DHL Logistics: SWOT Analysis and Strategic Recommendations

This paper provides an overview of DHL logistics firm and its operating environment. It identifies the strengths and weaknesses of the firm against its opportunities and threats and uses the findings to provide proper recommendations to boost the firm’s performance.

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Logistics and Supply
Name:
Institution:

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Contents
Executive Summary.........................................................................................................................3
Introduction......................................................................................................................................3
Objectives........................................................................................................................................3
Scope................................................................................................................................................3
DHL Activities.................................................................................................................................4
DHL SWOT Analysis......................................................................................................................4
Strengths......................................................................................................................................4
Weaknesses..................................................................................................................................5
Opportunities...............................................................................................................................5
Threats.........................................................................................................................................5
Strategic Recommendations............................................................................................................6
Sustainable Competitive Strategy................................................................................................6
Differentiation Strategy...............................................................................................................6
Marketing Strategy......................................................................................................................6
Research and Development Strategy...........................................................................................7
References........................................................................................................................................8

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Executive Summary
This paper seeks to provide an overview of DHL logistics firm and its operating environment.
The paper identifies the strengths and weaknesses of the firm against its opportunities and threats
and uses the findings to provide proper recommendations to boost the firm’s performance. The
recommendations will help the firm to remain competitive in the logistics industry for the next
five or so years.
Introduction
Currently, the world stands at the edge of a new millennium. It is to our expectations that
there is going to be an increase in success, inventions and renovations of the current modes of
technology to make dramatic economic changes. Dramatic economic changes channel down to
the financial performance of a company or a firm. This in-kind means that firms like DHL need
to adopt the best technologies to remain competitive in their own industries; as such, the firms in
the logistics and supply industry as well need to adopt the best strategies in order to remain
competitive over the next couple of years.
Objectives
The main objectives of this study will be:
1. To conduct a situational/environmental analysis of DHL logistics firm( SWOT Analysis)
2. To provide strategic recommendations for the firm to boost its competitiveness
Scope
This paper applies to all levels of study or management, the research will be keen to provide
strategic decisions lo help DHL logistics to remain competitive for a couple of years. This study
can be used by tutors, students or the public interested in conducting further research on the
same.

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DHL Activities.
DHL is the world best logistics service provider, present in over two hundred and twenty
countries all over the world. The firm has an active role played in planning, sourcing, delivering,
producing, storing and return logistics services ("DHL | Transport Management and Distribution
Logistics | English," 2018). As a world leader in the logistics and supply industry, DHL has
expertise in specific customer sectors such as automotive, engineering and manufacturing, retail
and finance services as well as consumer segment. The key strategy applied by the firm is that of
differentiation through providing solutions to specific market segments and the workforce who
are moved to meet the demands of the consumers.
DHL SWOT Analysis
For a team of strategists to give a way forward for the firm, it is always necessary to
conduct an environmental study in which the firm operates (Simoneaux and Stroud, 2011). By
this, the strategists will be well versed with the threats and opportunities in the field and provide
appropriate strategies to counter the threats and accommodate the opportunities.
Strengths
This element of SWOT analysis deals with the internal business environment. Among the
top strengths of the firm, include the presence of a large network. The firm serves over 220
countries around the globe, making it the largest global shipping firm. Possession of effective
communication techniques and in house consultancy has helped the firm achieve this. In
addition, the firm has top-notch innovation techniques, much as we think the firm as a leader in
the logistics field, the firm has made a good investment in research and development. From the
DHL Innovation Centre customers can engage with the firm stakeholders effectively. In addition,
successful projects like smart sensor and resillience360 are products of the DHL Innovation
Centre (Bhasin, 2018). Another key strength of the firm is that the brand is growing in
developing economies; the firm in this insight has as well boosted its investments in such
economies in order to have a good impression in such economies. For instance in India, DHL has
invested $16 million for use in developing new modes of technologies such as drones for

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deliveries and handling logistics. The firm as well enjoys a good financial position; the firm is
versed with better resources compared to other firms in the industry something, which gives it an
upper arm against, rivals. Basing on the strengths of the firm, it is evident that the firm is
resilient through the creation of diversity and a strong system in logistics and supply chain.
Weaknesses
This element in SWOT analysis shows the internal factors such as shortcomings, which
affect the firm’s development. The main weaknesses of the firm include inappropriate marketing
strategies in comparison to FedEx and UPS who have proper marketing expenditures; this affects
the brand acceptance in most countries, heavy investments are needed for the firm to remain
vibrant in the industry and over-dependence on external agencies for market information
(Haseeb, 2015). Relying on external firms for market information reduces the efficient running
of the firm.
Opportunities
Opportunities set the external factors that a firm can adapt to grow its business. DHL's
main opportunities are the presence of emerging markets, the firm needs to focus on consumer-
based global supply chain as it plunges into taking over the new markets (Riggins, 2017). The
emergence of E-Commerce sets in as another key opportunity for the firm to take over. DHL
needs to tap into the electronic marketing platform before it is flocked with other logistics firms.
Threats
In respect to SWOT analysis, threats refer to those external factors that can lead to
reduced business performance. Among the key threats to the performance of the firm is the issue
of competition, for the firm the main competitors are FedEx and UPS, there are several small
logistics firms which as well pose competition to the firm("DHL | Press Release | English,"
2016). The issue of economic slowdown is as well a key threat since in occurrence of a recession
in the economy, the logistics and supply industry becomes drastically affected. Presence of local
logistics firms poses a threat to the services of the firm since, such firms can offer similar

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services at lower prices compared to those of DHL and at times, the services can be even better
in terms of quality compared to those of DHL.
Strategic Recommendations
Based on the situational analysis of DHL, the following are some of the key suggested strategic
options:
1. Sustainable Competitive Strategy
The competitive advantage of a firm should be one that is unique and difficult to imitate
based on the resources and the capabilities of the firm (Faulkenberry, 2016). This consists of the
assets, market and product knowledge and the information by the firm in regards to the industry.
Differentiation strategy that DHL adopts should be one to counter all competitors. In order to
achieve this, DHL needs to conduct a situational analysis of all its competitors such as FedEx
and UPS. Recently, FedEx planned a takeover of TNT Express a logistics firm and it created
questions on the efficiency of DHL in the industry. DHL needs to come up with strategies to
counter all possible advances made by its main rivals. This includes forming strategic alliances
and joint ventures with firms not only in the European market but also in the developing
economies in the world.
2. Differentiation Strategy
Globally, most logistics firms offer similar products and services (Banker, 2018). In order
to remain competitive, DHL needs to differentiate itself in terms of the products and services it
offers in order to remain in the forefront in the industry. The firm needs to do away with the non-
performing ventures and remain with only the ventures, which are productive. This will see to it
that most resources are channeled to the ventures, which have returns to the firm.
3. Marketing Strategy
The firm has great rivals; as such, it needs to adopt good marketing strategies, which will
make it remain at the top of the world markets. This includes investing in marketing in the
developing economies such as Pacific Asia and Africa region. This will broaden the knowledge

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of the consumers about the existence of the firm, which will play a key role in gaining control
over the markets.
4. Research and Development Strategy
For a firm like DHL, it is not in order to depend on external agencies to provide
information about the industry. As such, it needs to invest in research and development on its
own since it’s not clear that these agencies as well provide information about the market to the
competitors of DHL. A question of accuracy of the information as well arises since it’s not clear
who else these firms work for.

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References
Banker, S. (2018, February 20). In The News: Supply Chain Strengths, Weaknesses,
Opportunities And Threats. Retrieved from
https://www.forbes.com/sites/stevebanker/2018/02/20/in-the-news-supply-chain-
stengths-weaknesses-opportunities-and-threats/#158eee3261da
Bhasin H. (2018, February 9). SWOT Analysis of DHL - DHL SWOT analysis and internal
analysis. Retrieved from https://www.marketing91.com/swot-analysis-dhl/
DHL | Press Release | English. (2016). Retrieved from
http://www.dhl.com/en/press/releases/releases_2016/all/logistics/supply_chain_resilience
_best_defense_against_growing_global_risks.html
DHL | Transport Management and Distribution Logistics | English. (2018). Retrieved from
http://www.dhl.com/en/logistics/industry_sector_solutions/aerospace_logistics/
transport_management_distribution_logistics.html
Faulkenberry K. (2016, October 29). Sustainable Competitive Advantages: Definition, Types, &
Examples - Arbor Asset Allocation Model Portfolio (AAAMP) Value Blog. Retrieved
from http://www.arborinvestmentplanner.com/sustainable-competitive-advantages-
definition-types-examples/
Haseeb. (2015, November 16). SWOT Analysis of DHL. Retrieved from
http://marketingdawn.com/swot-analysis-of-dhl/
Riggins N. (2017, November 1). FedEx Acquires TNT Express, Means Better Delivery in
Europe - Small Business Trends. Retrieved
fromhttps://smallbiztrends.com/2016/05/fedex-acquires-TNT-express.html

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Simoneaux & Stroud, C. L. (2011). SWOT analysis: The annual check-up for a
business. Journal of Pension Benefits: Issues in Administration, 18(3), 75-78.
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