Table of Contents
Executive Summary
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- The market
- Courier services fill the gap and see gains from the COVID-19 outbreak
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- Figure 1: Forecasted value of the UK courier and express delivery market, pre- and post-COVID-19, 2019-24
- Impact of COVID-19 on courier and express delivery services
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- Figure 2: Expected impact of COVID-19 on the courier and express delivery sector, short, medium and long-term, 29 April 2020
- Companies and brands
- The consumer
- Courier and express delivery usage
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- Figure 3: Courier and express delivery usage in the past six months, February 2020 (% of respondents)
- Online shopping drivers
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- Figure 4: Most important factors behind ordering online, February 2020 (% of respondents)
- Return service usage
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- Figure 5: Return service usage, February 2020, (% of respondents)
- Delivery pass uptake
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- Figure 6: Delivery pass uptake by product category, February 2020 (% of respondents)
- What we think
The Impact of COVID-19 on Courier and Express Delivery Services
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- Short, medium and long-term impact on the industry
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- Figure 7: Expected impact of COVID-19 on the courier and express delivery sector, short, medium and long-term, 29 April 2020
- Opportunities and threats
- Newly acquired warehouse space could provide a lucrative revenue stream
- Shift in distribution of food and drink presents opportunities for couriers
- Opportunity to kick-start smart parcel deliveries
- Impact of COVID-19 on the courier and express delivery market
- Market to receive bounce in 2020 as delivery becomes the default option
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- Figure 8: Forecasted value of the UK courier and express delivery market, pre- and post-COVID-19, 2019-24
- How the crisis will affect courier and express delivery’s key consumer segments
- How a COVID-19 recession will reshape the courier and express delivery sector
- COVID-19: UK context
Issues and Insights
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- The COVID-19 shock will lead to rapid short-term growth in the sector
- The facts
- The implications
- Pressure of competition is lowering prices but adapting operating model is required for it to remain viable
- The facts
- The implications
The Market – What You Need to Know
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- The Brexit resolution and past planning shores up consumer spending and sectoral investment
- Lower revenues despite growing volume is the result of intense competition
- Market to continue riding the ecommerce wave for the foreseeable future
Market Size
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- Consumer spending holds sector steady as headwinds lift temporarily
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- Figure 9: UK courier and express delivery market value, 2015-19, (£ billion)
Market Segmentation
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- International volumes and revenues outpace domestic growth on ecommerce wave
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- Figure 10: Annual measured parcel volume*, 2014/15 – 2018/19 (millions of parcels)
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- Figure 11: Annual revenue of national parcel operators*, excluding letters and same day delivery**, 2014/15 – 2018/19 (£ million)
- Next-day popularity is growing while cost is declining
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- Figure 12: Next day and later than next day deliveries as a share of total parcel volume and revenue, 2014/15 – 2018/19 (% of total)
Market Forecast
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- Increased online shopping to drive record jump in 2020
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- Figure 13: Forecasted value of the UK courier and express delivery market, pre- and post-COVID-19, 2019-24
- Figure 14: Forecasted annual growth in UK courier and express delivery market value, 2020-24
Market Trends
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- Per parcel revenue declines due to subcontractor competition
- Electric vehicle uptake
Market Drivers
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- Demand for return boosts volumes at retailers’ expense
Companies and Brands – What You Need to Know
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- Sector remains dominated by micro-firms acting as contractors
- Green innovation steps up a gear as the 2035 deadline begins to cast its shadow
Industry Structure
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- Changes in industry structure
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- Figure 15: Analysis of changes in postal and courier activities, by number of businesses and outlets, 2015-19 (units)
- Structure by employment
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- Figure 16: Analysis of the employment structure of postal and courier activities, by number of outlets, 2018 and 2019 (unit)
- Structure by turnover
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- Figure 17: Analysis of the turnover structure of postal and courier activities, by number of companies, 2018 and 2019 (£000 and unit)
Company Profiles
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- DPD Group UK Ltd
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- Figure 18: Financial analysis of DPD Group UK Ltd, 2014-18 (£ million and %)
- Hermes Parcelnet Ltd
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- Figure 19: Financial analysis of Hermes Parcelnet Ltd, 2015-19 (£ million and %)
- TNT UK Ltd
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- Figure 20: Financial analysis of TNT UK Ltd, 2014-18 (£ million and %)
- UPS UK Ltd
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- Figure 21: Financial analysis of UPS UK Ltd, 2014-18 (£ million and %)
- Yodel Delivery Network
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- Figure 22: Financial analysis of Yodel Delivery Network, 2014-18 (£ million and %)
The Consumer – What You Need to Know
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- Impact of COVID-19
- Courier and Express Delivery Usage
- Online Shopping Drivers
- Return Service Usage
- Delivery Pass Uptake
Courier and Express Delivery Usage
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- Over-45s lead delivery usage but under-45s more likely to send a parcel
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- Figure 23: Courier and express delivery usage in the past six months, February 2020
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- Figure 24: Changes in courier and express delivery usage over the past year, by age group, February 2020 (% of respondents)
- Geographical circumstances may limit over-45s’ use of faster delivery
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- Figure 25: Delivery speed of most recent parcel, February 2020 (% of respondents)
- Delivery pass model offers retailer a collaborative way to improve the delivery experience
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- Figure 26: Most important considerations in choosing delivery method, February 2020 (% of respondents)
Online Shopping Drivers
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- What convenience means differs across generations
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- Figure 27: Most important factors behind ordering online, February 2020 (% of respondents)
Return Service Usage
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- Under-45s’ preference for returns will underlie future service expectations for retailers
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- Figure 28: Return service usage, February 2020 (% of respondents)
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- Figure 29: Method of return, February 2020 (% of respondents)
Delivery Pass Uptake
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- Amazon dominates pass subscriptions and has paved the way for model’s future
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- Figure 30: Delivery pass uptake by product category, February 2020 (% of respondents)
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- Figure 31: Delivery pass uptake by product, February 2020 (% of respondents)
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Methodology
Further Sources and Contacts
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- Trade associations
- Trade magazines
- Trade events
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