GROUP MEMBERS:

ALI GOHAR- AROON- HIRA- SAHIL- SOM DEV

Vision
We want to be the logistics company people turn to the first choice not only for all
shipping needs, but also the first choice for career and investment opportunities, and being
the global benchmark for responsible business practice.

Mission
We connect people and improve their lives. And we do it by being uncompromisingly
customer-centric and delivering excellence day in and day out. By bringing people together
and making life simpler for our customers, our employees, our investors, and our society
we help make the world a better place.
Characteristics of mission statement:
1. Providing utility by improving the lives of people.
2. Inspiring in a sense that it delivers the message of being cause oriented that the
business is good to be in. It adds value to the lives of people.
3. Reconciling interests of stakeholders because in its mission statement company
expresses concern for its customers, employees, investors and society as a whole.
4. Broad in scope because company has kept room for its expansion and diversification
by not narrowing down its product line in mission statement.
5. Effort oriented because it can be observed from above mission statement that
company is focusing on continuous improvement and excellence in its field.
6. Not excessively specific in a sense that company has not mentioned its offerings in
the mission statement or the industry in which it operates. The scope of mission
statement is not narrow.
Components of mission statement:
1. Customers
2. Employees
3. Investors
4. Philosophy: improve peoples lives
5. Technology: making life simpler
6. Place: globally operating as indicated by bringing people together , connect
people and make the world better place
 7. Competitive advantage is excellence of the company in logistics i.e. though not
specified in mission statement.

Strategy 2020: Focus. Connect. Grow.

Our vision, mission and goals for the future are laid out in our "Strategy 2020: Focus.
Connect. Grow." Its a simple strategy without being simplistic. Built on the three pillars of
Focus, Connect and Grow, we have laid out a clear plan for the coming years with ambitious
yet achievable goals.

Strategic priority: Focus on what has made us successful

we are a global logistics company that is well-positioned in the worlds growth markets. We
remain focused on logistics as our core business. We also reconfirm our commitments made
in Strategy 2015 to be Provider, Employer and Investment of Choice as well as to contribute
to a better world, which we call Living Responsibility.
Operational priority: company has focused on continuous improvement on the prior set
commitments by providing better services like temperature controlled logistics services for
pharmaceutical products, have employed more than 500 employees for last two years
worldwide, and has been one of the priorities for the customers. Company is focusing on
more secure, transparent and cost efficient ways of delivering logistic services to business
customers and consumers as well.
Strategic priority: Connect across the organization
our people around the world possess an enormous wealth of know-how, expertise and
talent. We are working diligently to find new ways to tap into this treasure trove and share
it across our global family of businesses. One very significant step we have taken was to
introduce our worldwide certified program, which is a specialist training program for our
entire workforce.
Operational priority: company is focusing on producing expert employees by providing
opportunities to students and graduates by providing internship programs, internship
exchange programs and trainee programs including AIESEC (http://aiesec.org/ ), DHL
graduate program (http://www.dhl-graduates.com/ ) and other local programs as well.

Strategic priority: Grow in new market segments

We are expanding our business in growth markets and segments, especially in emerging
markets and the vibrant e-commerce markets of the world. There is so much potential to
build on our success and gain market share, and we aim to broaden our logistics services
and tap into these opportunities as we move toward 2020.
Operational priority: DHL is continuously striving to move into markets that are untapped
yet. Recently it has acquired a project in Germany related to pharmaceuticals logistics
services so it has also installed a facility which can accommodate more than 3000
containers.
PESTLE ANALYSIS:
Political:
Governments initiatives to minimize the taxes and import duties is encouraging the trade and
according to the newspaper Internationa the News on 13th January 2017 repoted as follows:
In a statement issued on Thursday, LCCI President Abdul Basit and Vice President
Muhammad Nasir Hameed Khan said that the prime ministers incentive package would go a
long way and hopefully will boost exports by around $3 billion by the end of the ongoing
financial year.
Such actions and decisions of Pakistan government are creating the room for logistics
industry and pose an opportunity for DHL as well to step ahead in the logistics market, as it
already is having almost 70% share of the logistics business that comes from other countries.

https://www.thenews.com.pk/print/178667-LCCI-urges-PM-to-extend-scope-of-
export-stimulus

Economic:
Oil Prices:

The current trend of oil prices is declining, as fuel expense is one of the major expenses of Courier
companies, so it is the positive point for this industry that their operating cost has decreased due to
decrement in fuel prices.

Exports to European Market:

Pakistan has got the status of GSP Plus status from European Union in 2013 which means that
Pakistan will not have to face the competition in European Market with other countries like: China,
India, Brazil, Bangladesh, After the status of GSP Plus the Pakistani exports were duty free in
European Market, After this status Pakistans Exports are increasing to European Market, so courier
industry also has opportunity to transfer those goods to European market, the exports to Europe
were 4.5 billion, 5.5 billion, 6.1 billion pounds in 2013, 2014 and 2015 respectively. The share of DHL
in international courier market of Pakistan is 70% so the increasing exports is clearly an opportunity
for DHL.

Exchange Rate:

Exchange rate matters a lot for business which are operating on global level and the currency of pkr
is not stable which also affects the profitability of DHL, Oil prices are also dependent on exchange
rate so if currency rate changes then the fuel expense will change ultimately it affects profitability of
DHL. As the graph shows that exchange rate is changing from 2008 to 2014 and after this time
period the change in exchange rate is very low but overall the currency rate is highly volatile.

CPEC:
CPEC is bringing about more than $65billion investment in Pakistan and due to this huge investment
many new foreign companies are coming in the market of Pakistan, like A French car manufacturing
Renault company, that is already a customer of DHL is planning to start assembling the cars in
Pakistan by 2018, another JAC Motors a Chinese state owned company is also planned to establish a
plant in Pakistan in order to provide cheap cars to people of Pakistan, certainly if they are coming in
the market of Pakistan they will import the parts from different countries so DHL can make the
contact with them in order to provide the valuable services.

Social:
Demographics:

Peoples increasing inclination towards online shopping in third world countries is creating a room
for logistic industry to foster. According to research conducted by Kaymu the people of age falling
between 18-34 years are most actively involved in online shopping than rest of the age groups.
Pakistan has 60% of its population as youth so there exists potential in market to cater this young
populations courier services need.

Emerging trend of e-commerce and easy internet access to individuals is an opportunity for online
shops and ultimately for courier industry. The world courier services market is expected to
generate huge volumes and could garner revenues of about $2.4 trillion by 2018, and DHL
being one of the market leaders has an opportunity to grab its reasonable share. DHL
already has daraz.pk as its customer.
http://marketrealist.com/2015/07/key-trends-shape-courier-industry-2015/
http://www.lhrtimes.com/2016/06/22/daraz-pk-partners-dhl-express-delivery-services-across-world/

Technological:
Technological advances in todays world seem no wonder but the fact is that sometimes these
advances can be threatening. In case of logistics industry major customers of logistics companies are
e-commerce based online markets including Amazon, e-bay, Alibaba and others. According to
research Amazon is the market leader at this time and it is highly focused on its technological
innovations to reduce its shipping and delivery costs. Drone services of amazon are under process
not in near future but not too far in future either. If Amazons drone project goes successful it will
give a great threat to logistics companies because drones will be operated by Amazon like its current
fleet of trailers and planes. It will cut shipping costs for Amazon like companies almost by half. The
heavy fleet and fixed costs will go in vain for logistics companies.

https://www.nytimes.com/2016/08/11/technology/think-amazons-drone-delivery-idea-is-a-
gimmick-think-again.html?_r=1
Legal:
Government authorities are considering new laws for logistic industry to be regulated with. In this
case logistics industry will be highly regulated and is expected to charge more prices to the end
consumers. As per the article published in DAWN newspaper:

The proposed regulatory authority would not only regulate the functions of courier
and cargo services but also generate funds for the government and set tariffs for
courier services in a transparent and fair manner.
This is a discouraging factor for logistics companies because it will take away the attractiveness of
cheap prices for courier services industry. This decision of regulatory authorities, if implemented will
become a negative indication for courier services companies in terms of losing customers.

Apart from that logistics and courier companies will be required to get license and pay license fees
to carry on operations in the premises of Pakistan. The license will be renewed every two years and
the authorities will lie with the Pakistan Private Courier Services Regulatory Authority
(PPCSRA) to renew the license and consider applications or not.
DHL will be bound to more rules and regulations that will definitely affect the sovereignty of
the company to comply with terms and conditions.
http://www.dawn.com/news/793782

https://propakistani.pk/2016/04/04/courier-services-to-get-expensive-as-govt-plans-to-regulate-
logistic-industry/

http://www.d2dlogistics.net/list-logistics-companies/

Porters Five Forces Analysis:

Threat of New Entrants
Threat of new entrant is Low, Because of factors such as capital requirement, If any new
company wants to enter in this market, They requires huge capital to compete with large
companies Like TCS, DHL and FedEx. DHL for example, has the total assets of US$38.567
billion while FedEx has the total assets of US$ 33.567 in 2011, So New entrants will have to
work hard to compete with these two companies, and snatch the market share.
If we talk about existing companies in this industry DHL, FedEx, they are operating globally,
they have vast network of ships, aircrafts carriers and ground transportation as well, so this
is the barrier for the company to enter in this market and compete with the giants of this
market.

Bargaining Power of Customers

Bargaining power of customers is high in the logistic industry. Logistic Industry in Pakistan is
very competitive, as there are some large companies capturing the whole market just like
we have FedEx, TCS, DHL, OCS, and UPS.
In this industry customers are very large in size, like Renault worth at 90.6 Billion is one of
the customers of DHL, Recently Renault selects DHL for battery pack replacement logistics
services. Another customer of DHL is Huawei worth at $57.319 Billion, On 24 OCT 2012, and
Huawei signed a deal with DHL to provide logistic services. From this we can analyze that
how large these companies are, and how these companies are influencing the profits of
Logistic companies. Now if we talk about switching cost, the additional cost they have to pay
for switching from one company to another, and that switching cost is low, These large
companies like Renault or Huawei, they can easily shift from DHL to Fed EX, If Fed Ex provide
them better and lower cost services.
Rivalry
Rivalry among current competitors is high, especially on international level. Companies are
doing partnership with one another to expand their operations. Just like Recently TCS
partners with UPS to expand its international operations. Companies are trying to bring
innovation in their services to gain the competitive advantage, Just like TCS Hazur, Door to
door service, This is the service provided by the TCS, By looking the changing trends in this
industry.
Threat Of substitute
Threat of Substitute is low. Though substitutes are available, Like Daewoo cargo service and
other local companies that offer courier services, but they dont have any efficient system to
compete with DHL or TCS. Besides that trend of online shopping is growing, and that
requires the delivery, so these courier companies become the necessity for those
companies. Just like Daraz, an online Shopping center, to deliver its products to customer
Daraz needs Courier Company, so that they can easily and cheaply deliver its products to its
customers. Now Daraz.pk partners with DHL for delivery services across the world. Now
Daraz cannot make contract with local company to deliver its products, because that would
be very risky, because there is risk either they will deliver its product on time or not. So in
this industry Threat of substitute is low.
Bargaining Power of Supplier
While choosing the supplier to buy things, DHL is left with tough choices. No doubt Most of
the Products that DHL purchases for the operations have the fixed prices like computers,
software, on these products they cannot negotiate with supplier, but Oil is also one of the
important products, DHL must purchase fuel for the airplanes, trucks and other vehicles,
and DHL pays lot of cost for that. In 2015, DHL purchase 1312.8 million liters for air
transport, 449.1 liters for road transport, we can see that how much fuel they consume to
run their operations, so every fuel business wants to work with them. Fuel suppliers are
likely to offer favorable payment terms and quantity discount in order to get that business.
CPM Matrix
DHL FEDEX TCS

Factors Weight Rating Weighted Rating Weighted Rating Weighted

Score Score Score
Price 0.2 2 0.4 1 0.2 3 0.6
Distribution 0.15 3 0.45 2 0.3 4 0.6
Outlet
Market Share 0.2 2 0.4 2 0.4 3 0.6
Financial 0.15 4 0.6 4 0.6 2 0.3
Position
Services 0.2 3 0.6 3 0.6 4 0.8
Global 0.1 4 0.4 3 0.3 2 0.3
Operations

1.00 2.85 2.4 3.2

EFE Matrix:
Opportunities: Weight Rank Weighted
average
Prime Ministers incentive package plan will increase exports by $3 0.05 3 0.15
billion.
Continuously increasing exports due to GPS Plus status of Pakistan 0.1 2 0.2
in European Union.
Declining Fuel Prices in international market will encourage DHL to 0.1 3 0.3
have bigger fleet.
Increasing demand for logistics due to foreign companies 0.3 3 0.9
investment through CPEC.
Emerging trend of e-commerce due to change in consumers living 0.2 3 0.6
patterns.
Threats:
Innovative technology like drone developed by Amazon will 0.15 1 0.15
swap the business of intermediaries (courier) industry.
Pakistan Private Courier Services Regulatory Authority 0.05 1 0.05
(PPCSRA) regulations will tend to increase the services prices.
Merger of T&T with FedEx will be a great threat to DHL. 0.05 2 0.1
TOTAL 1 2.45

Strengths
 Amongst the leading shareholder of the worldwide air cargo market
(Fleet Size: 75, Destinations: 150)
Network in more than 220 countries and territories and about 275,000 employees
worldwide
Received position in the magazines Worlds Top 50 Cargo Airlines list
More focus on central procurement & E-procurement
Weaknesses
The DHL is dependent upon other Business Organizations like E-bay and Ali Baba.
Awareness about DHL is not adequate.
Heavily dependent upon Technology