arvato Russia

arvato
… the spirit of solutions
Intra logistics in Russia –
Opportunities and Limitations
CeMAT, 19th May 2014
Stephan Schierke – arvato SCM
Agenda

Opening remarks

A few words about …



… arvato AG
… arvato Russia
A thesis …
... and an attempt to proof it.

Opportunities & Limitations
2 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Opening Remarks
PORT / TRANSPORT
LOGISTICS / SPECIAL
LOGISTICS FORUM
3 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Opening Remarks
WAREHOUSE
LOGISTICS / SPECIAL
LOGISTICS FORUM
4 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Opening Remarks
Are there any differences between Russia
and other countries ?
Yes, there are …
5 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Opening Remarks
Are there any differences between Russia and other
countries with respect to intra-logistics ?
Yes, there are …
6 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Agenda

Opening remarks

A few words about …



… arvato AG
… arvato Russia
A thesis …
... and an attempt to proof it.

Opportunities & Limitations
7 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
arvato is the services division of Bertelsmann
Revenues
Operating EBIT
Employees
5,889 million
€
1,137 million
€
2,655 million
2,065 million
4,414 million
1,123 million
11,838
10,819
66,410
6,201
€
309 million €
11,589
8 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
€
146 million €
€
244 million €
€
41 million €
arvato manages processes between
client and customer
customerspecific E2E
solutions
9 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
arvato has a global setup and a local approach
France:
Atton
Bonneuil
Bussy
Douai
Issy les Moulineaux
Laxou
Le Havre
Lens
Lille
Lognes
Marcq en Baroeul
Metz
Noyelles Sous Lens
Paris
Poitiers
Strasbourg
Torvillers
Troyes
Vendin
UK:
Belgium:
Netherlands:
Poland:
Beverley/ Willerby
Birmingham
East Riding
High Wycombe
Liverpool
London
Twickingham
Antwerp
Brussels
Zaventem
Abcoude
Hilversum
Venlo
Venray
Plewiska
Szczecin
Poznan
Blonie
Warsaw
Gadki
Malmö
Tallinn
Kitchener
Yaroslavl
Dublin
Czech Republic:
USA:
Berryville
Dallas
Dulles
Duncan, SC
Horsham
Louisville, KY
Mountain View
New York
Pleasant Prairie, WI
Reno
Valencia, CA
Weaverville, NC
Brno
Mlada Boleslaw
Prague
Stochov
Vienna
Lisbon
Porto
Changchun
Budapest
Barcelona
Madrid
Malaga
Turkey:
Casablanca
Marrakesh
Switzerland:
Adligenswil
Baar
Pratteln
Rotkreuz
Schlieren
Monterey
Bergamo
Milano
Athens
Ankara
Diyarbakir
Istanbul
Izmir
Beijing
Shanghai
New Delhi
Hangzhou
Xiamen
Gurgaon
Shenzhen
Hong Kong
Manila
Guangzhou
Bogota
Bangkok
Germany:
Baden Baden
Berlin
Bonn
Brandenburg
Brühl
Chemnitz
Cottbus
Dortmund
Singapore
Düren
Düsseldorf
Eiweiler
Erfurt
Ennigerloh
Eschborn
Frankfurt a. M.
Freiburg
Gilching
Göppingen
Grefrath
Gütersloh
Hamburg
Harsewinkel
Herne
Herzebrock
Clarholz
Heusweiler
Eiweiler
Ingolstadt
Korbußen
Kornwestheim
Marienfeld
Meerbusch
Monheim
München
Münster
Neckarsulm
Neubrandenburg
Neuss
Nürnberg
Potsdam
Rostock
Schwerin
Senftenberg
Springe
Stuttgart
Stralsund
Trier
Verl
Versmold
Wiesbaden
Wilhelmshaven
Wolfsburg
Wuppertal
São Paulo
Buenos Aires
Port Elizabeth
Sydney
selected sites as from 2011
10 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Since 1997 we steadily improved our Russian
footprint - today our network covers all ’11’ time zones
Yaroslavl DZB
48,200 sq m
Yaroslavl YPK
24,000 sq m
Yaroslavl Shedrino
3,100 sq m
Moscow co-shared
warehouse, 500 sq m
+ 99 PUDOs (Depots / Field Stocking Locations)
11 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
arvato Russia - services & clients
(excerpt)
Import
Print &
Replication
Warehouse &
Distribution
NN Leading
IT company
12 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
E-Commerce,
Fulfillment
Financial
Services/
CRM
Spare Parts
Logistics
We are an SCM Full Service Provider in Russia
EXAMPLE
Integrated Mail Order & E-Commerce Supply Chain (>220.000 SKUs)
Fulfilment
BPO
Consult
Marketing
Support
DataMgmt.
Warehousing
13 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Pick & Pack
Dispatch
Delivery
Postal
Mgmt.
Financial
Services
B2C
Customer
Mgmt.
Example: Wincor Nixdorf
Distribution for time critical
spare parts for private
banking equipment.
Our challenge




Set up distribution for time critical spare parts covering all Russia..
Ensure transparency in the supply chain.
Solve the issue for non-accounted returns
Customer support for 7 time zones
Key figures
 Start in 2012
 97,5% deliveries on time.
 99,7% on time shipment
1-3 days lead time in central
Russia, 5 days in distant regions.
Our solution





Set-up a central warehouse in Moscow
Set-up 107 local warehouses to comply with high service level requirements
Integrate all partners in a common IT platform.
Forward shipment includes the paperwork for potential return of the part
Call center working from 12 pm to 8 pm supports the clients in all serviced regions
14 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
 Spare parts delivered 1.6 days
ahead of agreed lead times
 Almost 1,000 part numbers in
active stock
Agenda

Opening remarks

A few words about …



… arvato AG
… arvato Russia
A thesis …
... and an attempt to proof it.

Opportunities & Limitations
15 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Thesis CeMAT Moscow 2011
“Intra Logistics Depend on External Factors”
Services follow customer
Representation & Russian subsidiary
Greenfield vs. Brownfield
Expatriates / Know how transfer
Who comes late, will be punished by life.
M. Gorbashov
Customs & Taxes
Roads & Fools
Compliance vs. Corruption
People & Productivity
16 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Thesis CeMAT Hanover 2014
1. Compared to Western Countries the benefits from
automation ( = importance of intra-logistics) are
limited in Russia.
2. This is especially true for 3PL provider.
3. However, there are two exceptions.
17 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
In Russia there are fewer benefits from automation …
level of
automation
RUSSIA
GERMANY
level of
automation
high
GERMANY
high
labor costs
low
low
level of
automation
RUSSIA
schematic
representation
high
RUSSIA
high
RUSSIA
GERMANY
high
high
low
18 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
low
level of
automation
GERMANY
low
Cost of floor spac
low
quality
high
level of
certainty
low
low
high
In Russia there are fewer benefits from automation,
are there ?
schematic
representation
RUSSIA
level of
automation
GERMANY
MOSCOW
1st Exception
high
labor costs
cost of floor space
quality
level of certainty
low
low
19 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
high
“Russia” wants to close the gap …
“Russia” =
Russian companies
Russian entrepreneurs
Russian government
Gap = backlog in
infrastructure
Dream vs. Reality
Germany
20 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Russia
… and some Russians simply build their dream
Where the money is there are no limitations …
 The best’s just good enough for my operations
 Imposing others
 Keeping up with the Joneses
 Simply a hobby
21 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Dream vs. Reality
Germany
Russia
Opportunities & Limitations
for vendors and users
- Limitations
-
The maths (fewer benefits)
Authorities
Corruption
Employees
+ Opportunities
+
+
+
+
+
22 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Moscow
Where the Money is …
Growth
Investment backlog
No “legacy” hurdles
Thesis
1. Compared to Western Countries the benefits from
automation ( = importance of intra-logistics) is limited.
2. This is especially true for 3PL provider.
3. However, there are two major exceptions:
a. Moscow
b. Where the money is …
23 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014
Thank you for your attention.
www.arvato-russia.com
24 | Stephan Schierke | arvato Russia| CeMAT| 19th May, 2014