Expert's view on Russian express delivery and logistics market

How would you characterize today’s Russian express delivery and logistics market?

The Russian express delivery and logistics market continues to grow. This process is being facilitated by several factors, including the stability of flow of clients from businesses and government agencies, which in the process of optimization of their activities, often outsource some of the tasks to courier firms. Other growth drivers include active development of e-commerce that is being fueled by the spread and penetration of Internet into Russian regions and CIS countries. However, legal entities have continued to remain express-delivery firms’ major clients. At the same time, one needs to note the increasing demand for express-delivery services in the B2C segment, which is expected to be equal to the volume of services in the B2B segment in the non-too-distant future. On the whole, there is a large potential for further growth in this industry. However, despite these positive trends, today, we still cannot call our industry a fully developed logistics market. Therefore, in the near future, one of the industry’s future growth directions will be development and improvement of regional infrastructure.

What differentiates express delivery from the other types of logistics services?

Promptness and efficiency are the main features of express delivery that differentiate it from the other types of logistics services. Along with reliability, the priority of express delivery is the strict fixation of the timeline limit, during which we guarantee the delivery of goods to the addressees. All these features have led to the creation of an entire industry, including, the development of large transportation and warehousing infrastructure, constant optimization of routes and retention of professional staffs.

How, in your opinion, will Russia's expected membership in WTO change this industry, and what are the pros and cons of such changes?

Russia's accession to the WTO does not pose any threat to us. This is because most major global logistics firms are already operating in Russia, and despite this, we’ve been able to remain competitive. However, Russia’s WTO membership is expected to lead to a significant increase in trade, which will open up new business opportunities, increase customer flow and demand for new logistics and express delivery services.

“The key to PONY EXPRESS’ success in this industry is thorough market knowledge, reliability and constant development.”

Today, PONY EXPRESS is one of the market leaders, a huge feat in Russia’s business conditions. So, how would you, briefly, explain such success?

PONY EXPRESS, an affiliate of the Basic Element holding, is a national operator on the express-delivery market. The key to our success is thorough market knowledge, reliability and constant development. For over 20 years, we’ve been open for cooperation and striven to listen to customers, offering them the right services at affordable prices. We’ve adopted the right business strategy, which envisages constant upgrading of all the components of our business processes and create a competitively capable business model, which has long proved its effectiveness.

Competition is very high as all types of players are present in this sector. In this context, what are your main competitive advantages?

PONY EXPRESS, the most developed among regional courier companies, currently has a network of over 145 agents and 40 branches across Russia, as well as subsidiaries in Ukraine and Kazakhstan. It has park of vehicles and an extensive system of air and land routes that enable it to promptly deliver cargoes to any locations in Russia and CIS. We are constantly improving the quality of services and using cutting-edge technologies. Also, we control every stage of order executions, while our high level of management has been confirmed by the ISO 9001:2008 international standard. We’ve confidence in the professionalism of our employees and care about their further education. Besides, PONY EXPRESS’ transparent pricing policy enables clients to accurately predict their orders rates and special discounts, thus getting high quality services at competitive prices. All PONY EXPRESS’ services are specially tailored to meet clients’ individual needs. Thus, clients can personally form their service portfolios, choosing from a large pool of proposals. These include making deliveries at a specific time, day, or choose different delivery options – express and economy class, as well as from a large number of additional options and service packages.

If briefly put, and based on your experience, taking into account the Russia’s specific business conditions, how would you formulate the ideal business model in this industry?

The ideal logistics business model is the one that is capable of uniting the interests of operators and customer needs, allowing both to grow, increase profits and expand their operations’ geography, thus contributing to the modernization and growth of the industry, as well as improving the overall business climate in the country.

What are your plans and business development strategy for the future?

Today, PONY EXPRESS’ priorities include a rapid expansion of operation networks in and outside Russia. Also, we plan to create a modern logistics complex and equip it with new IT-solutions that will enable us maintain our status of a 3PL-operator. As a part of development of business in the segment B2C, we see collaboration with online companies as strategically important. This is because the e-commerce segment is gaining popularity and expanding its geography every year.