The market for courier and express delivery hit £10.1 billion last year with Brits sending 2.8 billion packages, according to new research from Mintel. The rise is a £1 billion rise on last year. The number of parcels has risen by 65% since 2012 when 1.7 billion were sent.
The market will grow further, according to Mintel, with sales this year expected to reach £10.8 billion and rising by 22% to hit £13.2 billion by 2021 with the number of packages expected to rise by a third to 4 billion in the same time period.
British online retail sales are expected to grow by 55.3% over the same five-year period to hit £81.94 billion, further fuelling the rise.
“The crux of the recent surge in courier and express delivery services surrounds the ongoing digitalisation of all consumer behaviour, in which e-commerce is the apex,” said
Marco Amasanti, business-to-business analyst at Mintel, said: “As online channels continue to increase their grip across retailing, the industry is only expected to grow further as supply strives to match surging demand. Money previously spent in retail stores is now increasingly spent online, boosting business-to-consumer delivery demand not only through the initial purchase, but also through the return of goods bought online. The business-to-consumer sector, underlined by the rise in e-commerce will be key to future growth,” he said.
The new report also shows that customer immediacy is driving demand. The value of next day deliveries reached £5.5 billion in 2016, up from £3.1 billion in 2012. Meanwhile same day deliveries have risen from £488 million in 2012 to £1 billion in 2016.
But the report highlights area of dissatisfaction too. One in six (15%) users have had to wait a long time for a parcel to be delivered in the past six months, rising to 30% of those aged 16-24.
“Convenience, in particular the importance of saving time, has become key to consumer demand,” said Amasanti. “It is clear that demand for convenient time windows is significantly more prevalent among younger Brits. Convenience has gradually pervaded these generations, and established itself as a norm and benchmark in the market. Operators that target a younger market must acknowledge these growing expectations, and shift focus onto customer service accordingly,” he said.
Whilst long wait times were the biggest frustration for users this was followed by a parcel being left in an unsafe place (13%) and the parcel not being delivered in the agreed delivery slot (11%). One in 10 (10%) users have experienced a parcel being lost in the post, while slightly less (8%) have suffered damage to the contents of the parcel.
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