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DHL Supply Chain CEO Cites ‘Business as Usual’ as Tariffs Kick In


Tariffs have been the talk of the town throughout the supply chain in recent months, but for DHL Supply Chain, it’s just another day at the office.

“Changes in tariffs and duties, and that kind of activity, is pretty frequent around the world, so it’s not new for us to deal with a tariff landscape,” said Patrick Kelleher, the CEO of DHL Supply Chain North America. “Our system, tools and especially people, are positioned to manage that on a day-to-day basis. We’re very much business as usual as it relates to managing what is the higher volume of change.”

Headquartered in Bonn, Germany, DHL’s contract logistics wing operates in 50 countries across 1,600 warehouse locations worldwide, and is no stranger to facilitating product flow internationally, regardless of trade barriers imposed.

“I always use the analogy, ‘water finds its easiest way downhill,’” Kelleher said. “If there’s a tariff implemented—that’s a dam—the water will find a new way. And we’re about helping customers manage that change in the way that product is flowing.”

Kelleher chatted with Sourcing Journal at the Manifest supply chain and logistics conference on Feb. 12, discussing DHL Supply Chain’s direction in 2025 as well as other hot topics such as the state of the contract logistics market, the company’s recent returns acquisition and warehouse automation.

Sourcing Journal: In the wake of the Strategy 2030 launch, you consider 2025 a milestone year for DHL Supply Chain. What should we expect this year?

Patrick Kelleher: We’re going to continue to be a market leader in contract warehousing, domestic transportation, transportation management and supply chain orchestration.

From a product perspective, we are going to amplify our focus on e-commerce solutions and 4PL solutions. Returns is a big area of focus for us as well.

From an industry vertical perspective, we’re putting extra emphasis on life sciences and e-commerce/omnichannel—two market verticals that we’re really investing in significantly for accelerated growth.

SJ: Given we have a new presidential administration, which has been accompanied by a massive influx of imports into the U.S., how does this impact the contract logistics market in 2025?

PK: I do think contract logistics market is going to grow. The demand for warehouse space is continuing to increase, and we’re seeing that in the vacancy rates, in the big markets that we operate in.

Our thinking has to transcend any one administration, so we are very thoughtful, and we leverage data to make good decisions around where we’re going to add warehouse infrastructure around the U.S., and making sure that we’re doing that in a way that infrastructure can be flexible around a change of mission for a facility.

For example, a building today that is an e-commerce operation may five or 10 years from now shift its mission to be performing subassembly work or packaging work.

One of the amplified solutions that we’re seeing as a result of tariffs, and the level of activity there, is the Free Trade Zone (FTZ) solution. For the past 10 years that has really been limited to people shipping very high-value product for them to get the ROI associated with administrating an FTZ.

The price point for goods that the FTZ makes sense for is coming down dramatically. I think we’ll see the demand for FTZs and bonded warehouse solutions increasing across the U.S.

SJ: When you look at the contract logistics market today, where do you feel like the best opportunities are now?

PK: We’re focusing what I would call end-to-end supply chain orchestration, which is managing supply chain activity from the point of raw materials through manufacturing, all the way through to consumption, and then especially returns.

We have a lot of focus on the return space right now with the recent acquisition of Inmar Supply Chain Solutions. That solution can be available to people across multiple industries, so it’s not just a consumer/retail solution, but has application everywhere.

One of the things that we’re capable of doing there within the tariff landscape is recovering tariffs and duties when a product is returned. For companies that are, for example, executing business-to-consumer shipments from Poland, Mexico or China, into the U.S., if a product is returned, there is an opportunity to recover the tariffs and duties associated with that. This is a huge value to our customers.

SJ: Tell us more about the Inmar acquisition. What stood out about their ability to complement the DHL Supply Chain team?

PK: The management team was really attractive to us, as well as their in-depth knowledge of the space, and the vision that they have for the future in evolving the product.

We admire their capabilities around data analytics, and the value that their customers were seeing in the data.

We think that continues to be a huge opportunity for us in our contract logistics business overall, given the amount of data that that we’re generating and the insights that we derive from that data.

SJ: What are the current challenges experienced within the current contract logistics industry today?

PK: It’s about being thoughtful around decisions that are made in standing up additional warehousing capacity. That is an inflexible asset in terms of being able to move from one location to another.

We need to be picking the right location, making sure that is data informed, working with the breadth of customers that we have to have a good view of the different markets that we’re participating in, or should be participating in—to make those long-term investments.

SJ: There’s so much talk about warehouse automation, particularly the back-and-forth surrounding its relationship with labor. How is DHL navigating this paradigm to find that balance?

PK: That is the reason we have 1,600 technology pilots. We take a funneled approach. We try and fill that funnel pilot up. And in doing so, we’re looking to test the efficacy of the technology itself.

That could be robotics or AI, whatever the case may be, and the ability to scale it. We’re especially good at integrating how the technology works with the individuals who work in our business, so combining the technology element with the human element to deliver and maximize an expected result. If we can see an ROI there, and that comes from confirmation from our people, that a green light to move the pace, to roll technologies out.

We have a team of solution design engineers that are talented at evaluating technologies like that on paper, and we have great customer partners who are willing to pilot. When we can prove it out on paper, then as quick as we can, we want to get it into an operation where it’s where it’s performing some activity, and we can quickly, within couple weeks or months, assess whether or not it’s going to work.

We don’t do two- or three-year pilots. We’re not afraid to fail, and that’s how we find what we’re looking for.



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