Elderly, 5G and e-B2B: 2022 trends for e-commerce

THE CORE OF DHL EXPRESS’ GROWTH HAS BEEN E-COMMERCE AND WITH THE BOOST EXPERIENCED DURING THE PANDEMIC, THE COMPANY WILL FOCUS ON ONLINE SALES TRENDS IN THE COMING PERIOD. “THE TRENDS IN 2022 IN E-COMMERCE WILL BE THE ELDERLY, 5G AND E-B2B,” SAYS MUSTAFA

anniversary in Turkey, DHL CELEBRATING ITS 40TH

Express recently opened the doors to its new EUR 135m facility at Istanbul Airport exclusively for daily DUNYA. The center, which has not yet been officially opened, boasts some of the most advanced technology in the sector and will, according to DHL Express Turkey’s newly-appointed CE•, raise the bar for global logistics.

The new building will be sufficient for the business volume of DHL Express Turkey for another 20 years but already the company is preparing for a new investment at Sabiha Gokcen Airport, Tonguc says. The core of DHL Express’ growth has been e-commerce and with the boost experienced during the pandemic, the company will focus on online sales trends in the coming period. The trends of 2022 in e-commerce will be the elderly, 5G and e-B2B, according to Tonguc.

New trends are emerging as e-commerce grows, Tonguc adds. Companies in the sector have to be elderly-friendly because the people who can spend more money are over 50 years old. Another trend is 5G investments, because for Industry 4.0, more machines need to communicate with each other faster. The third important trend is B2B e-commerce. “B2B companies normally go to trade fairs or get in touch via e-mails for trading. But in fact, companies should be able to make purchases like an e-commerce customer. In this way, customers can buy products without speaking to you, and secondly, you do not spend a lot of money on fairs,” Tonguc says.

“So, we have started encouraging our customers to use e-B2B. Let’s see who will be our first e-B2B customer for e-commerce.

Tonguc: “The technology used in this building does not even exist in our Leipzig Hub. 20% of our building investment is fully toward digitalization. We established the ASRS (automated storage and retrieval system), where customs clearance shipments are prepared untouched. DHL Turkey has developed a business that will be a model for the world in this respect and it will be tried in China after us. When you go to clearance areas, a warehouse, someone puts the shipment on a shelf or, if it’s heavy, puts it away by forklift. Here, 80% of our shipments are placed somewhere with robots, and when requested, they are picked up by robots and given to you. The process, which normally takes 15 minutes, drops to 2 minutes, decreasing waiting times and increasing productivity by 80%. While 100 people are currently working in that part of a warehouse, we will need maybe 15 in our new location. But our building has grown so much that we will continue to work with that staff in other areas. We will also start the export business. We were already doing it but we never had a warehouse on the tarmac. This will be a first in Turkey. As DHL Turkey, compared to our infrastructure

5-6 years ago, we have made the biggest evolution with the investment we made in this building.”

We look forward to seeing this. 10% growth in B2B sales is a big deal. With e-commerce, this can quickly increase to 50%. For example, Walmart can buy a product from a company just like an individual shopper adding it to their basket.”

Tonguç also says that e-B2B is a new game for them. “This is an area we just launched. We will see the effect in the last quarter. We think that real growth will come in 2022.”

DOUBLE DIGIT GROWTH IN 2020

DHL Express is a global company and since it manages shipments, it can also follow global and country specific trends closely. The COVID-19 related closures that started in China in February last year, and then Spain and Italy, resulted in bad financials for the company in the March-April period. The biggest hit came from Italy where DHL Express shrank by 50% in April. However, Tonguc says, it came to a breakeven point with the previous year in May. “We started to grow after June, mostly driven by e-commerce. We grew by double digits at the end of 2020 and made a successful start to 2021.”

TURKEY’S DIFFERENCE IS ‘RESILIENCE’

Tonguc also says that by looking at shipment traffic they see the textile industry is growing and automotive suppliers are increasing their business despite the shortage of computer chips. “The difference in Turkey is that it showed growth in B2B transactions despite this segment’s slow down globally. There is a double-digit growth in B2B even compared to 2019. Turkey’s difference from other countries is ‘resilience.’ We are a country that quickly turns crises into opportunities. We try to provide a lot of training to our customers. These efforts contribute to the exports of both our customers and Turkey.”

SABIHA GOKCEN UNIT TO BE OPERATIONAL BY 2023

Tonguc points out that flights have decreased due to the pandemic, but Istanbul and Sabiha Gokcen airports performed very well compared to others, entering the top five and top 10 lists globally. The volume of cargo shipments decreased due to a decrease in flights, resulting in a capacity problem in the sector, he says. There were also problems in the maritime sector. “The ship stuck in the Suez Canal, for instance…All these had a huge impact on international trade.” However, Tonguc notes that there were investments during this period. “For example, our investment here at the Istanbul Airport will easily meet our business volume for the next 20 years. We also signed a protocol for Sabiha Gokcen Airport. We will open our new building, which is only 30% smaller than this one, by 2023.”

“We have to make investments faster and sooner and grow faster than the market. With the normalization around the world, e-commerce will not shrink.

Only the growth rate may decrease. This will now be the new normal. We are accelerating our investments,” he says.

U.S. AND AUSTRALIA FAVORITES AFTER VAT 22

One of the most important issues on their agenda is VAT 22, the change in EU taxation where the VAT exemption for imported goods whose value does not exceed EUR 22 will be abolished, Tonguc notes. The EU has announced that VAT 22 will be effective from July 1, 2021. “Turkey is among the countries that sent the most shipments under EUR 22 to this region. We started training our customers very early on this issue. With the correct invoices, shipments can be delivered on time.”

Most Turkish retailers are now looking to the U.S. as an alternative, where the VAT exemption applies to shipments under USD 800. “The U.S. has become one of the countries to which we send the most shipments. In the future, Australia will also have this attraction. Those who turn to these countries will be lucky.”