With numerous consumer focused courier companies establishing themselves in recent years to meet the needs of evolving online retail deliveries, couriers are no longer only associated with the business to business marketplace. Indeed, showcasing the impact that consumer demand has had on the market, new research from Mintel reveals that while in 2013, the courier and delivery market was valued at £6.62 billion (accounting for 1.83 billion packages), this year growth is expected to reach £7.1 billion – and the number of packages sent from the UK set to break the 2 billion mark to reach an impressive 2.02 billion. Highlighting the shift towards consumer usage of courier services, Mintel’s research shows a boom in demand for retail and consumer goods deliveries. Indeed, retail and consumer goods represented an estimated 39% of total goods delivered within the UK in 2013, rising from just 23% in 2009. Furthermore, in recent years, the development of the e-commerce market in the UK has driven demand for courier and express delivery services far beyond levels previously generated by mail order shoppers. Indeed, online retail sales have played a significant part in the growth of the business to consumer sector, with the online retail market experiencing growth of 86% between 2009 and 2013. As one of Britain’s fastest growing business services markets, the UK courier and express delivery market also recorded an impressive value increase of 26% between 2009 and 2013, as a result of the boom in business to consumer deliveries and driven by the surge in online spending. Volumes have also grown by 35% over the same period. Ben Harris, Industrial Analyst at Mintel, said: “The courier and express delivery market is one of Britain’s fastest growing business services sectors and the growth in e-commerce demand in the UK has protected the market through the downturn. Money that was previously spent in retail outlets is now being spent online, boosting demand for business to consumer delivery services, which is further increased by consumers also using them to return goods. Couriers are increasingly moving into the consumer landscape, with companies adapting their offering and making it easier and more attractive for people to use their services for everyday demands.” “Revenue growth has been exceeded by volume growth, demonstrating the downward pressure on prices in the market, as a result of intense competition between operators and falling average weight per package. While new market entrants and the Royal Mail privatisation are expected to increase industry competition to a new intensity, the explosive growth of online retail sales is expected to continue and it is anticipated that the courier and express delivery sector will become increasingly reliant on the business to consumer market and as a result, even more competitive.” Ben continues. And it seems growth does not stop there. Overall, Mintel forecasts the market for courier and express delivery to grow a further 38% over the next five years to reach a value of £9.10 billion in 2018 – with forecast delivery of 2.80 billion packages. Showcasing consumer demand for speed and convenience, next day deliveries have generated the greatest growth of any individual sector in the UK market. Indeed, the next day delivery sector increased by nearly a third (28%) from 2009 to 2013 resulting in the sector reaching a value of more than £3.4 billion in 2013. Next day delivery demand now accounts for 68% of the total market, up from 67% in 2009. “Growth in the next day sector is in line with both household and business expectations of speed of delivery. However, demand in the business to consumer sector is now shifting carriers’ focus away from 24 and 48-hour deadlines to specific time window slots when the customer can receive the delivery.” Ben continues. Similarly, the same day delivery sector expanded by an estimated 5% in value terms year on year to 2013 – a 19% increase since 2009. The same day sector now accounts for an estimated 10% of total market value. “The rate of expansion in same day delivery revenues is behind the overall value growth of the market, reflecting price competition in the courier sector, where rates have been under consistent pressure in 2012 and 2013. Nonetheless, demand for same day courier services has been supported by the emergence of companies, such as Shutl, which give courier firms access to a larger retail market. Demand has also come from the services sector, which has grown ahead of GDP in recent years.” Ben concludes. You might also be interested in: No related posts.