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'Implementation of GST will help India enormously'
How has the slowdown impacted DHL
and the global logistics industry?
I think the sector suffered from the slowdown. We support the view that we can’t
escape the global slowdown, but we have reduced our cost positions around the
world. This helped us to have a reasonable second quarter. We have not seen so
far (in July - August) a very strong recovery in the economy. At least it is not
reflected in our numbers. |
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Once
things start looking up, what will it translate into for
DHL? It is still going to be a slow recovery.
In December I said we will have a ‘V’ shaped recovery,
and I was the only one who said that. The downturn was
so rapid and deep that if we have the first signs of
recovery, everybody will run in the opposite direction.
If that happens, we will see a steep increase. I think
the predictability of the future is becoming less and
less possible. So, you have to prepare the organisation
for permanent change. You have to take the costs out as
much as you can. There are signs that there might be a
fast recovery.
What kind of “permanent changes” are you preparing
DHL for?
First of all, you should honestly tell the organisation
that predicting something is very difficult. That apart,
you train your people by challenging them on their
day-to-day job and move them around, so that they are
used to a different environment constantly. That
prepares people for change.
In large export-focused economies like China there is
an increasing focus on domestic markets. How would it
affect you?
First of all, if domestic demand is going up, it’s a
strong signal that wealth is spread more evenly... more
and more people can afford to buy goods. We want to be a
part of that and China and India are huge countries. If
you compare the size of India, it has more population
than Europe. These are huge continents and we would be
crazy not to try to participate in that domestic growth.
What growth opportunities you see in India? And how
important is India for DHL?
Our operations in Europe and the Americas are still
larger than that in Asia. We earned $6 billion in
revenues from Asia, but that will change in the next few
years. We see a huge growth potential in India, be it
warehousing and distribution, or even freight business
or express business. We are in a leading position in
India already. Implementation of GST will help India
enormously. There will be an enormous demand for
high-quality, reasonable-cost services in the logistics
sector, if tax legislation changes. That will give us
huge opportunities to leverage our global skills in
logistics.
Indian companies require improvements in supply-chain
management. How do you see it?
The relative spend on logistics is high in countries
like India because infrastructure is a key constraint.
India’s airports, roads and ports are very busy already.
But the government has understood that there is need to
invest in infrastructure. And that is why we say that we
can bring a lot of value.
Source
: Economic Times, India, dated 14/10/2009
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