Name: Dagnew Jerusalem

Student no: 2115106029

DHL SWOT Analysis

ABSTRACT

The rise and development of DHL as an enterprise are notably admirable in the logistics industry
today. For such an enterprise, regardless of the form of ownership and scope of business activity,
it is necessary to effectively manage business activity by defining its management strategy.

The company’s mission and strategy have enabled it to offer excellent service to individuals and
business owners across the world. Segmentation is the major marketing strategy that DHL has
successfully used to meet the needs of a large group of clients worldwide.
The
company’s mission and strategy have enabled it to offer excellent services to individuals and
business owners across the world. Segmentation is the major marketing strategy that DHL has
successfully used to meet the needs of a large group of clients worldwide.
Following this
research, it is clear that DHL has an elaborate workflow that enhances the smooth running of its
activities. In addition, the company has introduced systematic management, to ensure that all
duties are covered by qualified and experienced professionals.

To fully understand the intricacies of the area and effectiveness of the "Management strategy," it
is essential to identify what constitutes their strength, weakness, opportunities, and threat, hence
the acronym SWOT. The mainstay of this research seeks to explore the use of SWOT analysis to
analyze the management system of DHL.

The study uses qualitative research methods in interpreting roles as defined by functions in the
company's structure to establish meanings that construct social reality.

Keywords: enterprise, analysis, strategic management

1. INTRODUCTION

As a renowned brand in the logistics industry, the primary function of DHL can be asserted as
"to provide and integrate operation, warehousing, and transportation services that can be scaled
and customized based on customer needs or market conditions by satisfying the customers'
demand by delivering goods and services at the right time and the required place." This paper
focuses on the management system of DHL mainly to examine what reasons and factors make it
one of the most successful logistics companies all over the world and what competitive
advantage DHL can gain through external analysis and internal analysis of its organizational
strategy. Most leading logistics companies evaluate and gauge their marketing strategy to survive
and keep up in the evolving competitive environment. Additionally, with globalization and the
development of technologies, more and more companies have realized today's complex,
competitive situation.

Additionally, these organizations and enterprises need to focus on the differences among
different countries in developing a marketing strategy to ascertain the critical factors to make
others thrive. As a logistics company, the primary function of DHL is to provide and integrate
operation, warehousing, and transportation services that can be scaled and customized based on
customer needs or market conditions. They aim to satisfy customers' demand by delivering
goods and services on time and at the required place. Undoubtedly, an excellent delivery service
can win the loyal customer and gain considerable profits that expand the company's business.

The question of how DHL has maintained its leading market position has prompted this research
and only sprung the need to investigate what sets them apart from other competitive brands with
the SWOT analysis.

There are several reasons for carrying out this research, most notably the rapid growth of
business enterprises worldwide. In this new era of digitization, setting up a business is easier and
more accessible to the commoner at the grassroots because of technological platforms and
devices. Unarguably, it is imperative to sustain and grow a business. This cannot be adequately
achieved without analyzing the strategies to develop the business and ascertaining its efficiency,
lapses, and what can be done to aid improvement. SWOT analysis comes in as it answers all the
essential questions for enterprises. Therefore, this paper aims to study what competitive
advantages and disadvantages DHL can gain from external and internal factors and what DHL
can learn by analyzing this research results using SWOT analysis.

DHL International GmbH (DHL), a subsidiary of Deutsche Post DHL, provides logistics and
transportation services. It offers international express deliveries, global freight forwarding, and
contract logistics solutions. It carries out the international parcel and document delivery services;
domestic and international parcel and e-Commerce services; freight forwarding services through
the ocean, air, road, and rail transportation; and supply chain solutions. The theoretical
framework of this research borders on D. Aaker's theory which emphasizes that customers and
competitors can be classified in a company's external analysis. Meanwhile, the company
reputation and product or service of the company should be organized into the internal analysis.
D. Aaker asserts that Internal analysis help companies identify if the existing strategy is suitable
or if there is any need to adjust it. Indeed, the internal analysis addresses the company's
performance, such as brand association and product quality. Internal analysis helps an
organization identify its organizational strengths and weaknesses. At the same time, the External
environment changes outside the organization's boundaries, such as customers, suppliers,
economic, political, cultural, and technological changes. The core framework of this paper is
based on the ideologies, justifications, and understanding of the effect of the Internal and
External analysis to get accurate data.

Analyzing the marketing strategy of a company is porous. This is because the authors cannot
successfully identify all factors in the research. Instead, this thesis only presents a minimal part
of marketing strategy, i. e. external and internal analysis to describe the critical success factors to
get information on the DHL management system. Additionally, the rapid change trends caused
by unpredictable circumstances can also impact company decisions and actions. For example, no
one predicted that the world would stand still for about three months without movement and
restricted business activities. However, with the pandemic, companies have had to adjust swiftly
to the situation to still function and deliver value to customers. Therefore, SWOT analysis cannot
explain how DHL management handles unforeseen cases.
Consequently, it cannot reflect the comprehensive views and perspectives of other departments
concerning their objective opinion of the structural framework of the company. Ethics issues
must be considered as it is essential in any research study that examines the study of people's
lives and behaviours. This is a form of human rights protection free of harams and respects one is
privacy and opinion. Ethics in research is primarily about how researchers should treat the
people they are studying. Oppenheim asserts that participants' confidentiality lies in the hands of
the researcher, who is expected to protect their identity and ensure their data are not made public
without their consent. The contributors' consent was obtained, and it was agreed that their
personal information would not be disclosed to the public.

1.2 Purpose
This thesis aims to study what competitive advantage DHL can gain from external and internal
factors and what DHL can learn by analyzing the competitive advantage.

1.3 Research questions The research questions of this thesis are:

RQ1: What competitive advantages does DHL gain from external and internal factors?
RQ2: What competitive disadvantage does DHL have?
Moreover, what can DHL learn from analyzing competitive disadvantages?

1.4 Limitation

Marketing strategy contains many issues, and therefore the authors cannot identify all success
factors in this research. Instead, this thesis only presents a minimal part of marketing strategy, i.
e. external and internal analysis, to describe which can be the critical success factors to gain a
competitive advantage for DHL. It cannot represent or explain why the entire 3PL industry can
grow fast and become an emerging industry today. Besides, this thesis focuses on the DHL
marketing department. The authors only gathered information from the DHL Express Head of
Marketing Communication and DHL's site manager; therefore, it cannot reflect other
departments' comprehensive views and perspectives. Furthermore, due to some questions being
sensitive to DHL, the authors could not officially get complete information from the company.

2. External and Internal analysis

According to Aaker (2001), a successful external analysis should be directed and purposeful.
External analysis can affect strategy by providing optional strategic alternatives and even
influencing the final decision-making.

DHL incorporates a vast network in operation in 220 countries. DHL is the world's largest
provision supplier within the world DHL has been supported by sensible contact and outstanding
in-house consulting to expand its reach.

DHL is hierarchical among the simplest world wholes with high brand equity.

DHL is growing its business in developed countries. DHL has invested extensively in developing
nations to line up and extend their facilities to own a broad presence in rising economies.

DHL incorporates a strong money record, and it has thought of owning enough finances to back
it up. As a consequence, additional and additional enterprises trust DHL and its services. This
money standing additionally lets DHL grow its year-on-year business.

DHL comes itself as a frontrunner in provision. It is structurally engaged in the creation of

pattern analysis and solutions. It has created a DHL Innovation Hub that gives a forum for
customers and partners to attach with DHL specialists. Resillience360 and sensible devices were
widespread initiatives for providing systems that originated from the middle of ability.

DHL has practical client support.

DHL incorporates a sensible grievance redressal system for its customers.

DHL incorporates a giant worker base. DHL is defraying tons on the coaching and development
of its staff. This can facilitate the team to figure additional, and the corporate's productivity
increases.

Weaknesses within the SWOT Analysis of DHL – DHL SWOT Analysis

Logistics trade needs vast investment to line up operations and grows. DHL additionally needs
serious investment to grow its business and come back on investment.

DHL is anticipated to act in compliance with regulative pointers and native authorities. Rules are
entirely different within the supply and destination locations, and then it is not possible to
conform to completely different directions.

The logistic Market is full of several native and international players. The market growth is
distributed among all the players. Because of the high rating strategy, DHL's market share is
restricted in developed and developing economies.
Due to a big market and an outsized network of delivery partners, the square measure is needed.
DHL additionally depends on trim and native entities for delivery. Moreover, this directly
influences DHL's effectiveness, and cooperation becomes necessary.

DHL has less cost than FedEx or UPS and does not pay abundant on ads and stigmatization
practices. This impacts the success and recognition of brands.

Opportunities within the SWOT Analysis of DHL – DHL SWOT Analysis

To increase its reach, DHL has the chance to accumulate native payers within the target market.

In most rising markets, DHL has set its footprints; however, it must grow to require advantage of
the opportunities in those markets. They have to think about their foreign provide chain that is
customer-focused.

Expanded electronic searching additionally offers an associate incentive to expand into this
market. E-commerce is thought because the way forward for retail, so DHL must expand its
provision services for E-Commerce corporations.

Threats within the SWOT Analysis of DHL – DHL SWOT Analysis

FedEx and UPS square measure the most significant competitors of DHL and square measure,
giving DHL robust competition altogether markets. Various native brands also are a substantial
threat to DHL.

Logistics is one of the significant hard-hit sectors within the space of associate economic
retardation.

A big challenge to DHL is that the whole suffers from lower and penetrating prices against
native traveller players. They are additionally ready to supply excellent service to those native
players.

Due to the introduction of technologies in industrial and rising countries, ancient services, like
letters and posts, have deteriorated.

Government Rules and rules will directly or indirectly affect the delivery and revenue of DHL.

3. CHARACTERISTICS OF THE MANAGEMENT SYSTEM IN DHL

3.1 DHL DELIVERY SERVICE

DHL is the first letters of the last names of the three company founders, Adrian Dalsey, Larry
Hillblom, and Robert Lynn. In 1969, just months after the world had marvelled at Neil
Armstrong's first steps on the moon, the three partners took another small step to impact how the
world does business profoundly. The founders began to personally ship papers by aeroplane from
San Francisco to Honolulu, beginning customs clearance of the ship's cargo before the actual
arrival of the vessel and dramatically reducing waiting time in the harbour. Customers stood to
save a fortune. A new industry was born with this concept: international air express, the rapid
delivery of documents, and shipments by aeroplane. A couple of years after the start of the
business, it began to expand the service region to Southeast Asian countries. Followed by this,
the market of DHL was expanded into the Far East and African region and finally to European
countries. In 1986, DHL entered a joint venture with the People's Republic of China and became
the pioneer of express delivery service in China. A worldwide transport network is constructed.
Moreover, nowadays, DHL not only provides simple air freight express mail services and uses
sea and land transport and contract logistics solutions.

DHL has a rapid expansion in both its business and service network. Initially, DHL provided
only mail delivery service. However, a parcel delivery service was added in the 1970s.
Moreover, the service network of DHL has been widened, compared to its beginning only
business region in the USA. In the 1970s, DHL expanded its business to Japan, Hong Kong,
Singapore, and Australia, while in 1999, it invested more than 1 billion Euros in European and
Africa for advancements in transport networks. In 2003, DHL acquired Airborne Express and
became the third-largest express service provider in the USA.
Furthermore, now, the international transport network of DHL covers more than 220 countries.
DHL is considered the global market leader in international express, overland transport, and air
freight. It is also the world's number 1 ocean freight and contract logistics. DHL offers a full
range of customized solutions – from express document shipping to supply chain management.

3.1.1 Vision and mission

DHL's vision is to be The Postal Service for Germany and The Logistics Company for the
World. DHL's mission states, "We want to be a logistics company that people want to come back
to - we will be their first choice for all shipping needs and career and investment opportunities."
Their Mission statement consists of four major elements:
 We make our customers, employees, and investors even more successful;

 We always pay respect to our associates and perform well at the same time;

 We facilitate and simplify the life of our customers;

 We contribute to making the world a better place.

DHL prides itself on prompt transportation from one place to another and needs some logistical
help - however, behind this simple truth, there are millions of stories. They postulate that as
logistics companies, they are the basis of trade because they deliver everything that needs to be
delivered.
3.2 DHL STRUCTURAL COMPOSITION

3.2.1 DHL Customer

DHL has customers covered all over the world. DHL accepts any delivery requirements, no
matter who the clients are. Furthermore, DHL segments its customer into different groups to
deeply understand the customer life cycle. Customers are segmented as strategic, long-term
relationships, and regular customers according to different customer needs. The strategic
customer has many logistics needs or complex supply chain requirements. DHL's main task in
customer development is to focus on getting new customers and maintaining a cordial
relationship with returning clients to achieve profit maximization. The company can adapt the
specific service to fulfil customer needs by understanding the customer. Usually, DHL plays the
role of a dependable partner when a customer needs them. The company always finishes its
service optimally due to its excellent personal approach. For instance, according to Dirk, the
customs experts of DHL see to it that customers' goods get to their final destination with
maximum reliability. DHL still focuses on old customers' needs to prevent losing them.

4. SWOT ANALYSIS OF THE RELATIONS BETWEEN INTERNAL AND EXTERNAL

FACTORS IN THE SURVEYED COMPANY

In analyzing the results of the DHL management system, a summary table is drawn to sow a
concise description of the findings gotten. The strength and opportunities would be regarded as
the company's competitive advantages. On the other hand, weaknesses and threats would be
discussed as competitive disadvantages.

The internal and external environment reflects positively/negatively on the business process
management of a company. The purpose of business process management is to increase the
efficiency and effectiveness of organizational processes through improvement and Innovation.
SWOT analysis is one of the methods of strategic analysis when building an organization's
strategy, as posited by Aaker102. See below for more understanding.

SWOT Analysis of DHL

STRENGTH Weaknesses
1. Large distribution Channel 1. Lack of Adequate Customer Feedback
2. Growth in developing countries 2. Price
3. Quality of delivery of services
4. Happy Employee
OPPORTUNITIES THREATS
 1. Brand Associations 1. Maintaining the leading position
2. Innovation 2. Tough Competitors

4.1.1 Strength

L. Berry stated that the company should concentrate on the customer; build long trust with its
close customer. DHL's customers are everywhere103. As a global player, DHL acts worldwide to
understand and respect different cultures as they thrive in diverse cultural communities,
including developing countries. Additionally, DHL provides short-time delivery and safety
insurance service with Hitech equipment. It brings customer satisfaction and high efficiency.
On the other hand, regarding the GOGREEN program, all transport-related emissions of carbon
dioxide would be offset through external climate protection projects. Therefore, balancing
sustainability efforts with customer expectations can be achieved by DHL. From the analysis
above, employees are pretty pleased with working for the company, and this positive attitude
reflects on the performance of the staff positively. Prompt delivery of services is also an
advantage of DHL because they have offices worldwide.

4.1.2 Weakness
Their delivery rates are relatively higher than that of other competitive brands. This has
influenced buyers' choice in using an alternative brand that is within their budget. Undoubtedly,
DHL has a good customer base as its reach worldwide is indisputable. However, some
respondents believe that the company needs to establish an effective feedback channel for all
customers. This will make customers feel important and taken seriously.

4.1.3 Opportunities
Different companies have different exclusive strategies. In this instance, DHL as a brand is
notable and well respected in society. This can work in their favour in getting investors in future
projects. Also, due to their leading position in the industry, they can easily break into new
markets worldwide and get support in developing countries. Their interest can be viewed as a
step toward economic growth.
4.1.4 Threats
The biggest challenge for DHL is to keep the leading position. Furthermore, many competitors
are trying to catch up with DHL, such as FedEx, UPS, etc. Thus, DHL needs to increase its
marketing pace as new brands rapidly catch up to them to become the Number 1 in the global
market.

5. Detail SWOT Analysis

SWOT Analysis of DHL focuses on strengths, limitations, opportunities, and Threats. DHL is one of the
largest Logistics companies. The strengths and weaknesses of DHL Swot are internal factors, while
opportunities and risks are external factors.

SWOT Analysis is a validated management tool that enables a company like DHL to measure its business
performance with competitors and the industry.

DHL is a German express mail, parcel, and courier service provider. DHL is a subsidiary of Deutsche Post
DHL. DHL delivers about 1.6 billion parcels/year. DHL was established in 1969 and expanded its business
throughout the world. DHL now has 380000 employees.

Significant Competitors of DHL are FedEx and UPS. DHL uses five airline subsidiaries and 271 Aircraft to
deliver parcels. DHL has a high-speed delivery network.

Strengths in the SWOT Analysis of DHL – DHL SWOT Analysis

 DHL has been supported by good contact and outstanding in-house consulting to expand its reach.
 DHL is ranked among the best global brands with high brand equity.
 DHL is growing its business in developed countries. DHL has invested extensively in developing
nations to set up and extend their facilities to have a broad presence in emerging economies.
  DHL has a solid f2inancial record, and it is considered to have enough finances to back it up. As a
consequence, more and more enterprises trust DHL and its services. This financial status also lets
DHL grow its year-on-year business.
 DHL projects itself as a leader in Logistics. It has structurally engaged in creating pattern analysis
and solutions and has created a DHL Innovation Hub that offers a forum for consumers and
partners to connect with DHL experts. Resillience360 and Smart Sensor were popular initiatives
for logistics systems that originated from the centre of creativity.
 DHL has good customer support.
 DHL has a sound grievance redressal system for its customers.
 DHL has a large employee base. DHL is spending a lot on the training and development of its
employees. This will help the employees work more, and the company's productivity is increasing.

Weaknesses in the SWOT Analysis of DHL – DHL SWOT Analysis

 The logistics industry requires huge investment to set up operations and grows. DHL also requires
heavy investment to grow its business and generate a return on investment.

 DHL is expected to act in compliance with regulatory guidelines and local authorities. Regulations
can be different in the source and destination locations, so it can be impossible to obey other rules.
 The logistic Market is filled with many local and international players, and the market growth is
distributed among all the players due to the high pricing strategy. DHL's market share is restricted
in developed and developing economies.
 Due to a huge market and an extensive network of delivery partners is required. DHL also depends
on small and local entities for delivery. Furthermore, this directly influences DHL efficacy, so
teamwork becomes very necessary.
 DHL has less marketing cost than FedEx or UPS and does not spend much on advertisement and
branding practices. This impacts the success and recognition of brands.

Opportunities in the SWOT Analysis of DHL – DHL SWOT Analysis

 To extend its reach, DHL has the opportunity to acquire local payers in the target market.
 In almost all emerging markets, DHL has set its footprints but needs to grow to take advantage of
the opportunities in those markets. They need to concentrate on their foreign supply chain, which
is customer-focused.
 Expanded electronic shopping also offers an incentive to expand into this market. E-commerce is
known as the future of retail. Thus, DHL needs to expand its logistic services for E-Commerce
companies.

Threats in the SWOT Analysis of DHL – DHL SWOT Analysis

 FedEx and UPS are the biggest competitors of DHL and are giving DHL tough competition in all
markets. Numerous local brands are also a significant threat to DHL.
 Logistics is one of the most hard-hit sectors in an economic slowdown.
 A big challenge to DHL is that the brand suffers from lower and penetrating costs against local
courier players. They are also able to offer excellent service to these local players.
 Due to the introduction of technologies in industrialized and emerging countries, traditional
services, such as letters and posts have deteriorated.
  Government Rules and Regulations can directly or indirectly affect the delivery and revenue of
DHL.

CONCLUSION AND RECOMMENDATIONS

Management systems are responsible for the growth and development of a company. They
encompass all company areas as each person has a role in steering the organization towards
achieving its vision of becoming a successful entity. DHL is a renowned successful brand in the
logistics industry that has strived despite the rapidly evolving transformations in the dynamic and
competitive environment. Along with globalization and the development of technologies, more
and more companies have realized today's complex, competitive situation. Increasingly, to
respond to the highly competitive environment, many companies have to look for an approach to
develop themselves from "inside" to "outside" Thus, it can be asserted that DHL's strategic
practices include maintaining quality delivery of services, maintaining their networks, and
creating new ones, investing in developing and urban societies, retaining their renowned brand
name in the market and ensuring the constant training of employees. This thesis focuses on the
management system of DHL mainly to examine practical implementations of strategies of DHL
as defined by its "Functions."

Furthermore, its effects on the market and how it is perceived were achieved by analyzing the
internal and external factors of the company. Just as Duxbury affirmed, SWOT analysis is
critical in an organization's strategic planning104. This is done to ensure a clear objective
defined for the business. This study also explored the areas DHL has strengthened to maintain its
market position by maintaining a strong customer relationship that keeps clients satisfied and
wanting more.

From the analysis, even though other brand options were available, customers still preferred
DHL to deliver their goods as the company's reach is established in most countries. Another
commendable attic of the company is its dedication to the growth and development of
developing countries. The SWOT analysis shows that they have established offices and
management running in developing countries. This no doubt creates a sustainable relationship
with the government of those countries as DHL's presence will employ in their society and
increase their awareness of international transactions. Other strengths explored include employee
satisfaction, brand associations, and financial insights. However, from the SWOT analysis
carried out in this research, one cannot affirm that the company is grounded and doing
everything right. Their high price point and low customer feedback are something to look at as
this has remained a resounding factor that no doubt reflects on the decisions of the company's
management team.

One might assume that this issue would have been handled immediately with the frequent yearly
report, but unfortunately, it has not. With the rapid rise of competitive brands and more digitally
savvy models in place as the world has become more digital, DHL has to be careful and be on
their toes in rapidly resolving the point mentioned above and put structures in place to constantly
seek customer/public opinion of the company as this will steer them to knowing the
thoughts/opinions and suggestions of customers and even noncustomers. Thankfully, the brand
has positioned itself right from the onset, as seen in the brand associations analysis of the study,
which will open them up to more investors and market reach as the brand can be tagged a
"Household Name."

The need to improve is because other brands are rapidly catching up with the trend and aiming to
be dominantly relevant in the industry. This can also be likened to the assertion of Gürel and
Aaker that the use of the SWOT analysis method in the analysis company's strategy is
determined by the thorough application and interpretation of the Internal and External factors.
From the research question, the competitive advantage of DHL includes, amongst others, a good
customer base, growth in developing countries, brand presence, and Innovation. In contrast,
DHL's competitive disadvantages are Lack of customer feedback, price, tough competitors, and
maintaining a leading positive in the logistics company. It is highly recommended that DHL
consider the competitive disadvantages seen in this research to re-strategize and increase its
chances of being number one in the business.