DHL's growth and market position in international courier services

DHL

The history of international courier service DHL is important, but only brief history is necessary here. DHL began in San Francisco, but it spread rapidly and now covers 220 countries (History, 2004). Recently, it merged with Airborne Express, so now it covers both domestic and international shipping (History, 2004). Worldwide, DHL services 3 (History, 2004).5 million customers and over 120,000 destinations with over 170,000 employees (History, 2004). It has now been in business for 34 years, which is a relatively short time to grow into the large company that it is today (History, 2004). It was founded in 1969 by Adrian Dalsey, Larry Hillblom, and Robert Lynn (History, 2004). The first letters of their last names combined to make the company name - DHL (History, 2004).

Originally it sent bills of lading between Honolulu and San Francisco (History, 2004). In only a few years it was also servicing Australia, Japan, Hong Kong, Singapore, and the Philippines (History, 2004). In the 1970s DHL also moved into Europe, Africa, the Middle East, and Latin America (History, 2004). It was also the first company to bring Air Express to the countries in the Eastern Bloc beginning in 1983, and the People's Republic of China by 1986 (History, 2004). Trade is becoming much more global, and the rapid growth of DHL reflects that (History, 2004). Most of the DHL offices throughout the world are owned by the company, and those that are not are owned by affiliates that DHL works closely with (History, 2004). Were it not for the rapid expansion of globalization when it comes to business, DHL would likely not have grown so rapidly or done so well.

Finance Status

Financially, DHL appears to be performing well. DHL is a subsidiary of Deutsche Post, and leads the world in express delivery around the globe (Yahoo! Finance, 2004). It is ahead of FedEx and UPS and provides not only freight forwarding services but logistics as well (Yahoo! Finance, 2004). Airborne Express was acquired in 2003 so that DHL would have a ground unit, and this only made the company larger and more powerful when it comes to deliveries around the world (Yahoo! Finance, 2004). In 2003, DHL had 160, 754 employees, which was a 1-year growth of 5.60% (Yahoo! Finance, 2004). Revenue for the 2003 fiscal year was 27570.50 million, which indicated a growth rate of almost 30% (Yahoo! Finance, 2004).

Driving Factors

One of the reasons that DHL does so well is that much of the business it gets would have otherwise been handled by the Post Office (Wessel, 1995). Because the postal service has been somewhat privatized recently, however, much of the business that would have gone to it has gone to other carriers. DHL is not the only one, but they are capable of sending packages to areas of the world that the other carriers are not involved in. They are following in the footsteps of UPS and FedEx by signing an agreement with 1200 independent parcel and mail centers (DHL, 2004).

They are fast, but this is not the main reason that they do so well. Instead, it has to do with the diversity that they have and the fight that they are willing to keep up when they feel that they are being pushed out of the marketplace by UPS and FedEx (DHL Worldwide, 2004). Not only can that send something just about anywhere in the world very quickly, but they are also there for logistical advice and helping their customers to do the best business possible. This is evidenced by the many awards that DHL has won in various Asian countries for advertising, innovation, and operations (DHL Scoops, 2002).

Many of the other 'courier services' simply send packages, without and advice as to how the business in question could save money, or whether a certain kind of shipping would be beneficial. It is this targeted customer service and the ability to send to so many different places across the world that sets DHL apart from its competition. The battle for gaining ground against UPS and FedEx in some areas, however, is just getting started (DHL: Once, 2004).