Online trading has increased rapidly during the pandemic. The e-commerce logistics sector has benefited from this. We asked our Berlin branch manager Robert Weckwerth about developments and the effects of the pandemic and Brexit on e-commerce logistics. The Berlin branch has focused on the area of e-commerce logistics and offers well-thought-out e-commerce concepts with warehousing options.
What were the big developments in e-commerce logistics in the last 12 months, what impact did the pandemic have on these? And what effects did Brexit have?
In general, ecommerce shipping grew by around 25% in 2020 compared to the previous year. No other year has given digitalization such a huge boost as 2020 and gave online retail a real record year. The challenges lay in different areas. On the one hand, due to the local lockdowns in Europe and the border closures, there were massive drops in capacity (75%) and drastic rate increases (sometimes up to 150%) – this particularly affected the first two quarters. The regular throughput times could often no longer be maintained and increased from two to five days. Due to the ongoing pandemic, it was not easy for us to always have enough handling staff. In the wake of Brexit, a lot has changed for us, which means that goods under customs seal are also being re-exported. A bonded storage facility is the next step that we have been focusing on since 2020 for exactly these procedures. The Brexit agreement came about very surprisingly at the end of 2020, as did the suspension of the T procedures and the current customs and import procedures. January 2021 was an extremely busy month operationally and we worked 24/7 to implement the transports with Great Britain. Routine is slowly returning to our daily business and we have been able to specialize here.
How have your e-commerce activities grown in the last 12 months and what do you expect for 2021?
For Quick Cargo Service, 2020 was a very successful year in the e-commerce sector. We were able to increase our sales in this segment by around 35 percent. We were able to extend some important customer contracts – including with the British fashion retailer asos and new customers in the area of garden centers, hardware stores, erotic shops, medical supplies shops (including masks) and the like gain. QCS has been active in the e-commerce business for years and has been able to gradually expand its expertise in this sector over the last five years. We initially started with China Import (B to B) and China Export (B to B and B to C).
The biggest challenge for us as a freight forwarder was always the B to C shipments. The reason is the high amount of work, the required permits and the Postal Protection Act. The biggest challenges are in particular the cost calculation and allocation to the per kg price and the system-technical recording of customer master data and goods information.
Today nothing works without appropriate customs approvals and sophisticated handling/customs programs.
The amounts of data and numbers of shipments must be imported and processed in the shortest possible time.
This requires specially trained staff and software that integrates all clearance processes and customs. The search for new software that is optimal for us has been our main focus in the last few months, as well as the ongoing training of the staff.
For 2021, our focus is on the further development of our existing e-commerce customers, for example on additional routes and on expanding activities for this sector in general. We continue to plan to increase our storage capacity.
Last year saw some of the biggest e-commerce spikes. Should we expect these as the new normal or were they simply a result of the pandemic?
Ultimately, of course, due to the long lockdown, a significant proportion of private consumption shifted to the Internet – private spending was shifted, for example from vacation trips to gardening equipment and sports equipment. These effects can of course be felt in e-commerce and e-commerce logistics. The entire online trade has received a sustained boost, but I still think that some spending will shift back to stationary retail. It can also be assumed that the aftereffects of the pandemic will lead to higher unemployment and thus lower unemployment income available for consumption. This could slow down the positive development.
How is e-commerce changing brick-and-mortar retail? What about warehouse space, is there currently enough inventory in the markets you operate in and is there enough space to develop new warehouses?
Due to the lockdown in the second half of the year, inventory rose sharply and our warehouse was at 150% capacity, which led to storage capacity bottlenecks. In February 2021, the situation eased somewhat and warehouse flows became more fluid again. Inventory management always involves a lot of effort and precision. Our partner in England and we used the time and invested in new software here too. The software is intended to optimize workflows and data flows and expand the range of services in the area of tracking.