He comes across as modest and likeable in the interview. It soon becomes clear that Gergely Farkas, Managing Director Europe East, has ambition in spades – although not for himself. His goal is outstanding quality in the region he manages.
“Delivering as promised – that’s our strength”
Mr Farkas, is it true that you started your career as a depot worker?
(He laughs) Yes and no. I helped get General Parcel Hungary up and running. Back then, the company handled 40 import parcels a day. In such a small company, everyone does everything. I worked in customer service, helped out as a parcel pusher in the sorting hall and loaded or unloaded vehicles. I still occasionally do this kind of work today; after all, it’s all part of parcel logistics.
Is it hard to find employees and delivery drivers in south-east Europe?
This has indeed been a challenge for years, also for our transport partners. It’s all to do with the strong employment figures. The Czech Republic, for example, has the lowest unemployment rate of anywhere in Europe – less than two per cent. The rates in Hungary and Romania are below four per cent. A labour market of this kind means rising wage costs, of course.
How have the six Europe East countries for which you are responsible developed in recent times?
All countries have seen double-digit growth in both revenue and parcel volumes. GLS is now among the top four parcel companies in all the region’s markets. The market situation is good. We have economic growth – and purchasing power and private consumer spending have both risen. More and more goods are being bought online. And as we are very strong in the e-commerce segment, we are, of course, benefitting from this situation.
The share of e-commerce consignments is very high in your region compared to other GLS regions. How did this come about?
It’s true that we have an average 2C share of about 70 per cent – more in some countries, less in others. It all started when we acquired our first e-commerce customers in Hungary back in the year 2000, when we were still a very small operation. We have gradually built up our delivery services to private households ever since.
What exactly makes you so strong in the field of e-commerce shipping?
We offer more services than our rivals – and different services, too. Let me give you an example: in our region, many end customers pay by cash on delivery. That’s why this service is offered pretty much as standard. What sets us apart, however, is that we offer cash on delivery for international consignments between all six countries. What’s more, the recipient can make a payment with the delivery driver using their debit or credit card. The FlexDeliveryService is a key element of our B2C services, as are our ParcelShop networks and automated parcel terminals.
But the most vital factor is our unwaveringly high quality. Our delivery rates are just as good in December, when other companies struggle – even though on peak days, parcel volumes are more than three times above the annual average. Whether Black Friday or the week before Christmas: we deliver quickly and reliably as promised, with delivery times of 24 to 48 hours across the region – including for cross-border shipments. This quality is our greatest strength.
So peak season always represents the biggest challenge?
Yes, definitely. Most online shops generate the lion’s share of their profit during this period and cannot afford any problems. That’s why we prepare meticulously; this year, the work began in January. Pretty much everything has to be considered: staff levels, vehicles, IT, capacity at the various sites. Last year, we opened several new depots, thus expanding our network across the region. The hub in Budapest was enlarged – and we are doing more construction work here this year. We are investing an amount in the double-digit million range to ensure that we can handle 30,000 parcels an hour in peak periods. We will also be adding new depots.
What is your main aim for this financial year?
To maintain our high quality levels as we continue to grow rapidly. That’s what matters most to me.
As Managing Director Europe East, Gergely Farkas has been responsible for the six countries in his region since 2011. The 43-year-old trained economist joined GLS in 1998, straight after his degree, helping to get General Parcel Hungary off the ground. In 1999, he was appointed Operations Manager for GLS Hungary, in 2004 for the entire Europe East region. He has never regretted staying with one company for more than 20 years.
Europe East: six countries – one entity
GLS has been operating in Hungary since 1998, starting out as General Parcel Hungary. What is now GLS Hungary paved the way for the launch of further start-up ventures in the region: GLS Slovenia (2000), GLS Slovakia (2004), GLS Czech Republic (2005), GLS Romania (2007) and GLS Croatia (2013). Together, they draw on combined knowledge and close cooperation.