FRANKFURT – The world’s largest contract logistics provider, U.S.-based GXO, said on Wednesday it hoped to significantly increase its share of sales in Germany over the next five years with warehouse-related services in Europe’s largest economy.
GXO, which was spun off from U.S. logistics company XPO and went public last year, recently agreed to buy Britain’s Clipper Logistics for around $1.3 billion to tap into rising demand for warehouse space around the world.
“With the acquisition of Clipper, we are creating the conditions to have a stronger presence in the German market and reach critical mass,” GXO Chief Strategy Officer Neil Shelton told Reuters in an interview.
He also said the company was not affected by higher energy costs after Russia’s invasion of Ukraine, while rising labour costs increased demand for automation GXO can offer in its warehouses.
Shelton added the company, which manages outsourced supply chains in addition to warehousing, was not dependent on the pandemic-related online retail boom.
“We have contracts with brand manufacturers who want to bring their goods closer to the consumer,” he said. “We personalise the products, assemble them and send them on their way to consumers,” he said.
Shelton added he also sees opportunities in the food market, where GXO already works with the French supermarket giant Carrefour.
“New technologies will give the business a further boost,” Shelton said. “Robots can speed up and improve the handling of food.”
The customers of GXO, which competes with the contract logistics unit of Germany’s mail carrier Deutsche Post, include Zara, Zalando and recently also the German online pet shop operator Zooplus.
(Reporting by Matthias Inverardi; Writing by Zuzanna Szymanska; editing by David Evans)