Well prepared
In a survey conducted by the German Association of Mail Order Companies in the middle of the 1960s, it was officially confirmed what the people at OTTO had long known. The Deutsche Post was too expensive, too slow and too unreliable.
Werner Otto, founder and then Chairman of the OTTO Board, therefore launched a plan to make the delivery of packages and parcels independent of the post office. Concrete planning began in 1967. The new computer equipment at Otto enabled all orders to be processed on a local basis. In February 1969, “decentralised parcels dispatch” was launched: The first packages were trucked to Düsseldorf, Offenbach and Heidelberg and only there were they entrusted to the post office. Delivery times were shortened by at least a day, and some cost savings were also achieved. The partner used for the “long stretch” of the journey was the company Union-Transport-Betriebe Paul Posselt (UTB). During the Christmas rush of 1969, UTB delivered up to 10,000 packages a day just to Düsseldorf. Encouraged by this success, planning for a complete package distribution system which would also incorporate local distribution subsequently followed. Cooperation with the Werner Velbinger Organisation (WVO), West Germany’s largest deliverer of catalogues and samples to private households, began in 1970. One significant argument in favour of this choice was the fact the WVO checked locally that delivery had properly taken place. The first regional test in Hamburg in 1971 was so successful that a second depot was opened in Frankfurt, followed in 1972 by seven further depots in Western Germany. They had a total storage area of 200–300 m2, each one employing a manager and three or four drivers. Overall, these depots handled around 25% of OTTO’s entire shipping requirements. It was because of these experiences that the company Hermes-Paket-Schnell-Dienst GmbH & Co. KG was eventually set up.