The e-commerce boon


  • Smebiz
  • Monday, 26 Mar 2018

THE growth of e-commerce has certainly boosted the courier services industry.

Reports note an increase in the number of items that are being delivered annually, not just in Malaysia, but globally.

In its Courier and Express Delivery UK 2017 report, research firm Mintel noted a significant rise in delivery in the UK.

“While the number of items delivered has soared, this has driven a boom in the value of the courier and express delivery market, increasing by 63% from £6.2bil in 2012 to £10.1bil in 2016.

“And while value sales grew by a speedy 11% in the last year alone, in 2017, sales are expected to reach £10.8bil. What is more, the market is forecast to grow by 22% to reach £13.2bil in 2021, with market volumes expected to increase by 33% to reach four billion packages in the same time period,” it said.

When it comes to delivery, growth has also been driven in the market due to consumers wanting their parcels and packages as soon as they have been ordered, the report added.

“The value of next day deliveries reached £5.5bil in 2016, up from £3.1bil in 2012. Meanwhile same day deliveries have risen from £488mil in 2012 to £1bil in 2016,” it said.

While the overall industry has been seeing good growth in recent years, one of the more significant changes that Mail Boxes Etc (MBE) Malaysia director Brian Chow has seen is the rise of the consumer-to-consumer (C2C) segment.

“When I first brought the franchise into the country, the industry mainly handled parcels in the business-to-business (B2B) segment. So this is the biggest change we’ve seen over the years, thanks to e-commerce,” says Chow.

And with more consumers now needing the services of courier providers, Chow notes that courier companies have become more willing to explore last-mile strategies.

“Consumers expect courier companies to outperform. So they are looking at ways to shorten the delivery time from 2-3 days to 24-hours to same-day delivery,” he says.

Although a fast growing segment, the C2C segment remains a relatively untapped one in the local logistics industry. In comparison, Chow says the retail delivery services segment makes up a significant component of the delivery market in mature markets like the US. In Japan, retail delivery services reportedly make up an estimated 15% of the nation’s logistics market.

In Malaysia, C2C is still a very small segment and this means opportunities to develop that is aplenty for service providers looking to grow their business.

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