Reference no: EM132912524
DHL Global Delivery Service
Summary
DHL started in 1969 in San Francisco with a $3,000 investment. Today, the company delivers packages to 120,000 destinations in 200 countries, bringing in over $50 billion in revenues. DHL is a market leader in international express delivery. In fact, the company considers itself to be the inventor of international express shipping. DHL built its global operations by slowly expanding its services over the years. The company followed a backward path around the world from its San Francisco offices into Asia, moving on to Europe and Africa, and finally into North America. Its American operations have been strengthened with its recent acquisition of Airborne.
DHL's focus on improving its service in the U.S. prompted the company to acquire Airborne rather than take the time to build its own operations. The acquisition gave DHL market. Now the acquisition is part of the company's overall operation providing U.S.-based gateways for packages traveling to other parts of the world. All packages traveling outside the U.S. must pass through the U.S. Customs office located within the gateway sites. This video relates well to the discussion of acquisition versus Greenfield investments, and also to the discussion of strategy.
Discussion Questions.
1. DHL provides door-to-door service for its customers using its own agents. Discuss the service. What are the advantages of having in-house handling of packages when shipping internationally rather than using agents who work for several different companies?
2. When DHL moved into the U.S. market, it made the decision to acquire Airborne rather than build its own operations. Discuss the advantages and disadvantages of this strategy.
3. DHL's U.S. gateway system provides on-site customs clearance services. Does this give DHL a competitive advantage? Why or why not?
4. DHL believes that when considering international express delivery services, speed and reliability are key issues for the customer. Using the pressure for costs reduction/pressure for local responsiveness grid, consider the international shipping business. Where do the major players stand relative to one another? Is any one player better positioned to succeed.