E-commerce drives parcel boom Down Under

Internet Retailing

10th Oct 2017

New research suggests the Australian parcel market will grow 9 to 12 per cent from 2017 to 2021 (CAGR), with more than a billion parcels a year expected to be shipped by 2021.

That’s according to Pitney Bowes’ second annual Parcel Shipping Index, which measures the volume and spend of B2B, B2C, C2B and C2C shipments in 13 major markets, including Australia.

This year’s index shows that Australia experienced 13 per cent growth in parcel volume year-on-year from 2015 to 2016, to 794 million.

Parcel spend in Australia grew in that period by four per cent to reach $9 billion in 2016.

But while parcel volume and spend is rising, startups are disrupting the market, increasing competition and driving down revenue per parcel.

This index shows yield per parcel dropped eight per cent year-on-year, as more non-traditional carriers entered the market.

“The Australian parcel landscape is in the midst of great growth and disruption,” said Stephen Darracott, country manager and director, Pitney Bowes ANZ.

“We anticipate even more parcel volume growth with the e-commerce revolution taking hold in Australia. Individuals will have more choice about delivery times and service options over the next year.

“Meanwhile, businesses should be undergoing a digital transformation of their mailing and shipping workflow to focus on more efficiency and inbound and outbound tracking capabilities.”

Other Asia Pacific countries are also seeing parcel volume growth. China grew parcel volume by 52 per cent in one year, increasing from 21 billion parcels in 2015 to 31 billion in 2016.

Indeed, China represents the largest market by volume, according to this year’s index. It is followed by the United States (at 13 billion parcels) and Japan (at 9 billion parcels).

“The continued rise of e-commerce globally is keeping the parcel shipping market strong through 2021 as consumers are increasingly looking to online shopping for convenience, price and availability of products from around the world,” said Lila Snyder, executive vice president and president, Global Ecommerce, Pitney Bowes.

“As consumer expectations continue to rise, shipping technology and service providers will need to help retailers and marketplaces meet those demands,” she said.