Leading integrators DHL, TNT, FedEx and UPS need to reorganise their networks as a result of structural changes in the industry according to consulting firm Datamonitor. Despite severe cost cutting programmes, the four major integrators have all recorded a major drop in profits in the last quarter, largely due to significantly lower volumes as well as customers opting for cheaper alternatives, Datamonitor said in a statement. “However, both DHL and UPS companies have gained some significant ground on their competitors also affected by the current recessionary climate, and are remaining cautiously optimistic despite there being no clear date for an economic recovery just yet.” Datamonitor believes the structural changes that have taken place in the express industry in terms of geographic focus, distribution models and customer preferences will require the leading firms to reorganise their networks. This implies shifting the geographic focus to emerging markets (such as South America and the BRIC countries), and improving their road networks in order to cater for customers requiring alternative transport modes.
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