Deutsche Post DHL’s (DPDHL’s) dedicated ecommerce logistics arm is starting operations in India, two people in the know said, as a booming online retail industry, the implementation of goods and services tax and the recently given infrastructure status to the logistics industry promise massive growth potential.
DHL eCommerce, which has made investments in India since 2014 through parent DPDHL’s Blue Dart Express subsidiary, will now have its own presence here.
“DHL eCommerce is actively hiring for the top management in its planned India team. The CEO has been hired. Another 4-5 positions have been filled. The company aims to launch its India operations by March,” one of the people said. It hired Reliance Jio Infocomm’s former chief marketing officer, Neeraj Bansal, as the local chief executive. Before Reliance Jio, Bansal was regional sales head at Google. Most recently, he was managing director of India and South Asia at AdParlor. “In India, DHL eCommerce will work with Blue Dart rather than competing with it. There is enough space and segments in the ecommerce industry for them to coexist,” said another person. Both people insisted anonymity.
DHL eCommerce, which has made investments in India since 2014 through parent DPDHL’s Blue Dart Express subsidiary, will now have its own presence here.
“DHL eCommerce is actively hiring for the top management in its planned India team. The CEO has been hired. Another 4-5 positions have been filled. The company aims to launch its India operations by March,” one of the people said. It hired Reliance Jio Infocomm’s former chief marketing officer, Neeraj Bansal, as the local chief executive. Before Reliance Jio, Bansal was regional sales head at Google. Most recently, he was managing director of India and South Asia at AdParlor. “In India, DHL eCommerce will work with Blue Dart rather than competing with it. There is enough space and segments in the ecommerce industry for them to coexist,” said another person. Both people insisted anonymity.
Post-ecommerce-parcel is one of the four key divisions of DPDHL, the world’s biggest logistics company. The other three are express, global forwarding and supply chain. DHL is the only major global company to have a dedicated, separate entity for ecommerce logistics.
The ecommerce industry in India is estimated to grow at a compounded annual growth rate of 30% to $200 billion by 2026 in terms of gross merchandise value (GMV), according to a recent report by Morgan Stanley. GMV is the total value of goods sold.
Efficient logistics, supply-chain management and transportation are key to the success of the ecommerce industry.
Logistics companies in India are expanding their ecommerce arms fast to cater to the growing demand and in some years aim to exponentially grow their revenue from this segment.
“India is an important and strategic market for DHL and we will continue to invest and transform our logistics presence to keep up with the growth momentum we see. We are constantly looking for ways to grow our service offerings for our customers, and will be happy to share details when new developments arise,” said a company spokesperson.
DPDHL's plans can be seen as part of its efforts to step up business in this segment — its fastest growing — outside of the company’s stronghold in Europe.
“Ecommerce activities were stepped up outside of Europe, in part through logistics centres in the United States, Mexico and India and through last-mile delivery in Thailand,” DPDHL said in its earnings release for 2016.
“Ecommerce activities were stepped up outside of Europe, in part through logistics centres in the United States, Mexico and India and through last-mile delivery in Thailand,” DPDHL said in its earnings release for 2016.
The ecommerce industry in India is estimated to grow at a compounded annual growth rate of 30% to $200 billion by 2026 in terms of gross merchandise value (GMV), according to a recent report by Morgan Stanley. GMV is the total value of goods sold.
Efficient logistics, supply-chain management and transportation are key to the success of the ecommerce industry.
Logistics companies in India are expanding their ecommerce arms fast to cater to the growing demand and in some years aim to exponentially grow their revenue from this segment.
The firms are also facing tough competition from ecommerce giants such as Amazon and Alibaba that are spending billions in setting up their own logistics and supply chain network.
Two government moves this year are expected to give a fillip to the logistics industry.
The Bonn-based group posted revenue of €57.3 billion, of which post-ecommerce-parcel contributed the biggest chunk at €16.8 billion. The division was also the highest contributor to earnings before taxes, even as ecommerce revenue grew at the fastest at 12.5%.
Two government moves this year are expected to give a fillip to the logistics industry.
The government made a historic tax overhaul from July 1 that replaces several indirect tax heads, including countervailing duty, special additional duty of customs, excise duty, service tax, central sales tax, value-added tax, octroi and state cesses with one tax on goods and services.
The government also conferred infrastructure status to the logistics sector on November 21, which means any more investment in infrastructure — like warehouses and cold-chain storage — would get cheaper financing from banks.
The government also conferred infrastructure status to the logistics sector on November 21, which means any more investment in infrastructure — like warehouses and cold-chain storage — would get cheaper financing from banks.
The Bonn-based group posted revenue of €57.3 billion, of which post-ecommerce-parcel contributed the biggest chunk at €16.8 billion. The division was also the highest contributor to earnings before taxes, even as ecommerce revenue grew at the fastest at 12.5%.
The group is planning a four-year investment of more than €250 million in India, its biggest bet yet on the world’s fastest growing major economy, CEO Frank Appel had told ET in an interview earlier this year.
Appel had said the investment would be made in various tranches and in all its four business segments.
Appel had said the investment would be made in various tranches and in all its four business segments.
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