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SUPPLY CHAIN Division
Consistent branding of all DHL units
In the first quarter of 2009, we renamed the SUPPLY CHAIN/CORPORATE INFORMATION SOLUTIONS division in order to provide a consistent branding for all DHL units. It is now called the SUPPLY CHAIN division and houses the Supply Chain and Williams Lea business units.
Customer-focused Global Supply Chain solutions
We provide many industry sectors with customer-focused solutions that span the entire supply chain. By offering warehousing, distribution, managed transport and value-added services, we ensure that products and information reach markets faster and more efficiently, and create competitive advantage for our customers.
Our Supply Chain business is organised into four geographic regions. With local insight and global scale, we serve customers in more than 60 countries providing support for complex business transformations.
Our Williams Lea Business Unit is an expert in outsourcing corporate information management. Solutions include Office Document Solutions, Marketing Solutions and Customer Correspondence Management. We offer these solutions for customers in the financial, retail, consumer goods, pharmaceutical, publishing and public sectors. For example, we provide printing services for a major customer in the USA, readying much of the company's circular advertising inserts for distribution in newspapers or as direct mailings. This four-year contract, signed in mid-2009, covers most of their circular print needs and related logistics services.
We have defined seven key strategic industry sectors for our Supply Chain business: Consumer, Retail, Technology, Life Science & Healthcare, Automotive, Energy and Airline Business Solutions. Each sector is managed by a dedicated sector head who is supported by a global team of experts that handle customer projects and develop sector-specific supply chain solutions.
Consumer and Retail are our highest revenue sectors and remain our priority growth areas. Here we manage customer supply chains from the source of supply to the retail shelves. Flexibility, reliability and cost efficiency are key value drivers for our services in these sectors, which range from international inbound to warehouse and transport management to packaging and other value-added services.
Customers in the Technology sector require fast, flexible and efficient supply chains, and the demand for integrated product and service parts logistics is increasing. We help our customers improve their cost structures, especially in these difficult economic times. Our product portfolio ranges from inbound-to-manufacturing services to warehousing and distribution to integrated packaging, returns management and technical service solutions.
We see good business opportunities in the Life Science & Healthcare sector because the supply chains and business processes in many parts of the world are immature and the pressure to increase efficiency in this industry sector whilst reducing costs is constantly on the rise. We developed, for example, a successful supply chain model for the British National Health Service (NHS) that aims to generate savings for the NHS of approximately EUR1 billion over 10 years. Our services include the procurement and distribution of medical supplies in the UK.
The global financial crisis hit the automotive industry harder than most. It is because of this that our Automotive sector team focuses primarily on adapting our services to the changed structural environment and on enhancing our unique services.
In the fast-growing Energy sector, we team up with other DHL units to provide integrated logistics solutions for both the build and run phases of major energy projects. For example, we operate one of the world's largest fourth-party logistics services in Oman, transporting cargo and water and co-ordinating the movement of about 40 land-based oil rigs a month. We anticipate a strong increase in demand for energy as well as more regulation in terms of sustainability, both of which will most likely drive demand for our services.
A new sector we are focusing on is Airline Business Solutions, which we defined based on our activities in the aviation industry with customers such as airlines, airport operators and aircraft manufacturers. In 2009, we won a new contract with British Airways to provide catering and logistics for short-haul flights from Heathrow Airport, a contract that positions us at the innovative forefront of this sector.
DHL Supply Chain is the global market leader in contract logistics with a market share of 8.5% (2008). In this highly fragmented market the top 10 players only make up about 23% of the overall market, the size of which is estimated to be EUR147 billion. Whilst we are the leading contract logistics provider in our largest markets, North America and Europe, we face strong competition from local suppliers in all regions, especially in the fast-growing Asia Pacific market. We are confident that we can leverage our global expertise and good relationships with multinational corporations in order to expand our business in these markets.
Our Williams Lea Business Unit leads the market in outsourcing information management. This market is also highly fragmented and consists largely of specialists offering either a very limited set of services or occupying exclusive niches. Thanks to our broad range of international services and long-lasting customer relationships, we were able to build on our market leading position. In addition, we are leveraging DHL's excellent customer relationships to win new business for Williams Lea.
