Spring 2009

The rebranded Parcelnet aims to strike a fine balance between its established UK market and the opportunities opening on the international scene

A new name will start to appear on home delivery vehicles over the coming months: Hermes. It reflects a decision by Germany's Otto retail group to re-brand Parcelnet, its UK delivery business, to echo its identity in other countries.

The change is not merely cosmetic. The group has aspirations to take the international lead in cross-border home delivery of distance shopping, and wanted to adopt a single identity that would be recognisable in all markets where it is active.

Parcelnet's UK managing director Carole Woodhead says the change 'opens fantastic opportunities for the company and its customers,' and describes it as 'the first European home delivery service'.

 

In its native Germany, Hermes claims a remarkable 22 per cent share of all home deliveries. In recent years it has been expanding steadily into neighbouring countries, either directly or through acquisition. It now has strong presence in France, Austria, Spain and the UK.

First customers

Expansion has taken several different forms. In Austria, for instance, it has been largely organic, whereas in France the group has a long-term involvement in an existing company, Mondial Relay. The Hermes brand should now be appearing in all markets.

The first cross-border customers in the UK are already on board. They are Lands End, a long-standing client, and JD Williams, whose German-language Simply Be web site was launched only this year. Further UK-based cross-border customers are expected to be announced in May.

Carole Woodhead says the group will also be promoting its services to continental retailers setting up web sites that target the UK – a service which it reckons it will be able to market more aggressively following the roll-out of new automated POD system here later this year.

She emphasises that the UK company's domestic operations will not be compromised or in any way sidelined by these changes. 'The aim is to get the best out of each individual market,' she says, pointing out that a wide-ranging investment plan is being rolled out in the UK, and will include extensive spending on IT and infrastructure. A real-time track and trace system is due to go live here in the summer, and all couriers are due to be issued handheld terminals by October.

Lifestyle couriers

The extensive use of 'lifestyle' couriers by the UK company will continue, Woodhead says. Couriers are also used in Germany, though not to the same extent as in the UK, while elsewhere the company uses more conventional delivery vans. Employment law in nations such as France militate against this approach. 'We suit our operational style to each different market,' Woodhead says.

A new national hub being developed at Nuneaton will ensure that the company can offer a nationwide next-day delivery service, she says. 'Next-day is becoming increasingly important in a market where traditional agency-based home shopping is in decline, but where internet shopping is still growing fast.'

Currently the UK company offers full next-day delivery only to Next Direct plus in-house users Grattan and Freeman, but now Hermes plans to offer it across the board. 'Consumers want choice, and our clients want to offer it.'

There is no plan to re-livery the distinctive purple Parcelnet van fleet to reflect the new branding – an option that is seen as a needless expense. Some vehicles have been finished in the new livery for promotional purposes, but others will appear only as the fleet is replaced.

The name Hermes may not be entirely unfamiliar in the UK's fulfilment world. Back in 2001 Otto set up an embryonic UK operation called Hermes General Service, which hoped to offer a comprehensive range of fulfilment services, including transport. It aimed to harness the combined resources of Grattan and Freeman – including Parcelnet, their joint delivery business.

That operation was later wound down, though Parcelnet continued to provide some fulfilment services. However, recently the company decided to focus entirely on the delivery end of the market, and this will remain the focus of the re-branded Hermes business.