Headline

The World Trade Center in New York collapsed after a terrorist attack. The dot com bubble burst. The euro was introduced. The iPhone revolutionised phoning. Angela Merkel replaced Gerhard Schröder. Barack Obama became the first African American President of the United States. China and India developed into leading economic powers. The real estate crisis grew into a global financial crisis.

And Hermes became a global logistics operator…

New hubs

HUB is short for the German word “Hauptumschlagsbasis”, meaning main trans-shipment centre. These came to replace the system of depots previously used as a more effective means of trans-shipping goods. They entered into service at the beginning of the 2002 financial year.

The consignments of several mail order companies were now bundled at the nearest HUB; there they were pre-sorted and distributed to the relevant branches. To this end, four HUBs were built from scratch or set up in extensively converted former loading halls. Situated for easy access at motorway junctions or airports, these HUBs of up to 100,000m2 have on average more than one hundred gates for loading and unloading vehicles. Inside, a tried and tested handling and sorting system ensures that each day hundreds of thousands of parcels, packages and bags are scanned and processed at a flow speed of up to 2.5 metres per second. In 2006, the starting gun was fired for the construction of the new western HUB at Hückelhoven in North Rhine-Westphalia, right next to QVC, the leading teleshopping operator in Germany and Hermes’ largest customer outside the Otto Group. In total, Hermes would invest € 37 million in building and fitting it. The main advantage is the fact that, via a bridge, two conveyers connect QVC’s goods and distribution warehouses directly with Hermes, and more than 11,000 consignments – from tie clips to flat screens – can be transported every hour.

Structural change

In 2004, the company structure of the Hermes Group was revamped, a process which was completed in 2009. All of the individual specialised companies presented themselves in a single integrated business strategy under the Hermes umbrella brand.

In 2004, Hermes intensified its cooperation of ten years’ standing with the haulage company Sänger by creating a joint venture, the Hermes Einrichtungs Service. This joint venture, which was managed by Hermes, complemented existing B2C services by offering the transport of furniture and large items. In addition, a number of Hermes companies which were closely linked to each other in terms of processes were merged, creating the Hermes Logistics Group.
At the German Mail Order Conference in 2009, Hermes presented itself as a supplier with comprehensive logistics know-how. All of the logistics services required by national and international mail order companies are offered by a single supplier – whereby customers could rely on tailor-made services developed by Hermes on the basis of its traditional proximity to the trade and its decades-long experience. These firms include Otto International, Hermes Hansecontrol, Hermes Transport Logistics, Hermes Fulfilment, Hermes Logistik Gruppe Deutschland, which is responsible for parcel business, and Hermes Einrichtungs Service, offering a comprehensive range of services geared to the logistics value chain.

The number one

In December 2004, Hermes Logistik Gruppe Deutschland (HLGD) was a winner in a Stiftung Warentest market comparison. Assessed on various criteria, the company was judged “reliable in terms of collections and deliveries”.

The price model of its ParcelShops, introduced in November that year and benefitting private customers and small traders alike, was also praised. Three parcel categories instead of four and price reductions ensured that HLGD, with its “transparent pricing system”, came out as the “cheapest supplier” of all parcel services ordered by telephone. In 2006, HLGD reduced its prices again: anybody who completed a label online and printed it out saved 20 cents per parcel.

Stepping on the accelerator

In 2005, Hermes entered the world of motor sports: as a partner of the German Touring Car Masters (DTM) championship and with Mika Häkkinen, twice world Formula 1 champion and DTM driver, as brand ambassador.

At the start of the 2005 season of the German Touring Car Masters (DTM) championship, Hermes became the official logistics partner – which enabled the company to advertise its services at race weekends to a broad audience. In the same year, Mika Häkkinen, twice world Formula 1 champion and DTM driver for Mercedes Benz, started wearing the Hermes logo on his jumpsuit. The ever friendly but modest Finn still makes public appearances in adverts, radio and TV commercials as a Hermes brand ambassador. He once casually dismissed two hecklers who challenged him to a race. But in real life he gets down to things, for example at charity events organised by Hermes, in which he has auctioned trips to Monaco or offered driving lessons to the highest bidder.

The European Logistics Union

The summer of 2007 marked a major new beginning. From July, Hermes started offering its services in Austria. With 1,200 ParcelShops, 700 delivery agents and its tried and tested services, the aim was to achieve a market share of 20% in the B2C and C2C segments by the end of 2008. This ambitious target was well and truly surpassed.

In the same year, Hermes entered the Italian market by taking a 30% holding in the Italian parcel carrier Swiss Post Porta a Porta. Hermes thus also had access to the fourth largest B2C package market in the EU. Hermes was also successful in the UK via its sister company Parcelnet Ltd. the largest delivery service in Britain that is independent of the Post Office. From 2009, this company also traded under the Hermes brand. By that time, Hermes had a share of more than 20% of the European parcel market. Anybody wishing to drop off international consignments has, from 2009, been also able to do so for destinations in Switzerland or Liechtenstein using Hermes. Parcels can now be sent from 24 European countries.