand and know customer views. By good understanding of customer, the company can
adapt the specific service to fulfill customer needs.

Usually, DHL plays the role of a dependable partner when customer needs them. The company
always finishes their service optimally due to its excellent personal approach. For instance,
according to Dirk, the customs experts of DHL see to it that customers’ goods get to their final
destination with maximum reliability. Consequently, DHL 18 generates the trust and expectation
to their customer. In addition, the Global Customer Solutions which is launched for top 100
customers also make a great contribution to company and customer to create win-win situation.
Thus, the customer’s success is DHL’s success, is put into practice.

“Attracting new customer is important, however, DHL still focuses on old customers’ need to
prevent losing those customers.” ------- Yunfeng Gao

“Customs clearance and associated services need to be fully understood – and that’s what we
do.” -------- Dirk Klasen
CHAPTER 2 :
REVIEW OF LITERATURE
Even though the academic researches that focus on traditional marketing mix constitute the
majority, in the last decade a stream of researching the topic “services marketing mix” has
emerged. Marketing mix tools hold an important place for actualizing marketing and positioning
strategies. Traditional marketing mix, 4Ps, is made up of four components namely product,
place, promotion, and price, constitute the marketing mix (Borden, 1953; McCarthy, 1964;
Aghaei et al., 2013).

In 1995, Rafiq and Ahmed extended the concept of 4Ps to 7Ps, namely product, place,
promotion, price, physical evidence, processes and people, for services industry. Marketing tools
and strategies of firms are being shaped in accordance with their positioning decisions. Hence,
management of a firm’s decisions on components of marketing mix occupy an important place
for actualizing positioning purposes. Positioning covers decisions and activities intended to
create a concept of the firms’ product in the minds of customers (FerreIl, 1997).

Lamb, Daniel, and McDaniel (2004) explains positioning as a process of developing a marketing
mix in order to influence customers’ perception of a product line, brand or organization in
general. Marketing strategies hold an important place for logistics service providers since
logistics firms play a vital for companies in gaining competitive advantage and cost efficiency,
risk-sharing, freeing up resources, and accessing to resources that are not available at one’s own
organization (Green et al., 2008).

However, there exists numerous logistics companies offering similar services. Additionally,
according to Porter's five forces of competition framework, logistics companies are in a
disadvantageous position since the industry contains high threat of entry, high intensity of
rivalry, medium level of substitution risk, medium to high level of bargaining power of buyers
and medium level of bargaining power of suppliers (Manatayev, 2004).

Hence, for logistics service providers, marketing efforts have a significant influence on
changing their disadvantageous position into a more advantageous position. In this paper, the
marketing efforts of DHL Logistics, an important player in the industry, are being analysed. 2.
Importance of Marketing Mix in Services Industry 4Ps of the marketing mix, described as “the
holy quadruple of the marketing faith written in tablets of stone” by Kent (1986), is a conceptual
framework that identifies the decisions made by managers in configuring companies’ offerings to
meet consumers’ needs (Goi, 2009).

Positioning decisions and usage of marketing mix tools constitute a byzantine. Decisions and
activities that aim to create a concept of the firm’s product/services in the minds of customers,
constitute positioning of the firm (Ferrell, 1997).

In services industry, marketing mix efforts hold an important place for positioning. As for
logistics services industry, there exists thousands of logistics companies offering similar
services. However, most of the companies prefer to work with a small number of logistics
service providers that have good brand reputation or image (Baker, 1984; Fuller et al., 1993;
Gordon, 2003; Marquardt et al., 2011). Hence, the logistics companies have begun to realize the
impact of marketing efforts.

Product (Service) Strategy

For Logistics sector, in which DHL performs, it is crucial to provide different alternatives
according to the variety of products which are to be transported. DHL Logistics aims offering
variety of service options to its customers with 5 divisions, namely DHL Express, DHL Global
Forwarding, DHL Freight, DHL Supply Chain and DHL Global Mail. DHL Express, one of the
largest air carrier of the world, offers urgent documents and goods transportation to its customers
while DHL Global Forwarding division offers air, ocean, rail and road freight options to its
customers in addition to warehousing and distribution opportunities. Freight division of the
company supplies road and rail freight with LTL (less than truck load), FTL (full truck load) and
intermodal services options and DHL Supply Chain provides warehousing, managed-transport
and value-added services.

Ultimately, DHL Global Mail division offers customized mail and B2C parcel shipments.
Customers may take advantage of standardized, traditional or specially-designed freight options.
Since DHL aims to build long-term partnerships and provide wide range of transportation
options, the company provides diverse industry sector solutions targeting different fields such as
aerospace, automotive, chemical, consumer, fashion, healthcare, retail, technology,
manufacturing and renewable energy. There also exists standardized service options;
nevertheless, they can be customized according to specific demands of the clients. Aside from
industry solutions and specially-designed programs, the firm develops flexible standardized
service options. The characteristics of the goods shipped, delivery lead times and criticality of
the freight to ultimate consumers are the main factors in service type determination.

For instance, the logistics processes of cars are different from chemicals and medications, not
only in terms of lead times but also the way of carriage and warehousing (i.e. temperature-
controlled freight, cold storage).

Price Strategy
For standardized freight services, DHL Logistics prefers implementing cost plus pricing strategy
which covers deciding on final price by adding a percentage to costs as a profit margin. In
accordance with the state of the market, if needed, DHL Logistics implements competition
pricing strategy and sets the final price in comparison with its competitors. Additionally, since
channel members set different prices for different destinations, the price of the provided
transportation service differs in accordance with the distance of the destination. For customized
services, prices are relatively high when compared with standardized transportation services
provided by the company. In other words, company implements premium pricing strategy for
specially-designed service options. Nonetheless, via special contracts, DHL offers special prices
to its loyal customers and the most important companies of the market.

Promotion Strategy
DHL usually prefers introducing its service offerings through television advertisements.
Additionally, DHL holds several sponsorship deals with some of the most exclusive worldwide
events such as Rugby World Cup, Formula 1, IMG Fashion Week, Manchester United, Barclays
Premiere League and Gewandhaus Orchestra. These sponsorships are carefully selected by DHL
with the intention of reflecting the values of the company.

For instance, the reason behind being sponsor of IMG Fashion Week is given as the relationship
between DHL’s motto “Tailor made” and fashion industry. Advertising through mass media and
traditional manners is complemented by public relations, with the purpose of generating a
positive image of a company in the market and society preferably through editorial text
(Gummesson, 2007).

In this order, DHL also shows its presence with social responsibility projects such as “Go
Green”. With slogan “Good For The Environment & Good For Business”, company strives to
provide carbon efficiency performance guideline and diminish the possible environmental harms
created by logistics industry

Place Strategy
DHL has numerous branches all around the world in addition to its own DHL Network of
Express Logistics Centers (8 DHL-operated and -managed facilities located worldwide). DHL's
"globally centralized points of distribution" increases the company’s efficiency. DHL has 850
terminals, warehouses and offices located in approximately 150 territories. Express conducts its
operations in more than 220 countries and territories with a fleet of more than 250 aircraft. DHL
Global Forwarding division provides distribution opportunity in more than 150 countries and
territories and freight division of the company offers service options in excess of 50 contries and
territories and in excess of 180 terminals.

Supply Chain divison offers services options approximately in 60 countries and territories and
has 2590 warehouses, terminals and offices all around the world. Finally, DHL Global Mail has
32 sales offices, 26 processing centers on 5 continents with direct connections in more than 200
countries. Regarding the selection criteria of distribution channel members, DHL selects channel
members based on several criteria such as service quality, costs and equipments/facilities. Some
customer freights may require special equipment and carriage. For instance, when perishable
goods such as chemicals or food are transported, shipping firms which offer cold options are
selected, or to ship hazardous materials, those airlines that have authorization of hazardous
material transportation are chosen. It can be said that the most significant expectation of DHL
from its channel members is meeting promised requirements
Physical Evidence
Components of physical layout such as odors, colors, temperature, noise level, and comfort of
furnishings may influence the perceived performance of service provider (Bitner, 1990).
Organizations operating in services industry should emphasize on physical evidence when
establishing service standards, because the tangible evidence and the attitude of the customer
specifies the ultimate quality of the service experience (Yelkur, 2000). Besides, before buying
the service, customers judge a service by the tangible clues that surround it (Yelkur, 2000).

Since corporate identity is reinforced by logos and symbols, DHL uses its widely-known logo,
red DHL writing on a yellow-colored-base, and yellow color on its trucks, packaging materials
and buildings. Moreover, company attaches great importance to the design of its website,
brochures, business cards and even invoices. They all have carefully selected designs and reflect
DHL’s brand identity with yellow logo and the name of the company written in red. For
employees working at internal operation departments, there exists no dress code due to the
reason that they are not directly communicating with customers. Since company believes that
lack of a strict dress code for these employees increase their performance, employees working at
internal operations deparments are able to dress in business casual style. However, employees
who are working at sales, opertions, and human resources departments and employees who are
involved in customer visits are obliged to obey written dress code

People
At DHL, personnel training is a very crucial aspect. Before starting to work for DHL, every
employee of DHL have to attend to the New Employee Orientation Program that aims
introducing all products of DHL to employees and developing their communication skills. In
addition to new employee orientation, all of the beginner employees are obliged to receive
training of Code of Conduct, Policy of Information Assurance, Adaptation to Competition and
Fight Against Corruption within first three months. Seperately, all employees receive trainings,
which are related with their departments, i.e. MS Office, communication techniques,
multidimensional leadership etc. Moreover, since the company uses a SAP based IT program, all
of the employees get training regarding the usage of Interalia system. It should also be noted that
additional department-based trainings are being arranged in accordance with needs of
deparments such as sales, product, customer relations and operation

Processes
Bengu Sevil Ofl ac et al. / Procedia Economics and Finance 23 ( 2015 ) 1079 – 1083 1083 DHL
pays attention to the integration of computer programs for measuring customer satisfaction and
being able to inform customers about processes. Through the medium of Soft Trans program, the
company measures duration of cargo handling. Problems regarding cargo handling are being
measured via questionnaires in certain time periods. Complaints and customer opinions are being
recorded routinely. Received complaints are being categorized according to related subtitles and
the company endeavors to develop solutions to satisfy customers’ demands as fast as possible in
order to prevent customer losses. In a similar vein, I-sell program is being used for keeping
records of customer visits and sales reports. DHL Logistics provides diversified customer service
strategies based on the type of customer.

For instance, DHL offers 7/24/365 customer service for specific industries such as aerospace
industry in which the delivery is being done within business hours. Based on the emergency,
different delivery options can be prefered by different industries. For recovering any encountered
operational problem, DHL undertakes additional costs in order to relief and maintain customer
loyalty. Every occurred problem is being recorded into the system and customers are being
informed about the solution process. Through this system, they can track the status of the freight
or the stage of solution process. Even it’s a customer’s fault, DHL tries to solve the problem as
soon as possible with the lowest additional cost reflected to the customer. If a problem occurs
after DHL delivers its clients’ freight to the air freight service provider, company opens a claim
and for any occurred damage or loss, legal process that is stated in the back of the bill of lading
is followed with the carrier.
CHAPTER 3 :
RESEARCH METHODOLOGY
Methodology
In this thesis, the literature review and empirical work on DHL are carried out. In the theoretical
framework part, the valuable theories and literature regarding external and internal analysis are
found to fulfil the purpose of the thesis work. On the other hand, the empirical data collection is
mainly based on interview. Furthermore, the company report and official website are regarded as
additional sources to gather more information. Overall, analysis of information from empirical
interviews and literature are used to answer the research questions. In this paper, a case-study
approach is implemented in order to analyse services marketing mix efforts of a global logistics
service provider, Deutsche Post DHL. Using a combination of semi-structured interviews and
secondary data analysis enabled us to actualize the aim of uncovering taken actions and decisions
regarding to services marketing mix. Five semi-constructed interviews were done with DHL
Logistics’ executives and employees including air freight supervisor, sales territory manager,
global air commercial center specialist, corporate communication manager and human resource
specialist. Each interview lasted around 40 minutes. The interviews were done by two of the
researchers and the themes of the interviews were determined as positioning, brand image,
pricing, service quality, promotion, service attributes, service processes, place-service supply
chain, physical evidence and people. As for the secondary data analysis, DHL marketing reports
were analyzed.

RESEARCH METHODOLOGY

Research Methodology is a systematic way, which consists of series of actions or steps necessary
to effectively carry out research and the desired sequencing of these steps. The marketing
research is a process of involves a number of inter-related activities, which overlap and do
rigidly follow a particular sequence.
It consists of the following steps
1. For DHL the objective of the study
2. Designing the methods of data collection
3. Selecting the sample plan
4. Collecting the data
5. Processing and analyzing the data
6. Reporting the findings

RESEARCH DESIGN

Research Design specifies the methods and procedures for conducting a particular study. A
Research Design is the arrangement of conditions for collection and analysis of the data in a
manner that aims to combine relevance to the research purpose with economy in procedure.
Research Design is broadly classified into two types as

 Exploratory Research Design

 Descriptive Research Design

On the basis of the objective of study, the studies which are concerned with describing the
characteristics of a particular individual, or of a group of individual under study comes under
Descriptive Research Design. Descriptive Research Design In this research design the objective
of study is clearly defined and has accurate method of measurement with a clear cut definition of
population which is to be studied. Research problem
Two steps are involved in the research problem:

 Understanding the problem

 Rephrasing the problem into meaningful terms from an analytical point of view
CHAPTER 4 :
DATA COLLECTION
Qualitative Method
This study descirbes marketing strategy of a logistic company. The aim of this thesis is neither
to formulate hypothesis from the conceptual work nor to test developed hypothesis by generating
the necessary data, the qualitative method is mainly used to describe and analysis qualities,
attributes and make distinctions (Punch, 2005). Generally, qualitative method addresses the
explanation of non-numerical data. There are several methods can be adapted to collect
qualitative information, for instance, structured interview, reflexive journals, analysis of
documents and materials and the like (Walliman, 2005). The qualitative method is used as the
research method in this thesis to discuss competitive advantage of DHL.

Data collection
An important basis for successful research is information in the form of facts. These facts can be
called data and are the ones that allow the researcher to understand the problem under that is
being investigated (Walliman, 2005). In order to conduct a relevant research both primary and
secondary data were gathered. Secondary data was obtained from scientific articles, relevant
books and Internet sources.

Primary data
Primary data is information that has not previously been published or collected. Walliman (2001)
addressed that “primary data, that is data observed, experienced or recorded closet to the event,
are the nearest one can get to the truth, distortions inevitably occur as the proximity to the event
decreases.” The data would be much more reliable by directly collecting by the researcher.

The primary data was obtained in the form of the answers to a list of questions from the Head of
Marketing Communication of DHL Express. The purpose of conducting this interview was to
collect the practical information on the marketing strategy of DHL. There were 25 questions
covering the wide range of DHL practices: DHL’s customer, DHL’s competitor, DHL
environmental strategy, DHL brand association, and DHL quality of service. The data from
collected from various heads in the marketing department regarding their work and contribution
in making DHL the fastest delivery service providing company.
Some information is also collected from the internet and various published research papers.

Secondary data

Contrast to primary data, secondary data is that have been collected or published previously. This
type of data is the most common type encountered since it consists all types of written 14
materials such as: magazines, books and internet. The DHL official website have been the valued
secondary source to replenish DHL brand association. In addition, by reading through DHL
transportation introduction (such as DHL air freight service, DHL road & rail service, and DHL
ocean freight service), the quality of DHL’s service can be analyzed. In terms of environmental
issue, DHL Supply Chain GOGREEN 2011 report helps authors gather DHL environmental
information. In order to get DHL competitors’ information, the authors also use some useful
information from UPS official website and FedEx official website.
Limitation of the project :

 Lack of proper research and detailed information about the company and its operating
activities.
 The time frame to perform an internship was short.
 Lack of knowledge to run programs and software used by DP Sign.
 Object-oriented based programming and use of different programming languages in DP
Sign stopped me to learn more.
CHAPTER 5 :
DATA ANALYSIS
Analysis
The results of empirical finding and the theory discussed are combined and linked together, to
find out the connection between them. The SWOT matrix would be taken up to present the
results of analysis in the end.

DHL customer analysis:

DHL customer is everywhere, and anyone can be DHL’s customer if there is something to
deliver. It also reflects the application of DHL, With a global network composed of more than
220 countries and territories and 285,000 employees worldwide, customers can call DHL for
help anywhere. DHL segments it customer into different group, it helps manager understand
more about marketing and service innovation. Customer segmentation also provide chance to
offer specific services to customers based on their needs. DHL is trying to be the best all the
time, what DHL expects is to solve problem before it occurs.

Regarding identification of motivation, the good brand reputation; safety insurance; acceptable
price make DHL become No. 1 in the industry and helps to keep its dominant position. Thus, by
considering the leading position of industry, it is supposed to be the main reason why people like
to choose DHL instead of other brands. Determining the relative importance of the motivations,
according to Sara Arrhenius & DHL official website, DHL is good at listening to customer.
Moreover, DHL is proud of its short delivery time, and safety issue etc. These factors attract
more and more people become DHL’s loyal customer.

Besides, DHL customer satisfaction was very high in 2011, DHL Express won customer service
award for the best B2B customer service in Sweden. It indicates that customer trust DHL.
According to Bergman & Klefsjö (2010), credibility is completed. Therefore, how well the
service it is might be the most important factor customer care about. Generally, many companies
and organizations pay a lot of attention on new customers. Menwhile, thery care less about old
customers.

However, DHL is aware of the importance of old customers. Those old customers have close
relationship with company’s revenue, further keeping old customers can build long-term
business, and reduce costs to seek for new customers. According to Yunfeng Gao, how to keep
customer with company has become a significant part of company’s business strategy.
Unfortunately, there is no information to indicate if DHL has any unmet needs, and authors did
not find it due to the site manager’s inability to provide us an interview. However, unmet needs
of DHL can be a topic in further study.
 By long term cooperation with customer or another company, DHL has gained the No.1 in the
industry. It also makes customer happy, which means customer is glad to be with DHL in daily
life. Without trust, this situation is impossible to happen.

DHL competitor analysis :

Gerhardt (2002) states that understanding competitor is a significant approach to win market
share. In terms of total number of employee, UPS has an absolute advantage. UPS can exploit
the rich human resource to accomplish more tasks than other three do. On the contrary, the large
number of workforce might increase the cost directly. And UPS was founded earliest, which
means it should have more working experience than other two companies. Regarding verification
of insurance, even though UPS and FedEx have complete liability insurance, DHL still be No.1
in the industry. Thanks to the new security equipment and latest technology, DHL gains
customer satisfaction, even customer loyalty.

However, DHL should learn something from its competitors to become more perfect, perhaps it
is an opportunity to attract potential customer more or less. One typical example is liability
insurance, otherwise it must be a huge weakness for DHL. In terms of service, UPS critical
freight focuses on time-critical freight needs. The benefits of critical freight are: expedited
transportation can be arranged based on customer time-critical freight shipment needs; it ensures
real-time shipment tracking from pickup to delivery; and Identification of Motivation, Good
reputation, Safety insurance, Assessment of Motivation, Nice service, Safety insurance Unmet
needs .

Further study develop customized solutions to meet special transportation. TNT is trusted by
many enterprises, because TNT establishes exclusive service for enterprise, such as Express
Shipper, and Express Manager. FedEx can design a special package for customer’s high-tech
items , it provides the safety of goods during delivery time. Such service can make customer
happy and enable shipping easier. Besides, according to Yunfeng Gao, DHL should pay more
attention on U.S and South America marketing. Because UPS and FedEx do better than DHL. A
significant trend or event, such as concern about the emergence of a new competitor, can
dramatically affect the evaluation of strategy options. DHL should be aware of it.

Moreover, a new technology, which can represent both a threat to an established firm and an
opportunity to a prospective competitor, can signal new business arenas. Therefore, it is very
necessary for DHL to make innovation about its service. Otherwise the leading position in the
industry would be lost sooner or later. All four companies focus on environment impact through
respective sustainability policy. They do their upmost to reduce environmental negative impact,
at the same time they make significant contributions to the environmental sustainability in the
industry. Regarding subsidiaries of DHL, UPS and FedEx, the subsidiaries enable service be
more efficient. It also response to customer’s different needs in a sense. In addition, according to
Lieb (2005) emphasizes that 3PL relationships today have become more collaborative.

In authors own opinion, in order to achieve the mutual target, sometime the cooperation between
competitor is essential. For example, the different 3PL companies can work together due to large
procurement or something like that. These companies can sharing knowledge, experience and
skills during cooperation. Besides, no company can be successful without a tough competitor.

DHL environment analysis

According to Deutsche Post DHL, GOGREEN program is a sustainable strategy of DHL, it
deals with any environmental issues friendly and harmoniously during service time. There is no
doubt that every company or organization concerning leave some impacts to environment
whatever is good or bad, especially CO2, but GOGREEN has ability to control negative impact
and reduce it in some way. As mentioned before, DHL owns a professional group DHL in-house
Carbon Management team to manage the carbon credits, and besides the team is monitored by
third party verifier.

DHL totally follows and tries to achieve GOGREEN 33 objectives so that transparency on
environmental impact, with a focus on DHL’s carbon footprint including subcontracted
transportation is available. Regarding the improvement of operational efficiency and decrease
our environmental impact, DHL environmental management systems (EMS) is used to deal with
it. In order to reduce its environmental impact, DHL is testing electric and other alternative
vehicles as new generation delivery tools which can lead to the replacement of the traditional
energy. By deploying new technology or new resource, the environmental damage would be
reduced efficiently. DHL Supply Chain GOGREEN 2011 also indicates that collaboration with
leading automotive manufacturers has achieved great progress, particularly for fuel savings.

Therefore, generally the company would like to provide such sustainable approach or
GOGREEN to its customer, because it cannot only satisfy customer but also generate great
values to environment. Awareness of the employees about environment is made by the training
of DHL so that employees put environmental goals into practice. The education is very vital to
the company itself even to the entire society, an appropriate training can give people a right
guide of life. DHL is doing a good job on environment friendly issue which means employee
knowledge is strengthened. It offers opportunity to its employees to learn how important the
environment is and how to protect it from pollution in DHL way. It is necessary to consider if
DHL has enough awareness or power to face sustainability challenge. DHL is always trying to
provide a best delivery solution to customers and environment, sometimes it is difficult to
balance them at a same time. However GOGREEN can do it. Business customers can choose to
send all or a selection of their international express shipments as GOGREEN with competitive
price. With the GOGREEN optional service, all transport-related emissions of carbon dioxide
would be offset through external climate protection projects. Therefore, balancing sustainability
effort 34 business area, including those DHL’s subcontractors.

By implementing GOGREEN program, it is obvious and reasonable to judge that DHL always
pays a lot of attention on environmental protection and sustainability issue. Basically these issues
can get priority; it means environmental protection would be concerned firstly. For instance,
DHL continuously strive to improve CO2 efficiency in its own networks and operations even
DHL and its customer have already got benefit by implementing GOGREEN. As one of biggest
3PL companies, DHL always focus to reduce its environmental effect as little as possible. Unlike
many other Chinese domestic company, which seeks for economic compensation but ignore
environment problem (Koh, 2005). DHL offers current and potential employees opportunities to
develop professionally. It provides knowledge or information of current environmental practices
to increase employees’ environmental awareness. In this way DHL can increase sensitivity to
sustainability and reduce cost.

Thus, the awareness and ideology of environment friendliness is emphasized throughout the
entire DHL. It means that DHL is probably capable to deal with kinds of environmental or
ecological problem relating to business area（see Figure 10）. Figure 10 DHL and sustainability
challenges Source from authors own Identify an appropriate environment al target Balancing
sustainability efforts with customer expectation Developing organizational sensitivity to
sustainability issues Generating accurate company information related to environment al practice
Establishing sustainability priorities with the company

DHL quality of service

As a famous 3PL company in the world, the main product of DHL is delivery service. Therefore
different transportation tools are very important to DHL and its customers. Generally, delivery
service always links with some issues such as safety, environmental impact, durability, and
reliability. The customers are concerned and asked about these factors frequently. According to
DHL official website, DHL owns diverse software and hardware to support that identification,
The hi-tech can be one of DHL strengths. Moreover, more than 7,000 specialists in the world are
preparing for providing professional service to its customers. Unlike many other freight insurers,
DHL measures according to value, rather than weight or package count.

Therefore no matter in air, sea or on land, DHL is able to make sure the security of goods and
mails. DHL tries to satisfy each customer’s demand or needs as best as it can. Thus safety and
durability which are two factors which customers care about should be focused on mainly by
company. In order to let the whole delivery process be smooth without any accident completely,
every year the company invest billions of Euros to ensure the security of goods and mails by new
security equipment or latest technology. In addition, there is a easy way to contact with DHL
through DHL official website, and all the staffs are willing to help customers. Then according to
Bergman & Klefsjö (2010), the communication, responsiveness and access can be achieved.
Even through DHL can offer best service to customer. But the biggest problem is about price.
The expensive price must cause customer loss.

Additional, DHL should develop U.S and South America marketing by improving staff’s skill,
attitude, knowledge. However, it is not available to find any information about DHL customer
complaint, it is an unknown area that will affect the outcome of strategic decisions. Thus,
customer complaint can be regarded as one strategic uncertainty. In order to control customer
complaint, the information collection is essential. According to Baker (2001), the strategy-
developing scenarios can be made. For instance, DHL can establish a department to take charge
of complaint. In such way company can create contingency plan to guard against disaster, to
prevent customer dissatisfaction. 36 In terms of the quality of service.

DHL should keep developing its assessment mechanism; making research about customer
satisfaction regularly; being aware of the change of market. 5.5 DHL brand association
According to Sara Arrhenius and Dirk Klasen, DHL provides reliable, innovative service and
solution to its customers. According to Heding et al (2008), corporate identity is “an assembly of
visual, physical or behavioral cues representing the company, making it immediately
recognizable to consumers.” Thus “Customers must be able to immediately recognize us
wherever they see us” , it indicates that the logo of DHL is quite unique, which means it catches
people’s eyes at first sight and leave significant impression to people.

However, in a dynamic marketing it is hard to predict what would show up in further time, the
current challenge for DHL is to keep the leading position and continue attracting more and more
potential customers. Moreover, the high price also leaves negative influence on DHL brand. In
such dynamic market, customers would prefer cheaper service which they afford to pay. If DHL
can control its cost with an accepted price, it can gain more benefits. By linking the leading
position in the industry and customer feedback, the image of company is rather good from
outside looking.

According to Nadin & Williams (2012), employee can affect on brand association as well. In
2010, 73 % of the employees who responded said that they were generally satisfied with their
tasks. In terms of the system of organization which Yunfeng Gao mentioned before, it consists of
leadership, organization structure and working system. According to Yunfeng Gao, he told that
his superior is good and charming. The working atmosphere usually depends on the way leader
uses, from our own opinion. The personality charm can always make people come together.
Regarding working system, every man needs time to adapt it at the beginning. DHL’s working
system is effective, but sometimes it is too strict. Perhaps a strict working system is essential for
such successful company. And DHL is made of four departments, each department has
respective vision, strategy and service.
 It is effective to assign task and focus on different target for each. A good training program
offers DHL employee opportunities to develop themselves, and further encourages them to
become more active to contribute their knowledge and skills to the success of company. Key
Performance Indicators (KPIs) is used to estimate employees’ 37 absences, health and
occupational safety, employee turnover, vocational training, etc

SWOT ANALYSIS OF DHL

Strengths of DHL – Internal Strategic Factors

As one of the leading firms in its industry, DHL has numerous strengths that enable it to thrive in
the market place. These strengths not only help it to protect the market share in existing markets
but also help in penetrating new markets. Based on Fern Fort University extensive research –
some of the strengths of DHL are –

1. High level of customer satisfaction – the company with its dedicated customer relationship
management department has able to achieve a high level of customer satisfaction among present
customers and good brand equity among the potential customers.

2. Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the
company to overcome any supply chain bottlenecks.

3. Successful track record of developing new products – product innovation.Automation of

activities brought consistency of quality to DHL products and has enabled the company to scale
up and scale down based on the demand conditions in the market.

4. Highly skilled workforce through successful training and learning programs. DHL is investing
huge resources in training and development of its employees resulting in a workforce that is not
only highly skilled but also motivated to achieve more.

5. Strong Brand Portfolio – Over the years DHL has invested in building a strong brand
portfolio. The SWOT analysis of DHL just underlines this fact. This brand portfolio can be
extremely useful if the organization wants to expand into new product categories.

6. Strong Free Cash Flow – DHL has strong free cash flows that provide resources in the hand of
the company to expand into new projects.

7. Good Returns on Capital Expenditure – DHL is relatively successful at execution of new

projects and generated good returns on capital expenditure by building new revenue streams.
Weakness of DHL – Internal Strategic Factors

Weakness are the areas where DHL can improve upon. Strategy is about making choices and
weakness are the areas where a company can improve using SWOT analysis and build on its
competitive advantage and strategic positioning.

1. The marketing of the products left a lot to be desired. Even though the product is a success in
terms of sale but its positioning and unique selling proposition is not clearly defined which can
lead to the attacks in this segment from the competitors.

2. Not highly successful at integrating firms with different work culture. As mentioned earlier
even though DHL is successful at integrating small companies it has its share of failure to merge
firms that have different work culture.

3. Financial planning is not done properly and efficiently. The current asset ratio and liquid asset
ratios suggest that the company can use the cash more efficiently than what it is doing at present.

4. There are gaps in the product range sold by the company. This lack of choice can give a new
competitor a foothold in the market.

5. Not very good at product demand forecasting leading to higher rate of missed opportunities
compare to its competitors. One of the reason why the days inventory is high compare to its
competitors is that DHL is not very good at demand forecasting thus end up keeping higher
inventory both in-house and in channel.

6. The company has not being able to tackle the challenges present by the new entrants in the
segment and has lost small market share in the niche categories. DHL has to build internal
feedback mechanism directly from sales team on ground to counter these challenges.

7. Days inventory is high compare to the competitors – making the company raise more capital
to invest in the channel. This can impact the long term growth of DHL.

Opportunities for DHL – External Strategic Factors

1. The new technology provides an opportunity to DHL to practices differentiated pricing

strategy in the new market. It will enable the firm to maintain its loyal customers with great
service and lure new customers through other value oriented propositions.

2. Stable free cash flow provides opportunities to invest in adjacent product segments. With more
cash in bank the company can invest in new technologies as well as in new products segments.
This should open a window of opportunity for DHL in other product categories.
3. Decreasing cost of transportation because of lower shipping prices can also bring down the
cost of DHL’s products thus providing an opportunity to the company - either to boost its
profitability or pass on the benefits to the customers to gain market share.

4. The market development will lead to dilution of competitor’s advantage and enable DHL to
increase its competitiveness compare to the other competitors.

5. Economic uptick and increase in customer spending, after years of recession and slow growth
rate in the industry, is an opportunity for DHL to capture new customers and increase its market
share.

6. Government green drive also opens an opportunity for procurement of DHL products by the
state as well as federal government contractors.

7. Organization’s core competencies can be a success in similar other products field. A

comparative example could be - GE healthcare research helped it in developing better Oil
drilling machines.

8. New trends in the consumer behavior can open up new market for the DHL . It provides a
great opportunity for the organization to build new revenue streams and diversify into new
product categories too.

Threats DHL Facing - External Strategic Factors

1. No regular supply of innovative products – Over the years the company has developed
numerous products but those are often response to the development by other players. Secondly
the supply of new products is not regular thus leading to high and low swings in the sales number
over period of time.

2. Rising pay level especially movements such as $15 an hour and increasing prices in the China
can lead to serious pressure on profitability of DHL

3. Liability laws in different countries are different and DHL may be exposed to various liability
claims given change in policies in those markets.

4. Changing consumer buying behavior from online channel could be a threat to the existing
physical infrastructure driven supply chain model.

5. The demand of the highly profitable products is seasonal in nature and any unlikely event
during the peak season may impact the profitability of the company in short to medium term.

6. As the company is operating in numerous countries it is exposed to currency fluctuations

especially given the volatile political climate in number of markets across the world.
7. Increasing trend toward isolationism in the American economy can lead to similar reaction
from other government thus negatively impacting the international sales.

8. Intense competition – Stable profitability has increased the number of players in the industry
over last two years which has put downward pressure on not only profitability but also on overall
sales.

Limitations of SWOT Analysis for DHL

Although the SWOT analysis is widely used as a strategic planning tool, the analysis does have
its share of limitations.

Certain capabilities or factors of an organization can be both a strength and weakness at the same
time. This is one of the major limitations of SWOT analysis . For example changing
environmental regulations can be both a threat to company it can also be an opportunity in a
sense that it will enable the company to be on a level playing field or at advantage to competitors
if it able to develop the products faster than the competitors.

SWOT does not show how to achieve a competitive advantage, so it must not be an end in itself.

The matrix is only a starting point for a discussion on how proposed strategies could be
implemented. It provided an evaluation window but not an implementation plan based on
strategic competitiveness of DHL

SWOT is a static assessment - analysis of status quo with few prospective changes. As
circumstances, capabilities, threats, and strategies change, the dynamics of a competitive
environment may not be revealed in a single matrix.

SWOT analysis may lead the firm to overemphasize a single internal or external factor in
formulating strategies. There are interrelationships among the key internal and external factors
that SWOT does not reveal that may be important in devising strategies.
CHAPTER 6 :
FINDINGS AND SUGGESTIONS
Findings

In this project, the authors present the empiric information of DHL. SWOT analysis is used for
analyzing external and internal factors of DHL. The strength and opportunities are regarded as
the company’s competitive advantages; on the other hand, weakness and threats are discussed as
competitive disadvantages.

RQ1: What competitive advantages does DHL gain from external and internal factors?

By analyzing external and internal factors, it is found that the competitive advantages of DHL
are related to customer satisfaction, hi-tech transportation service and sustainable program-
GOGREEN. The long-term relationship with customer brings win-win situation to both parties,
which means DHL makes customer feel safe and happy, meanwhile customer gives opportunity
to DHL to earn economic benefits.

Hi-tech service seems to attract more and more potential customers. And all transport-related
emissions of carbon dioxide would be reduced through DHL GOGREEN, it is an excellent green
program to protect environment. Moreover, GOGREEN can be a typical demonstration for future
generation, how we minimize environment effect in 3PL industry. Besides, if DHL can learn
something complementary from other companies, or improve teamwork spirits it must be more
another important competitive advantage. The level of salary makes employees feel comfortable
and makes good staffs stay with DHL.

According to Yunfeng Gao, theoretically, 3PL industries own many advantages than traditional
industry, such as: skillful staffs, high-tech equipments, and complex distribution network.
Consequently, these advantages make the cost low, improve efficiency, and high level of service.
Thus, the company would be more competitive .

RQ2: What competitive disadvantage does DHL have? And what DHL can learn from analyzing
competitive disadvantage?

DHL lacks complete liability insurance which might lead to customer loss.
Suggestions

 DHL should establish a complete liability insurance system as soon as possible. And, the
fewer employees might also cause efficiency problem, it could leave bad impact on
employees’ health because of a lot of jobs. Further recruitment may be another good
option to solve such problem. But the manager should also care about employees’
physical and mental health more actively. Regarding price issue
 DHL must deal with a cheaper brand identity as 42 soon as possible.
 DHL can make discount for customer to inspire sustainable business. Providing more
reward or honor to employee who act excellently may stimulate employee to work hard.
In such dynamic marketing environment
 DHL should keep making surprise to its customer and even to its competitor.
 DHL should invest more on R&D, and consummate service in order to defend its leading
position.
CHAPTER 7 :
CONCLUSION
Conclusion

The way in which DHL’s hierarchy is set out is suited to the nature of the logistics industry.
Information can be cascaded down quickly and efficiently, before eventually falling into the
hands of those to whom it is relevant, saving time. For example, it is no use for the sales team to
be briefed on a large shipment coming. Internally, mobile phones act as a good link between
managers in the warehouse and couriers. These work well as drivers are able to be redirected as
soon as managers know there is a problem. One point that could be improved however is for
couriers to contact each other so they do not have to go through the manager. Mobile phones also
allow for the couriers to contact managers to warn of any uncharacteristically large pick-ups, so
the warehouse staff can then make room for them. In offices, the use of an internal e-mail system
means that any member of staff can be searched for in a company address book. This allows for
users to quickly find an address for somebody they need to contact in order to save time. The
feedback I have gained is that this system works well and is easy to operate. Also, this ensures
that there is no mistranslation of the original message as there might be if phones had to be used.
However, there is no way to e-mail more than one level up the hierarchy, something that could
be looked at.

One way that internal communications could perhaps be improved, is for lower levels of staff to
be given more information on how the service centre is operating. Despite being given plenty of
information on schemes used by DHL on the canteen wall and on the board, performance figures
are not openly published. Staff may feel more immersed in the company, feel a sense of pride,
and more importantly, trust what the managers are doing if they had such insight.

Externally, DHL have found a very cost-efficient way to advertise. Despite FedEx running
regular TV campaigns, DHL are arguably as well known a company (in Europe) and they use
this brand awareness to their advantage. Although effective, this method does not give DHL
much of a personality. People are well aware of the brand, but may not have much idea of what it
stands for. On the other hand however, this lack of personality could work to DHL’s advantage
as there is no scope for any message the company transmits to be distorted. The adverts on the
vans merely describe services and cannot be perceived in different ways by different people.
DHL have used sponsorship cleverly to cover for this lack of personality, as they have been able
to control the image portrayed by them, using the events they sponsor.

Overall, DHL Express has a very efficient and well-run hierarchy, with clear paths for messages
to run through. The messages and images promoted internally and externally are very closely
aligned. DHL has been successful in creating an identity that has been transferred to a public
image. This is undoubtedly a major reason for their success in the market.
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