17th December, 2020, Bath, UK – Ti’s new report Global Express & Small Parcels 2020 shows that the market has achieved accelerated growth where all other logistics markets have contracted in 2020.
Over the course of 2020 the integrators have benefitted greatly from the market’s growth, especially through Q3 as the economic bounce back took hold and many shippers resorted to using express networks because of tight air freight capacity. The surge in volumes moving through express networks through Q3 has helped push up revenues, with DHL reporting a 14.6% y-o-y increase and UPS showing a 15.5% y-o-y increase in Q3. Margins have also held up strongly with the volume and revenue rises.
Express providers have seen particularly strong growth in their international business and Ti’s latest report expects growth in cross border e-commerce to continue drive that expansion through to 2024 and beyond.
In domestic markets, B2C e-commerce and on-demand delivery services have also seen a surge as consumer behaviour shifts faster than ever with Covid-19. This has driven a strong growth for the integrators but also a host of new technology start-ups which have been able to use their technology to leverage new flexible employment and delivery models. Ti’s new report provides insights into the new opportunities in on-demand and grocery delivery, showing how these trends may benefit the likes of Alibaba, Amazon and Walmart, rather than the traditional last mile players.
Andy Ralls, a quantitative analyst at Ti said: “Global express has seen accelerated growth amid the Covid-19 pandemic. Whilst consumers will return to shops more in the years ahead, elevated levels of e-commerce sales are here to stay, which is good news for B2C parcel deliveries, both on a domestic and international basis.”
With surging cross-border and domestic e-commerce, alongside the rise of on-demand and grocery delivery, peak season 2020 is expected to be record-breaking. In anticipation, retailers are trying to spread demand over several weeks by launching promotions earlier than they have previously. Alternative delivery solutions are becoming more critical as consumer behaviour changes. Retailers are likely to experience shortages of in-demand products and an influx of products previously forecasted to be the “big hit” in 2020. Returns policies carry a heavier weight this peak season. Both logistics providers and retailers will need to strategize to ensure a quick turnaround of returns to ensure profit margins are maintained as much as possible.
Ti’s latest report, Global Express & Small Parcels 2020, offers full analysis of the express & small parcels market: https://www.ti-insight.com/product/global-express-small-parcels/
About Transport Intelligence (Ti)
Transport Intelligence (Ti) is one of the world’s leading providers of expert research and analysis dedicated to the global logistics industry. Utilising the expertise of professionals with many years of experience in the express, road freight and logistics industries, Transport Intelligence has developed a range of market-leading web-based products, reports, profiles and services used by many of the world’s leading logistics suppliers, consultancies, banks and users of logistics services.
For further information, please contact Michael Clover, Ti’s Head of Commercial Development, [email protected]