DHL Announces Investments in U.S. Ecommerce Infrastructure and Services
Deutsche Post DHL Group has announced a $137 million investment plan for the U.S. domestic and crossborder ecommerce market.
The group’s objective is to exploit the global business-to-consumer ecommerce market for shipments crossing borders, which are expected to grow from $400 billion to $1 trillion in 2020.
Since U.S. online merchants take the leading role in selling internationally, DHL eCommerce will make substantial investments in the United States in the next years and expand its capabilities to serve businesses selling abroad.
The announcement was made in conjunction with the DHL eCommerce and DHL Supply Chain divisions further implementing regional fulfillment centers in Los Angeles, Columbus, Ohio, and New Jersey, significantly increasing the companies’ order fulfillment capabilities in North America.
“There is barely any other industry that provides such a promising outlook than the ecommerce business,” said Charles Brewer, CEO DHL eCommerce. “It is expected that one billion people will shop online and across borders by 2020 with the U.S. being the most popular origin for 25 percent of consumers worldwide. With our investments, we lay the foundation to expand our leading role in crossborder ecommerce logistics, serve our U.S. customers with the best possible infrastructure and solutions, and gain future market shares.”
DHL eCommerce is looking to profit from these developments and to increase its ecommerce footprint in the United States. In line with the Strategy 2020, the group has made and will continue to make significant investments. After the first order fulfillment center opened in Columbus, Ohio, last year and followed by a facility in Los Angeles, DHL eCommerce will establish further regional centers of this kind in New Jersey and other locations in 2017.
DHL Express celebrates the opening of a new, $1.3 million service center facility in Chicago to meet heavy demand from ecommerce customers. One year ago, also DHL Global Forwarding opened up a $35 million distribution center in Chicago. All of these infrastructural engagements will provide merchants with the opportunity to place inventory closer to consumers in order to speed-up delivery.
Today’s global B2C cross-border e-commerce market comprises approximately $400 billion and is expected to expand rapidly. Emerging markets are going to fuel the estimated annual growth rate of 28 percent, followed by Western Europe, and North America. Thanks to China’s growing middle class, which will reach 630 million people by 2022, most of the purchasing power will come from Asia-Pacific and equal about 48 percent of the total volume.
Research shows that consumers increasingly buy products online that are either unavailable or too expensive in their home country. The biggest share of these crossborder purchases will originate in the U.S. DHL is looking to benefit from these developments and increase its ecommerce footprint in the United States.
The planned expenditure of $137 million will be used for the further expansion of fulfillment capabilities by adding eight distribution centers and enhancing two existing facilities in Los Angeles and Columbus, Ohio. The new investment will also expand day definite deliveries and enhancements to support domestic and international services.