Dhl Strategy to Enter China Market Essay

Words: 4077
Pages: 17

DHL Worldwide Express headquartered in Bonn, Germany, a privately held worldwide delivery service comprised of DHL Airways and DHL International, is the world’s oldest and largest international air-express company. They begins by operating door-to-door express delivery express, transporting documents only between San Fransisco, California, and Honolulu, Hawaii. DHL was founded by three young shipping executives; Adrian Dalsey, Larry Hillblom, and Robert Lynn who were casting about for a way to increase turnaround speed for ships at ports. On 25 September 1969 they incorporate DHL. In 1998, Deutsche Post began to acquire shares in DHL. It finally reached majority in 2001 and completed the purchase in 2002. Finally, by 2003
…show more content…
The four major players in the market were DHL, FedEx, UPS and TNT.
The US-based FedEx entered China in 1984. It became the first foreign express transporter to launch direct air-cargo flights in and out of China. In 1999, it formed a joint venture with the Tianjin-based Da Tian Air Services Limited.The same year, FedEx launched its express handling facility in Shenzhen, which became a major revenue generator. By the end of May 2003, FedEx had a network covering 220 Chinese cities. The company also planned a separate China business unit in Shanghai to capitalize on opportunities arising in the booming airfreight market.
Another US-based company, UPS, entered China in 1988 through an agent partnership relationship with Sinotrans. According to the agreement, UPS delivered packages or documents to China while Sinotrans distributed them to locations within China. UPS started with express delivery of small packages and documents. After establishing itself in the market, UPS began efforts to gain approval to fly direct from the US to China. It made all efforts to maximize its share in the market. In the fourth quarter of 2002, UPS revenues in China grew by a massive 60 percent. The company aimed at enhancing its presence from 21 to 40 cities by 2003 end.
TNT began expanding its network in China in early 2000 by increasing its branches from 12 to 25. The number of gateways went up from three to seven by the end of