|Name||DHL International GmbH|
|CEO||Dr. Frank Appel|
|Revenues||€ 76.12 Billion, 2021|
|Profit||€ 3,40 Billion, 2021|
|Competitors||FedEx, TNT, Neovia Logistics, UPS, Royal Mail|
Headquartered in Bonn, Germany, DHL was founded by Robert Lynn, Adrian Dalsey, and Larry Hillblom in 1969. DHL is a leading multinational courier, package delivery, and express mail service provider. According to DHL (2021), DHL delivers more than 1.6 billion parcels annually. Currently, it is operating in over 220 countries and territories with the help of 400,000 employees, allowing it to provide services across borders. As per Yahoo Finance (2021), it has a market capitalization of € 65.37 billion, showing that the company is having a large market share in the delivery and logistics sector.
Table of Contents
DHL Strengths 2021:
- Worldwide Coverage.
DHL is a leading multinational brand with strong global coverage in the international logistics market. According to DHL (2021), DHL is currently working in more than 220 countries all across the world. Around 49 million letters are delivered every day to the customers. This shows that DHL is successful to cover a major portion of the market share due to its worldwide coverage.
- Technological Innovations.
DHL is heavily involved in making technological innovations over the introduction of advanced technologies in the market. In 2021, DHL has launched a new service that enables retailers to expand their online presence by expanding into a wide range of items, such as kitchens, beds, and furniture. It will allow consumers to get the same home delivery services just like other suppliers, to ensure a satisfactory brand experience DHL (2021a). In addition to this, in 2019, DHL also launched a central procurement system and e-procurement, allowing people to buy and sell supplies online (PostandParcel, 2019).
- Strong Brand Value.
DHL has a strong brand repute in the international market. According to Interbrand (2020), the brand value of DHL was estimated at $6.29 billion in 2020, with the 81st ranking in the Best Global brands 2020. Moreover, based on Fortune (2021), DHL is ranked 113 among the Global 500 brands with an $85 billion market value.
- Excellent Financial Position.
DHL holds a strong financial position with an ample amount of resources to back up its operations. DHL has a gross profit margin of 51.4% and net profit margins of 4.3% in 2020 (Macrotrends, 2021), showing that the company has a good financial position. Moreover, its current ratio has increased from 0.89 to 1.1 in 2020 (Macrotrends, 2021), showing that it is now capable to meet its liabilities in a better way.
DHL Weaknesses 2021:
- Weak Marketing Strategies.
Unlike its rivals, such as UPS or FedEx, DHL has poor marketing and advertising tactics. It does not put a lot of money into branding, which has an impact on brand acceptability and appeal. Therefore, DHL needs to give focus on improving its marketing strategies.
- Dependence on External Collaborations.
Although DHL is a multinational company with a strong market presence globally, it has to collaborate with local private agencies or companies to operate on gross levels, which does not provide full control to the DHL on the services provided to the customers. Therefore it affects the overall efficiency and repute of the brand, leading to lower sales.
- Multiple Regulatory Compliance.
DHL operates in a variety of countries, leading to the compliance of multiple regulatory requirements to operate in a specific country. This puts difficulty on the DHL to follow different laws and fulfill different requirements to run its operations. In case of any new sanctions in a country, DHL revises its operational plans, accordingly, which put extra cost and effort (DHL, 2021b).
DHL Opportunities 2021:
- Collaboration with Chinese Company.
China is considered an ocean of opportunities for any business. DHL has recently announced a partnership with Shopee, a leading Chinese e-commerce platform, in order to allow Chinese sellers to access worldwide consumers (DHL, 2018). Therefore, DHL has become the largest express mail service company in China, contributing a significant amount of revenue to the total revenue.
- Global Expansion.
DHL is currently operating in above 220 countries all across the world, but the company has the potential to further expand its services to the small cities of these countries. DHL can build mail centres, postal boxes, and parcel centres, in order to increase its market share. According to IMARC (2021), the global logistics market has reached US$ 5.2 trillion in 2020, which is expected to further grow by 4.6% by 2026, which provides a huge opportunity for DHL for expansion.
DHL Threats 2021:
- Highly Competitive Market.
The global logistics sector is highly competitive, forcing companies to fight for gaining and retaining their market share. According to BixVibe (2021), DHL (Deutsche Post) has managed to contribute 21.7% of the global revenue earned by the logistics company, by being on the second number. While other companies, such as UPS and FedEx are also holding higher shares, 23.2% and 21.2%, respectively, which may cause a threat to DHL in expanding its sales in the future.
- Growing Electronic Communication Means.
Owing to the latest technological advancements for communication, traditional services, such as posts and letters have faced a significant downturn. People now prefer to use emails or social media platforms to send their messages and even send electronic cards to their loved ones, rather than using traditional methods, due to its free-of-cost and fast service.
DHL SWOT Analysis Conclusion:
As a whole, DHL is a leading logistics brand, operating in more than 220 countries of the world with a huge number of employees. DHL has recently become a market leader in the vast Chinese market, which has further strengthened its financial position, including sales and overall profits. But the huge competition from rivals, such as FedEx and UPS is a constant threat to the market share of DHL because they have better market strategies and global coverage. While DHL can expand into other countries and adopt effective marketing strategies to attract more customers.
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- BixVibe, 2021. Top 10 Largest Logistics Companies in the World 2020, Logistics Industry Factsheet.
- DHL, 2018. DHL AND SHOPEE LAUNCH NEW PARTNERSHIP, ENABLING CHINA SELLERS TO EASILY ACCESS THAI CONSUMERS.
- DHL, 2021a. DHL LAUNCHES SUPPLIER DIRECT FULFILMENT FOR RETAIL SECTOR.
- DHL, 2021b. TACKLING SANCTIONS: HOW DHL EXPRESS NAVIGATES LEGAL, REGULATORY FRAMEWORKS.
- DHL, 2021. DHL. LOGISTICS FOR THE CONNECTED AGE.
- Fortune, 2021. Global 500.
- IMARC, 2021. Logistics Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2021-2026.
- Interbrand, 2020. Best Global Brands.
- Macrotrends, 2021. Deutsche Post AG Financial Ratios for Analysis 2010-2021 | DPSGY.
- PostandParcel, 2019. DHL LAUNCHES INTEGRATED PROCUREMENT OUTSOURCING TO HELP GOVERNMENTS.
- Yahoo Finance, 2021. Deutsche Post AG (DPW.DE).