We recently caught up with George Berczely, General Director of DHL Express Vietnam who gives us a sneak peek into what he’ll be sharing during his upcoming presentation at Seamless Vietnam this September in Vietnam.
Hi George, good to hear from you! Please tell us a bit about what you’re currently working on and what you get involved on a daily basis?
So many things! For our people – who we call “Certified International Specialists” – we are rolling out a large Health & Well-being program that is driving excitement and motivation. We continue investing in our facilities, opening new service centers in Hai Phong and Binh Duong, which will expand our area of coverage and allow us to pick up shipments later in the afternoon. We are also starting to roll out parcel lockers so that our customers can conveniently pick up their shipments up to late in the evening. And lastly, we are working with several partners to address the cross-border shipping needs of eCommerce retailers, both import and export, that we see is about to take off in Vietnam.
How has the industry changed since you first got involved?
I started working in the Express industry 19 years ago. Since then, the change has been dramatic. Customers have become significantly more demanding, expecting incredibly short transit times – next day service throughout Asia, 1-2 day service between Asia and the US or Europe – and zero failures. The center of gravity of world trade has moved to Asia. The World Trade Organization has simplified many of the rules regarding import and export, and the large majority of our shipments in Asia now clear customs even before they arrive in the country. And over the last few years, eCommerce has grown from less than 10% of our shipments to an approximate 30% now. We have invested heavily to be able to fulfill those stringent quality expectations, and it has paid off as we now see customers increasingly switching to premium services.
Give us a sneak peek into what you’ll be presenting at Seamless Vietnam 2017
We will offer a live demo of our new parcel locker, which will allow customers to conveniently pick up their shipments at various points throughout the country, outside office hours. We will talk about the importance of selling internationally and of adding premium delivery services to the checkout options of eCommerce retailers. Selling internationally allows e-tailers to boost their sales by an average of 10-15%, which explains why 71% of e-tailers expect their cross-border share to increase. There are many services available to overcome the hurdles of international logistics – our specialty – and also creating trust, offering transparent pricing and international payment options.
Our experience also shows that e-tailers offering premium shipping grow 1.6 times as fast as those who don’t. First, young consumers really want to have choices when choosing the shipping solution. Second, premium shipping increases the basket value, reduces return rates and generates an exciting, positive experience which makes the customer return for more purchases more often. For the right kind of service, once the e-tailers see these benefits, they often decide to subsidize the premium shipping as it helps their sales grow faster.
Why are you excited to be participating in the conference?
In Vietnam, the e-commerce industry, including cross-border transactions, is about to take off. We have seen the same trend in other countries a few years ago, like India or Malaysia. There is constant bubbling in the market and a few pioneers, but when a tipping point is reached, transactions and shipment volumes just skyrocket. We have invested into our capabilities specifically for the e-Commerce market for many years, and have the capacity to support this trade both on imports and exports. It is exciting to meet the players of today and tomorrow in this market and be able to talk about how we can support them in reaching the world with their offering. Many have not yet thought about it, and every time we see a customer of ours get started and then achieve growth rates of 200-300% by serving the world it is an amazing feeling.
What do you think are the key challenges of developing e-commerce in Vietnam?
One of the challenges is that credit card penetration and trust in financial institutions – and in new retailers – is low. Vietnam is still largely a cash economy, and customers prefer to see the goods on their doorstep and pay cash-on-delivery for them. Only few, premium providers offer this for the local market, and this option is not available for international purchases. Second, the import regulations are quite complex for many goods requiring specialized inspection or licenses, eg. in cosmetics, health care, food supplements, electronic equipment, etc. Customers are often not aware of these requirements and are surprised when they are required to pay duties and taxes. Engaging early with a professional logistics provider can ensure full transparency of the rules and regulations for a seamless and convenient shipping experience. Exporting is simpler, also for small or mid-sized enterprises, but they often think it is too difficult. In fact, there are many service providers today that can help an e-tailer or manufacturer develop an online cross-border offering. It will take time, and events like this Seamless conference, are a great platform for retailer and e-tailers to expand their knowledge in this area. Once a critical mass of knowledge and experience is achieved, sales will skyrocket.
What motivates you every day, George?
I love my job. Express is a service industry based on people, so engaging and motivating our great staff is a priority and great fun. Only motivated people can provide great service quality, and I like working with my colleagues. Second, our service does good. We allow enterprises to access the whole world conveniently, providing growth opportunities and helping to create employment and wealth. It is fulfilling to have a purpose, knowing that what we do connects people and improves lives. Third, Vietnam is one of the best places in the world to be right now. There are so many business opportunities that we really have to prioritize carefully what to do next, so that we can deliver fast and reliably before moving on to the next thing. We can all feel this, and as “success breeds success” we build on each achievement to aim even higher. It is a luxury to have such a job.
George Berczely is one of over 50 speakers who will be taking the stage over two days at Seamless Vietnam, to be held at the Intercontinental Saigon from 6-7 September 2017. To find out more, and to book your tickets, check out our website here.