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Business spotlight

There are many international companies in and around the Cologne, Bonn, Düsseldorf region.  They are attracted to the state of North Rhine-Westphalia for many reasons, but probably the main one is because NRW is Germany's economic hub, nearly one in five Euros are earned in this region - more than in any other German state. If NRW were an independent country, it would rank 16th at the international level in terms of economic strength - ahead of countries such as the Netherlands and Switzerland.

Over half of Germany’s top 50 companies are based in NRW, including Bayer, E.ON, RWE, Bertelsmann, Deutsche Telekom, Ford, Aldi and Deutsche Lufthansa.   Bonn is a particularly attractive business address as the city itself is small and easily accessible, and provides good quality of life for its employees.  Which is why Deutsche Post/DHL built their skyline defining Post Tower just off the Museumsmile, and in doing so, firmly established their home base in Bonn.

But what does the future hold for Deutsche Post/DHL in the booming electronic age?  Domestic letter volumes have decreased severely since the advent of email, but business post and direct marketing are as popular as ever.  Deutsch Post has also had to deal with the EU postal liberalisation directive, which aims to open up postal markets across Europe by 2011.  We talked to Dirk Klasen, Deutsche Post DHL - Corporate Communications officer to find out what is in store for one of NRW’s most important residents.

How does Deutsche Post/DHL feel about the proposed opening of the entire postal system in 2011?
DPDHL has always argued in favour of a parallel opening of postal markets in Europe to enhance competition. Unfortunately, a step-by-step opening has been chosen, which has postponed the complete liberalisation to 2011 and for some countries to 2013. Germany is one of a small number of EU member states that completely opened its national postal market in January 2008.

How has this changed the DP/DHL business model?
Our business models are clearly focused on a competitive environment. DPDHL as the biggest postal operator in Europe regards the market liberalisation as a business opportunity and is prepared for competition in its home market. (FYI: In Germany, there are already over one hundred competitors in the MAIL sector, mainly on the regional and local level.)    

Would DP customers prefer to conduct their postal transactions online rather than go to an actual post office?
Postal companies worldwide have had to face a constant decrease in the number of physical letters sent over the past few years, as a result of  what we call “eSubstitution”. The reason for this trend is the rapid spread of electronic communication tools like SMS, email and Internet communication. However, we don't believe that the classic letter will die, especially with regard to our business customers who continue to use it, for instance in the area of direct marketing. We have developed innovations like the "Plusbrief Individuell", the "Handyporto" and the "Internetmarke" and we are working on new products and electronic services for safe and easy communications like the "letter on the internet" (which is not a new type of email) to explore new business opportunities.

Will it be possible to send letters in the future without first having to buy stamps?
For the traditional, single private customer using letter mail box: probably not. The stamp tells the postal provider that the transport price for letter has been paid. We are just working on a project to transfer the physical letter to the internet regarding liability, security and identification of sender and recipient. But even so, the price for such a service will probably have to be paid when the customer uses the service. 

What kind of competition do private sector companies like TNT and Hermes present to Deutsche Post - are they losing business to them?
We don't comment on competitors in principal. However, as far as we can see Hermes is, above all, a competitor in the parcel business while TNT is also offering letter mail service to business but not to private customers. Additionally, the national German regulation authority Federal Network Agency report that around 700 competitors are active in the mail business, mostly on the regional and local level.

Will we still see the traditional postman in the mornings or will we all move to electronic post delivery systems?
We believe that the postman won't disappear in the next few decades but the trend to online communication will continue.

Why should the public choose DPDHL over the competitors?
Deutsche Post is the quality leader in its industry, not only in Germany. We are the most experienced, most reliable and most visible service provider, delivering to every household in Germany.  

How does DPDHL hope to adapt to the future needs of customers and businesses, can it change from a large state led organisation to a lean and agile competitive company?
That change has been taking place for the last 20 years, ever since the so-called postal reforms started. Meanwhile we are the largest logistics provider worldwide with over 500.000 employees, listed on the Frankfurt stock exchange among the 30 most valuable German companies in the DAX, and the majority (70 percent) of our shareholders are private investors.  

So it looks as if DPDHL is successfully riding the wave of electronic communications and putting measures in place to survive in a changing market. 
The team at Rhine-online would like to thank Dirk Klasen for his comments and feedback, and we look forward to continuing to help DPDHL’s international staff settle into the region.

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