SERVICES
E-commerce spurs growth in competitive industry
• Local courier companies are focusing on increasing their efficiencies, writes Lynette Dicey
Tmoved to express delivery. As passenger flights have returned, so too has freight moved back to general cargo and away from express delivery.
One exception to this trend is on-demand grocery deliveries which, says Marshall, have continued to experience exponential growth.
Across the industry both globally and internationally, logistics providers are focusing on driving costs down to match revenues, says Marshall. Graeme Lazarus, MD of RAM, says the most significant industry trends impacting the courier services industry is the rise in e-commerce and quickcommerce (or on-demand delivery) which is heightening customer expectations.
That’s certainly the case in SA too, says Marshall. With the exception of the e-commerce sector, volumes are down and many businesses are in something of a holding pattern.
Data released earlier this month for the fourth quarter of 2022 by Stats SA revealed that GDP declined by 1.3%, a worse contraction than expected Marshall believes the year ahead will be a tough one for the courier industry. This is a very competitive industry which is highly service driven. The energy crisis coupled with sociopolitical issues and possible pending legislation means that both the industry and its customers will have to batten down the hatches and navigate their way through significant uncertainty.
volume says Marshall. Globally, many logistics businesses are struggling.
Although e-commerce saw significant growth during the Covid-19 pandemic, that growth has levelled out post the pandemic, says Marshall. During the pandemic, general air cargo was very difficult with the result that a lot of this sector
Craig Pitchers, chief operating officer of The Courier Guy, says the increased demand through e-commerce has resulted in some significant industry developments. The number of small and mediumsized businesses and retailers offering goods through apps and an online presence has increased hugely over the past two years.
He says one of the biggest trends affecting the industry is the continued increased demand in the e-commerce business-to-consumer delivery space. Coupled to this is a move to more on-demand offerings where a customer purchases something online and receives delivery within 60 minutes much like what is happening in the grocery space. We re also seeing significant demand in the customer-tocustomer space where the general public wants to send a parcel, he says.
The Courier Guy provides this service to the public through its 2,500 drivers, 22 depots, 170-strong Kiosk network and 1,100 pudo lockers. In a difficult operating environment, local courier companies are focusing on increasing their efficiencies. Pitchers says The
Counting the last mile costs
Firm committed to SA
Craig Pitchers streamlined.
INSIGHTS: COURIER SERVICES
Lockers add convenience
Global reach is critical
• Customers also expect one-stop solutions in digital world
Accelerated by the Covid-19 pandemic, increasing global connectivity and the consequent growth of digital marketplaces, global crossborder and domestic e-commerce has experienced significant growth in recent years. Online shopping increased 77% year on year in SA in the early part of the pandemic, accelerating the innovation and adoption of digital commerce by half a decade. Shopping, working and socialising online became commonplace. According to a report by eMarketer, global cross-border ecommerce sales reached $4.28-trillion in 2020, a 27% year-over-year growth The ability of the last mile couriers to adapt to this new normal has been critical to their success. The transformation is underpinned by a changing demographic with millennials
increasingly fulfilling decisionmaking roles and expecting mobility and choice on last mile deliveries. This calls for innovation and because supply and demand are no longer necessarily housed within the same country, global solutions and reach both globally and intra-country are critical in providing one-stop solutions to a demanding audience. By way of example, the complexities post-Brexit for UK-based e-commerce companies into the European market varies vastly from those in SA, the latter characterised by its own unique set of wellpublicised challenges. Yet,
Grocery delivery services ramp up
Checkers Sixty60 from
launch.
innovation and to
intellectual property of the Sixty60 sales channel, in late 2021 Shoprite entered into a joint venture with RTT Group. Both parties own 50% of the
INSIGHTS: COURIER SERVICES
Sustainability is a key focus
Growth of e-commerce around the world benefits logistics providers
Taking an agile approach
DHL Group aims to use 30% sustainable aviation fuel by 2030.