South America Courier, Express, And Parcel (CEP) Market Size and Share
Market Overview
| Study Period | 2017 - 2030 |
|---|---|
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2030 |
| Market Size (2025) | USD 8.24 Billion |
| Market Size (2030) | USD 10.92 Billion |
| Growth Rate (2025 - 2030) | 5.79% CAGR |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
|
South America Courier, Express, And Parcel (CEP) Market Analysis by Mordor Intelligence
The South America courier, express, and parcel market size stands at USD 8.24 billion in 2025 and is projected to reach USD 10.92 billion by 2030, reflecting a 5.79% CAGR between 2025-2030. This trajectory underscores how infrastructure megaprojects, digitized customs regimes, and rising e-commerce participation are reshaping the region’s logistics landscape. Brazil’s Programa Remessa Conforme (PRC) removed the USD 50 de minimis ceiling in 2024, channeling international parcels toward accredited platforms and compressing clearance times. Regional development banks have earmarked USD 10 billion for five north-south and east-west integration routes; early modeling indicates that Pacific-bound cargo from Brazil could arrive in Asia 10 days sooner than by existing maritime loops. Down-the-line benefits include higher round-trip asset utilization, denser cross-border parcel flows, and greater leverage for operators with customs-compliance scale.
Key Report Takeaways
- By destination, domestic parcels secured 64.63% of the South America courier, express, and parcel (CEP) market share in 2024, while international shipments are growing at a 6.00% CAGR between 2025-2030.
- By speed of delivery, non-express services accounted for 76.06% of the South America courier, express, and parcel (CEP) market size in 2024; the express segment is projected to expand at a 6.68% CAGR between 2025-2030.
- By model, business-to-consumer (B2C) consignments held a 59.18% share in 2024, whereas consumer-to-consumer (C2C) traffic is expected to register a 2.91% CAGR over 2025-2030.
- By shipment weight, light-weight parcels represented 63.76% share in 2024, while heavy-weight parcels are advancing at a 4.91% CAGR between 2025-2030.
- By mode of transport, road carried 56.03% of the value in 2024; air transport is forecast to grow at a 4.86% CAGR between 2025-2030.
- By end user industry, manufacturing led with 38.99% share in 2024, yet e-commerce is rising at a 6.33% CAGR between 2025-2030.
- By country, Brazil dominated with a 70.57% share in 2024, while Chile exhibits the fastest growth at a 6.27% CAGR between 2025-2030.
South America Courier, Express, And Parcel (CEP) Market Trends and Insights
Drivers Impact Analysis
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| E-commerce boom and rising internet penetration | +1.8% | Brazil core, spillover to Argentina and Chile | Medium term (2-4 years) |
| Infrastructure megaprojects in Brazil and Chile ports/highways | +1.2% | Brazil-Chile corridor, Paraguay transit routes | Long term (≥ 4 years) |
| Rapid shift to same-day/next-day delivery expectations | +0.9% | Urban centers in Brazil, Argentina, Chile | Short term (≤ 2 years) |
| Government-mandated digital track-and-trace systems | +0.7% | Brazil national, Argentina pilot regions | Medium term (2-4 years) |
| China-Brazil dedicated freighter corridors shorten lead-times | +0.5% | Brazil-Asia routes, Pacific port connections | Long term (≥ 4 years) |
| Dark-store ultrafast-grocery networks raise parcel density | +0.4% | Metropolitan areas Brazil, Chile urban centers | Short term (≤ 2 years) |
| Source: Mordor Intelligence | |||
E-commerce Boom and Rising Internet Use
Roughly 100 million South Americans transacted online in 2024 as mobile broadband prices fell and digital-payment rails scaled. Brazilian marketplaces pushed beyond tier-one cities, adding 1,500 municipalities with populations between 20,000 and 300,000 to their delivery footprint. Higher rural connectivity funnels incremental order volumes into networks originally designed for dense metro hubs, prompting operators to recalibrate node placement and inventory buffering. PRC accreditation lets certified platforms pre-file 100% of shipment data, shrinking border dwell from a historical five-day average to under 24 hours[1]Morini et al., “A Paradigm Shift in Cross-Border E-Commerce Regulatory Compliance,” WORLDCUSTOMSJOURNAL.ORG. Parallel digitization initiatives in Chilean and Argentine customs signal broader adoption of data-driven clearances that favor scale players with API-ready systems. The resulting surge in order frequency and geographic spread underpins sustained parcel-volume lift over the medium term.
Infrastructure Megaprojects in Ports/Highways
Five integration corridors championed by Brazil’s Ministry of Planning will connect Atlantic factories to Pacific docks via Paraguay and northern Chile, with USD 10 billion of public-bank financing secured for initial segments[2]Ministry of Planning and Budget, “Brazil Strengthens South American Integration with New Investment Agreement for Strategic Routes,” SECOM.GOV.BR. The 224-km Bioceanic Road Corridor already shows 70% completion and includes 41 wildlife crossings to meet environmental pledges. Simulations indicate the Chancay-Santos maritime leg could cut Shanghai transit by 10 days, enough to reposition South America as a viable near-Pacific staging point for time-sensitive goods. Operators able to blend road, rail, and feeder-vessel options gain routes that bypass chronically congested Atlantic ports. Chile’s proposed COPIAPORT-E deep-water facility aims for 55% per-ton cost savings, although final government approvals remain pending. These projects collectively lift throughput capacity and unlock multimodal parcel routing strategies across the long term.
Shift to Same-Day/Next-Day Expectations
Latin America’s two largest integrators report that 60% of consumer deliveries within São Paulo and Santiago now arrive within 48 hours, up from 42% YoY. Quick-commerce grocers in Brazil complete 20-minute hand-offs by stocking micro-fulfillment dark stores within 3-km radii, raising parcel density for adjacent courier routes. Rising benchmarks compel traditional carriers to augment sortation speeds, employ AI-powered dispatching, and add electric two-wheel fleets that can navigate urban congestion. Operators meeting premium-speed demand capture uplift in revenue per parcel that offsets last-mile cost inflation. Conversely, networks lacking same-day capability risk commoditization into low-yield deferred-delivery segments.
Digital Track-and-Trace Mandates
Under PRC, Brazil now requires express consignments to submit full data sets no later than two hours before vehicle arrival; compliant parcels flow through green-lane channels with inspection rates below 5%[3]Receita Federal do Brasil, “Novas Regras,” GOV.BR. Correios has deployed blockchain-anchored smart contracts to guarantee event immutability and trigger automated tax settlement. Argentina’s 2024 road-transport decree similarly obliges carriers to transmit GPS positions and electronic invoices in real time. Operators that already embed shipment-level data capture enjoy faster release times and reduced fines, while smaller firms face tech-investment hurdles that could squeeze market participation over the medium term.
Restraints Impact Analysis
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Macroeconomic volatility and FX shocks (e.g., Argentina) | -1.1% | Argentina primary, spillover to regional cross-border flows | Short term (≤ 2 years) |
| Road congestion and poor secondary-city infrastructure | -0.8% | Urban centers Brazil, Argentina interior routes | Medium term (2-4 years) |
| Rising parcel-theft insurance premiums | -0.4% | Brazil metropolitan areas, Argentina urban corridors | Short term (≤ 2 years) |
| Battery-cell scarcity slowing electrification of last-mile fleets | -0.3% | Regional fleet operators, urban delivery networks | Medium term (2-4 years) |
| Source: Mordor Intelligence | |||
Macroeconomic Volatility and FX Shocks
Argentina’s peso lost more than 45% against the U.S. dollar between January 2024 and May 2025, forcing couriers to reprice line-haul contracts every quarter. Multi-currency receivables lengthen cash-conversion cycles and raise working-capital needs, especially for firms that settle customs duties in USD but bill domestic customers in local currency. MERCOSUR’s SML platform processes barely 5% of Brazil’s exports, limiting regional recourse to local-currency netting[4]Economic Commission for Latin America and the Caribbean, “MERCOSUR Countries Strengthen Trade Ties Despite Global Challenges,” CEPAL.ORG. Until exchange-rate stability returns, parcel operators hedge via forward contracts, yet premiums erode profit margins and complicate tariff transparency for cross-border shoppers.
Road Congestion and Weak Secondary-City Networks
Freight traffic into metropolitan São Paulo averages speeds below 15 km/h during afternoon peaks, inflating fuel and labor inputs. Secondary roads linking Brazil’s interior municipalities still carry more than 60% of e-commerce parcels but often lack paved shoulders and safe night-lighting, raising vehicle damage risk and delivery variability. Argentina’s highway concession backlog delays critical resurfacing projects past 2026, prolonging bottlenecks on high-growth e-commerce corridors. Resulting cost penalties push couriers toward micro-fulfillment and local drop-point partnerships, yet rollout pace is constrained by capital discipline and real-estate scarcity.
Segment Analysis
By End User Industry: E-Commerce Surges, Manufacturing Holds Ground
Manufacturing kept the lion’s share at 38.99% in 2024, owing to robust automotive and machinery exports, yet e-commerce parcels are expanding at a 6.33% CAGR between 2025-2030 as omnichannel brands scale direct-to-consumer fulfillment. Brazil’s revised import-tax matrix for small consignments below USD 50 now applies a simplified dual-rate system—17% state VAT plus 60% federal duty—yet accredited platforms claim expedited 24-hour release, cushioning cost effects for shoppers. Healthcare and financial services flows introduce higher compliance burdens, pressing carriers to certify GDP-cold-chain or secure-document capabilities.
Primary-industry and wholesale segments remain cyclical, tied to commodity pricing; nevertheless, ongoing infrastructure projects lower inland drayage premiums, tempting exporters to shift to parcelized spares and high-value components. End-user diversity spreads demand risk and compels carriers to specialize in vertical-specific service layers without surrendering volume agility.
Note: Segment shares of all individual segments available upon report purchase
By Destination: International Momentum Surpasses Domestic Maturity
International shipments record a 6.00% CAGR between 2025-2030, even though domestic parcels dominated 64.63% of the South America courier, express, and parcel market in 2024. PRC accreditation slashes clearance time for certified imports, tilting consumer choice toward cross-border marketplaces. Emerging rail links from Brazil to Peru open a land-sea shortcut to Asia that chips away at historical freight-rate disadvantages. Meanwhile, domestic volumes plateau in tier-one cities, prompting carriers to pursue rural penetration strategies that lengthen average delivery distances and intensify cost-per-stop pressures. Over the forecast period, the destination mix will hinge on the pace of customs-systems harmonization across MERCOSUR and the speed at which integration corridors eliminate hinterland isolation.
Domestic-heavy networks benefit from existing last-mile density, but international growth prospects incentivize operators to invest in bonded warehouses, multi-currency billing engines, and Level 3 security protocols. The dual focus demands nimble asset allocation, with cross-docking hubs positioned near dry ports to balance domestic and inbound flows seamlessly.
By Speed of Delivery: Express Services Capture Premium Growth
Express deliveries, though just 23.94% of 2024 values, are set to accelerate at a 6.68% CAGR between 2025-2030, outpacing non-express consignments that still command scale advantages in rural coverage. The South America courier, express, and tech-savvy urban consumers buoy the parcel market size for express parcels, prepared to pay 20-30% surcharges for guaranteed next-day arrival. Airlines such as FedEx now run nine extra weekly rotations between Miami and Bogotá-São Paulo lanes, expanding air-cargo lift by 15% year on year. Legacy networks respond by installing automated sorters, achieving 30,000 parcels per hour, cutting cycle time, and closing the competitive gap.
Non-express services continue to anchor baseline throughput, particularly for low-ticket commodities and subscription replenishments where cost trumps speed. Hybrid offerings—economy deliveries upgraded at the customer’s discretion—blur once-clear distinctions and allow carriers to flex capacity. The segmentation illustrates how value migrates toward service-level optionality rather than binary product categories.
By Shipment Weight: Light Parcels Drive Frequency, Heavy Parcels Lift Yield
Light-weight parcels secured 63.76% of the 2024 value as merchants pursue cost-per-order optimization through split shipments. Automated sorter installations across São Paulo’s three largest e-fulfillment hubs raise hourly throughput 22%, reinforcing the economic rationale for small-item dispersion. Heavy-weight parcels grow at a 4.91% CAGR between 2025-2030 on the back of industrial spares and cross-border wholesale demand. Integration-corridor upgrades promise to lower line-haul costs for heavy items by as much as 12%, bolstering competitiveness against ocean freight for time-sensitive goods.
Medium-weight consignments pose mix-management challenges: too heavy for belt sorters yet too light for pallet lanes. Carriers experiment with modular cage systems that shift between rollerbed trucks and aircraft lower decks, smoothing transfers and limiting manual handling. Effective segmentation enables profit extraction from both frequency-driven light-parcel surges and yield-rich oversized items, enhancing overall network resilience.
Note: Segment shares of all individual segments available upon report purchase
By Mode of Transport: Air Gains Share While Road Remains Backbone
Road retained 56.03% of the 2024 value, anchored by flexible pickup-to-delivery control and ubiquitous terminal access. The South America courier, express, and parcel market share for air transport inches upward on a 4.86% CAGR between 2025-2030 as express demand and cold-chain pharma shipments expand. DHL’s 2025-2030 plan earmarks EUR 1 billion (USD 1.10 billion) for new GDP-certified pharma hubs in Latin America, half of which incorporate dedicated freighter capacity. Rail and multimodal pipelines emerge as credible alternatives once the China-Brazil transcontinental railway closes its remaining gaps after 2028, delivering cost reductions estimated at 18% versus trucking on certain lanes.
Operators hedge modal risk by stitching capacity agreements across carriers, enabling shipment-level mode switching driven by inventory urgency and tariff windows. Such flexibility unlocks route-level arbitrage and buoys service reliability in the face of climatic or political disruptions.
By Model: C2C Emergence Amid B2C Supremacy
B2C shipments represented 59.18% of the 2024 value, sustained by large-platform retail dynamics. Consumer-to-consumer parcels, however, notch a 2.91% CAGR between 2025-2030 as social-commerce storefronts multiply on mobile apps that integrate in-checkout shipping labels. Brazilian digital-wallet adoption reached 68% of adult users in 2024, removing friction for peer-to-peer transactions. Operators accommodate C2C flows by launching smartphone booking portals and dynamic pricing that compensates for highly fragmented pickup points.
B2B movements remain essential for manufacturing supply chains requiring formal documentation and scheduled delivery windows. Yet even here, servitization and vendor-managed inventory have shortened consignment sizes, nudging networks closer to parcelized models. The model mix compels carriers to sustain operational versatility, juggling dock-level pallet intake at sunrise and door-to-door household hand-offs by dusk.
Geography Analysis
Brazil’s 70.57% market share in 2024 reflects population gravity, extensive pickup-drop coverage, and early customs digitization wins. Correios’ 2025 blockchain retrofit and 3,099 postman hiring plan signal a public-sector pivot toward performance parity with private integrators. Chile, while smaller, delivers a 6.27% CAGR (2025-2030) on the back of Pacific-port upgrades and stable macro policy that attracts fulfillment-center investment. Pacific-facing deep-water projects such as Chancay and potential COPIAPORT-E cut voyage time to Asia by up to 15 days, entrenching Chile as a viable transshipped-parcel hub.
Argentina’s currency turbulence dampens import volumes yet pushes exporters toward intra-MERCOSUR lanes where local-currency settlement partially buffers FX risk. Paraguay and Uruguay, classified under Rest of South America, gain traffic spillover once integration highways reach steady-state operations in 2028, amplifying regional redundancy and routing optionality.
Brazil’s vast urban footprint and PRC-enabled import regime continue to anchor regional flows, but high-growth potential now gravitates toward Chile’s Pacific gateway projects and Paraguay’s corridor build-outs. Santiago’s stable inflation and cloud-infrastructure expansion foster digital-commerce volumes that ripple across borderless Andean routes. Argentina remains the wildcard; successful macro stabilization could release pent-up consumer demand and trigger a parcel-volume rebound. Operators committed to a tri-country network—Brazilian origination, Chilean transshipment, Argentine distribution—stand to extract multimodal synergies as new rail and road corridors mature.
Competitive Landscape
Market concentration is moderately consolidated: the top five operators control a significant share of region-wide parcel revenue, yet regulatory upheaval and infrastructure builds preserve ample room for insurgent specialists. April 2025 saw DSV finalize its USD 15.8 billion acquisition of DB Schenker, vaulting the merged entity into the region’s top quartile for capacity and customs-brokerage licenses.
UPS expanded Latin America air routes in February 2025, while FedEx layered additional Miami rotations in late 2024, broadening express service grids. Public-sector reform at Correios introduces blockchainized visibility that may set a domestic benchmark rivals must match.
White-space opportunity clusters around secondary-city penetration, cross-border payment orchestration, and rail-linked hub positioning—niches where nimble regional firms can harvest growth before consolidation intensifies.
South America Courier, Express, And Parcel (CEP) Industry Leaders
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Empresa Brasileira de Correios e Telegrafos
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DHL Group
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FedEx
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United Parcel Service (UPS)
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Correo Argentino
- *Disclaimer: Major Players sorted in no particular order
Recent Industry Developments
- May 2025: Correios Brazil unveiled a restructuring plan featuring blockchain parcel tracking, smart-contract invoicing, and 3,099 new last-mile positions.
- April 2025: DHL Group announced a EUR 2 billion (USD 2.20 billion) global health-logistics expansion, allocating 50% to the Americas for cold-chain and Pharma Hub upgrades.
- April 2025: DSV completed its USD 15.8 billion acquisition of DB Schenker, creating one of the world’s largest logistics groups with expanded South American reach.
- November 2024: FedEx deployed additional Central and South America flights that connect key markets with Miami, raising regional next-day capacity.
South America Courier, Express, And Parcel (CEP) Market Report Scope
Domestic, International are covered as segments by Destination. Express, Non-Express are covered as segments by Speed Of Delivery. Business-to-Business (B2B), Business-to-Consumer (B2C), Consumer-to-Consumer (C2C) are covered as segments by Model. Heavy Weight Shipments, Light Weight Shipments, Medium Weight Shipments are covered as segments by Shipment Weight. Air, Road, Others are covered as segments by Mode Of Transport. E-Commerce, Financial Services (BFSI), Healthcare, Manufacturing, Primary Industry, Wholesale and Retail Trade (Offline), Others are covered as segments by End User Industry. Argentina, Brazil, Chile are covered as segments by Country.| Domestic |
| International |
| Express |
| Non-Express |
| Business-to-Business (B2B) |
| Business-to-Consumer (B2C) |
| Consumer-to-Consumer (C2C) |
| Heavy Weight Shipments |
| Light Weight Shipments |
| Medium Weight Shipments |
| Air |
| Road |
| Others |
| E-Commerce |
| Financial Services (BFSI) |
| Healthcare |
| Manufacturing |
| Primary Industry |
| Wholesale and Retail Trade (Offline) |
| Others |
| Argentina |
| Brazil |
| Chile |
| Rest of South America |
| Destination | Domestic |
| International | |
| Speed of Delivery | Express |
| Non-Express | |
| Model | Business-to-Business (B2B) |
| Business-to-Consumer (B2C) | |
| Consumer-to-Consumer (C2C) | |
| Shipment Weight | Heavy Weight Shipments |
| Light Weight Shipments | |
| Medium Weight Shipments | |
| Mode of Transport | Air |
| Road | |
| Others | |
| End User Industry | E-Commerce |
| Financial Services (BFSI) | |
| Healthcare | |
| Manufacturing | |
| Primary Industry | |
| Wholesale and Retail Trade (Offline) | |
| Others | |
| Country | Argentina |
| Brazil | |
| Chile | |
| Rest of South America |
Market Definition
- Courier, Express, and Parcel - The Courier, Express, and Parcel services, often called as CEP Market, refers to the logistics and postal service providers which specialize in moving small goods (parcels/packages). It captures the overall market size (USD) and market volume (number of parcels) of (1) the shipments/parcels/packages which are under 70kgs/ 154lbs weight, (2) Business Customer packages viz. Business-to-Business (B2B) & Business-to-Consumer (B2C) as well as private customer packages (C2C), (3) non-express parcel delivery services (Standard and Deferred) as well as express parcel delivery services (Day-Definite-Express and Time-Definite-Express), (4) domestic as well as international shipments.
- Demographics - To analyse total addressable market demand, population growth & forecasts have been studied and presented in this industry trend. It represents population distribution across categories like gender (male/female), development area (urban/rural), major cities among other key parameters like population density and final consumption expenditure (growth and share % of GDP). This data has been used for assessing the fluctations in demand & consumption expenditure, and the major hotspots (cities) of potential demand.
- Domestic Courier Market - Domestic Courier Market refers to the CEP shipments wherein the origin and destination is within the boundary of the geography studied (country or region as per the scope of report). It captures the market size (USD) and market volume (number of parcels) of (1) the shipments/parcels/packages which are under 70kgs/ 154lbs weight, including light weight shipments, medium weight shipments and heavy weight shipments (2) Business Customer packages viz. Business-to-Business (B2B) & Business-to-Consumer (B2C) as well as private customer packages (C2C), (3) non-express parcel delivery services (Standard and Deferred) as well as express parcel delivery services (Day-Definite-Express and Time-Definite-Express).
- E-Commerce - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the e-tailers, through online sales channel, on Courier, Express, and Parcel (CEP) services. The scope includes (i) the supply chain of a company's online customer orders being fulfilled, (ii) the process of getting a product from the point of manufacturing to the point at which it is delivered to consumers. It involves managing inventory (deferred as well as time critical), shipping, and distribution.
- Export Trends and Import Trends - Overall logistics performance of an economy is positively and significantly (statistically) correlated to its trade performance (exports and imports). Hence, in this industry trend, total value of trade, major commodities/ commodity groups and the major trade partners, for the studied geography (country or region as per the scope of report) have been analysed alongside the impact of major trade/logistics infrastructure investments & regulatory environment.
- Financial Services (BFSI) - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the BFSI players, on Courier, Express, and Parcel (CEP) services. CEP is important to the financial services industry in shipping of confidential documents and files. The establishments in this sector are engaged in (i) financial transactions (that is, transactions involving the creation, liquidation, or change in ownership of financial assets) or in facilitating financial transactions, (ii) financial intermediation, (iii) the pooling of risk by underwriting annuities and insurance, (iv) providing specialized services that facilitate or support financial intermediation, insurance and employee benefit programs, and (v) monetary control - the monetary authorities.
- Fuel Price - Fuel price spikes can cause delays and diruption for logistics service providers (LSPs), while drops in the same can result in higher short-term profitability and increased market rivalry to offer consumers with the best deals. Hence, the fuel price variations have been studied over the review period and presented along with the causes as well as market impacts.
- GDP Distribution by Economic Activity - Nominal Gross Domestic Product and distribution of the same, across major economic sectors in the geography studied (country or region as per scope of the report) have been studied and presented in this industry trend. As GDP is positively related to the profitability and growth of logistics industry, this data has been used in adjunction to the input-output tables/ supply-use tables for analyzing the potential major contributing sectors towards the logistics demand.
- GDP Growth by Economic Activity - Growth of Nominal Gross Domestic Product across major economic sectors, for the geography studied (country or region as per scope of the report) have been presented in this industry trend. This data has been utilized for assessing the growth of logistics demand from all the market end users (economic sectors considered here).
- Healthcare - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the Healthcare players (Hospitals, clinics, mrdical centres) , on Courier, Express, and Parcel (CEP) services. The scope includes CEP services involved in the defrerred as well time critical movement of medical goods & supplies (surgical supplies and instruments, including gloves, masks, syringes, equipment). The establishments in this sector (i) include the ones providing medical care exclusively (ii) deliver services by trained professionals (iii) involve processes, including labor inputs of health practitioners with the requisite expertise (iv) are defined based on the educational degree held by the practitioners included in the industry.
- Inflation - Variations in both Wholesale Price Inflation (YoY change in producer price index) and Consumer Price Inflation have been presented in this industry trend. This data has been used to assess the inflationary environment as it plays a vital role in smooth functioning of the supply chain, directly impacting the logistics operational cost components e.g., pricing of tyres, driver wages & benefits, energy/fuel prices, maintenace costs, toll charges, warehousing rents, custom brokerage, forwarding rates, courier rates etc. hence impacting the overall freight and logistics market.
- Infrastructure - As infrastructure plays a vital role in an economy's logistics performance, variables like length of roads, distribution of road length by surface category (paved v/s unpaved), distribution of road length by road classification (expressways v/s highways v/s other roads), rail length, volume of containers handled by major ports and tonnage handled by major airports have been analysed and presented in this industry trend.
- International Express Service Market - International Express Service Market refers to the CEP shipments wherein the origin or destination is not within the boundary of the geography studied (country or region as per the scope of report). It captures the market size (USD) and market volume (number of parcels) of (1) the shipments/parcels/packages which are under 70kgs/ 154lbs weight, including light weight shipments, medium weight shipments and heavy weight shipments (ii) Inter-Region as well as Intra-Region Shipments
- Key Industry Trends - The report section named "Key Industry Trends" include all the key variables/parameters studied to better analyze the market size estimates and forecasts. All the trends have been presented in the form of data points (time series or latest available data points) along with analysis of the paramter in the form of concise market relevant commentary, for the geography studied (country or region as per the scope of report).
- Key Strategic Moves - The action taken by a company to differentiate from its competitor or used as a general strategy is referred to as a key strategic move (KSM). This includes (1) Agreements (2) Expansions (3) Financial Restructuring (4) Mergers and Acquisitions (5) Partnerships, and (6) Product Innovations. Key players (Logistics Service Providers, LSPs) in the market have been shortlisted, their KSM have been studied and presented in this section.
- Logistics Performance - Logistics Performance and Logistics Costs are the backbone of trade, and influences trade costs, making countries compete globally. Logistics performance is influenced by market wide adopted supply chain management strategies, government services, investments & policies, fuel/ energy costs, inflationary environment etc. Hence, in this industry trend, the logistics performance of the geography studied (country/ region as per the scope of report) has been analysed and presented over the review period.
- Manufacturing - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the Manufacturing industry (including Hi-Tech/Technology) players, on Courier, Express, and Parcel (CEP) services. The end user players considered are the establishments primarily engaged in the chemical, mechanical or physical transformation of materials or substances into new products. Logistics Service Providers (LSPs) play a crucial role in maintaining a smooth flow of raw materials across the supply chain, enabling timely delivery of finished goods to distributors or end customers and storing & supplying the raw materials to clients for just-in-time manufacturing.
- Other End Users - Other end user segment captures the external (outsourced) logistics expenditure incurred by the construction, real estate, educational services, and professional services (administrative, waste management, legal, architectural, engineering, design, consulting, scientific R&D), on Courier, Express, and Parcel (CEP) services. Logistics Service Providers (LSPs) plays a crucial role in the reliable movement of time critical supplies and documents to/from these industries such as transporting any equipment or resources required, shipping confidential documents and files.
- Primary Industry - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the AFF (Agriculture, Fishing, and Forestry) and Extraction indsutry (Oil &Gas, Quarrying and Mining) players, on Courier, Express, and Parcel (CEP) services. The end user players considered are the establishments (i) primarily engaged in growing crops, raising animals, harvesting timber, harvesting fish & other animals from their natural habitats and providing related support activities; (ii) that extract naturally occurring mineral solids, such as coal and ores; liquid minerals, such as crude petroleum; and gases, such as natural gas. Herein, Logistics Service Providers (LSPs) (i) play a crucial role in acquisition, storage, handling, transportation, and distribution activities for the optimal & continuous flow of inputs (seeds, pesticides, fertilizers, equipment, and water) from manufacturers or suppliers to the producers and smooth flow of output (produce, agro-goods) to distributors/ consumers; (ii) cover entire phases from upstream to downstream and play a crucial role in the transportation of machinery, drilling equipments, extracted minerals, crude oil & natural gas and refined/ processed products from one place to another. This includes both termperature controlled and non-temperature controlled logistics, as and when required according to the shelf life of goods being transported or stored.
- Producer Price Inflation - It indicates inflation from viewpoint of the producers viz. the average selling price received for their output over a period of time. Annual change (YoY) of producer price index is reported as wholesale price inflation in the "Inflation" industry trend. As WPI captures dynamic price movements in most comprehensive way, it is widely used by governments, banks, industry, business circles and is deemed important in formulation of trade, fiscal and other economic policies. The data has been used in adjunction to consumer price inflation for better understanding the inflationary environment.
- Segmental Revenue - Segmental Revenue has been triangulated or computed and presented for all the major players in the market. It refers to the courier, express, and parcel (CEP) market specific revenue earned by the company, over the base year of study, in the geography studied (country or region as per the scope of report). It is computed through the study and analysis of major parameters like financials, service portfolio, employee strength, fleet size, investments, number of countries present in, major economies of concern, etc. that have been reported by the company in its annual reports, webpage. For companies having scarce financial disclosures, paid databases like D&B Hoovers, Dow Jones Factiva have been resorted to and verified through industry/expert interactions.
- Transport and Storage Sector GDP - Value and growth of Transport and Storage Sector GDP has a direct relation to the freight and logistics market size. Hence, this variable has been studied and presented over the review period, in value terms (USD) and as share % of total GDP, in this industry trend. The data has been supported by concise and relevant commentary around the investments, developments, and current market scenario.
- Trends in E-Commerce Industry - Enhanced internet connectivity and boom in smartphone penetration, coupled with increasing disposable incomes, has led to a phenomenal growth in the e-commerce market globally. Online shoppers require fast and efficient delivery of their orders leading to an increase in the demand for logistics services especially e-commerce fulfilment services. Hence, the Gross Merchandise Value (GMV), historial and projected growth, breakup of major commodity groups in e-commerce industry for the studied geography (country or region as per scope of the report) have been analysed and presented in this industry trend.
- Trends in Manufacturing Industry - Manufacturing industry involves the transformation of raw materials into finished products, while logistics industry ensures the efficient flow of raw materials to the factory, and the transport of manufactured products to the distributors & consumers. Demand-Supply of both industries are highly cross-linked and critical for a seamless supply chain. Hence, the Gross Value Added (GVA), breakup of GVA into major manufacturing sectors, and growth of manufacturing industry over the review period have been analysed and presented, in this industry trend.
- Wholesale and Retail Trade (Offline) - This end user industry segment captures the external (outsourced) logistics expenditure incurred by the wholesalers and retailers, through offline sales channel, on Courier, Express, and Parcel (CEP) services. The end user players considered are the establishments primarily engaged in wholesaling or retailing merchandise, generally without transformation, and rendering services incidental to the sale of merchandise. Logistics Service Providers (LSPs) plays a crucial role in the reliable movement of supplies to and finished products from production houses to the distributors and finally to the end customer covering activites like material sourcing, transportation, order fulfillment, warehousing & storage, demand forecasting, inventory management etc.
| Keyword | Definition |
|---|---|
| Axle Load | The axle load refers to the total load (weight) bearing on the roadway through wheels connected to a given axle. Across the globe, there are systems in place to ensure axle load monitoring, wherein surpassing the defined limits set by the concerned regulatory authority can lead to penalty/fine. For transportation of goods via road this can be an important determinant of costs as knowledge about the axle load limits can be used to (i) load the vehicle optimally for maximizing profits (ii) avoid exceeding the same and hence the probable fines associated (iii) avoid wear and tear of the vehicle (iv) avoid damage to pavement resulting in noticeable public maintenance and repair costs (v) achieve better turnaround time. |
| Back Haul | Backhaul is the return movement of a transport vehicle from its original destination to its original point of departure, and can include full, partial, or empty truck loads (all or part of the way) depending on the visibility of the local freight ecosystem. In this regard, transportation of empty containers to the point of origin, known as deadheading is also a significant factor, considering the supply/container shortages across the geographies, resulting in cost escalation and under optimized profit potential attainment. Generally, the carriers offer discounts on the backhaul, to secure freight for the trip. |
| Bill of Lading (BOL) | A bill of lading is a legal contract document issued by a carrier to a shipper to acknowledge reception of their cargo, and is evidence for the contract of carriage between the two parties. Broadly it details the (i) type, quantity, and other specifications of the goods being carried (ii) destination, and terms & conditions of the shipment (iii) carrier and drivers with all the necessary information to process the shipment, which can be used for insurance and customs clearance purposes (iv) assurance that the consignment is damage-free and ready to be shipped to the consignee. In this regard, a house bill of lading (HBL) is a document issued by a freight forwarder or a non-vessel operating common carrier (NVOCC) to acknowledge receipt of items for shipment (to a shipper). If shipments from several shippers are involved a master bill of lading (MBL) might be involved which is a consolidated version of the same for all the shipments being taken care of by the carrier (to a common destination) and might be issued by the carrier to the freight forwarder or the shipper (depending on who books the transport). |
| Bunkering | Bunkering is the process of supplying fuel to power the propulsion system of a ship. It includes the logistics of loading and distributing the fuel among available shipboard tanks. In this regard, (i) Bunker fuel is technically any type of fuel oil used aboard ships. It gets its name from the containers on ships and in ports that it is stored in; in the days of steam they were coal bunkers but now they are bunker-fuel tanks, (ii) Bunker refers to the spaces (Tank) on board a vessel to store fuel, (iii) Bunker trader refers to a person dealing in trade of bunker (fuel), (iv) Bunker call is made when a cargo ship anchors or berths in a port to take on bunker oil or supplies, (v) Bunkering service is the supply of a requested quality and quantity of bunkers to a ship. Bunkering is signficant from point of view of freight rates applicable to the shipper as Bunker Contribution (BUC)/ Fuel Adjustment Factor (FAF)/ Bunker Adjustment Factor (BAF) are applied by shipping lines to offset the effect of fluctuations in the cost of bunkers. |
| Cabotage | Transport by a vehicle registered in a country, performed on the national territory of another country. Cabotage law may restrict domestic cargo traffic to be carried in its own nationally registered, and sometimes built and crewed vehicles, though regulations vary across industries/commodity groups/countries and sometimes specify maximum allowable percentage of cabotage that can be serviced by foreign registered fleet. |
| C-commerce | Collaborative commerce (also known as C-commerce), (i) describes electronically enabled business interactions among an enterprise’s internal personnel, business partners and customers throughout a trading community (industry, industry segment, supply chain or supply chain segment); (ii) is the optimization of supply and distribution channels to capitalize on the global economy by using new technology efficiently. Advantages of C-commerce, to detail few include (i) maximization of organization's efficiency and profitability (ii) technology integration with physical channels to allow companies to work together (iii) increased information exchange such as inventory and product specifications, using the web as an intermediary (iv) increased competitiveness by reaching a broader audience. Examples of C-commerce, also known as peer-to-peer commerce, include (i) companies that allow consumers to rent things from each other, or marketplaces, such as Meta (formerly Facebook) Marketplace, that allow the sale of used goods; (ii) DoorDash teamed up with many national brands, such as McDonald’s and Chipotle, to offer fast food delivery, building their business model on c-commerce. They have since expanded their delivery service from restaurants to retailers and even offer 'fleets' of drivers to businesses. |
| Courier | A business/company that delivers packages/parcels/shipments (upto 70 kgs) including quick door to door pickup and delivery service for goods or documents, domestically or internationally, on a commercial contract basis. Example, DHL Group, FedEx, United Parcel Service of America, Inc., USPS, International Distributions Services, J&T Express, SF Express among several others |
| Cross docking | Cross docking is a practice in logistics management that includes unloading incoming delivery vehicles and loading the materials directly into outbound delivery vehicles, omitting traditional warehouse logistical practices and saving time and money. It requires close synchronization of both inbound and outbound movements. It is highly significant in reduction of costs pertaining to warehousing & storage (and the associated Value Added Services). |
| Cross Trade | International transport between two different countries performed by a vehicle registered in a third country. A third country is a country other than the country of loading/embarkation and the country of unloading/disembarkation. Cross Trade law may restrict international cargo traffic to be carried by respective country's registered vehicles, and sometimes built and crewed vehicles, though regulations vary across industries/commodity groups/countries and sometimes specify maximum allowable percentage of cross trade that can be serviced by foreign registered fleet. |
| Customs Clearance | The process of declaring and clearing cargoes through customs. It includes the procedures involved in getting cargo released by Customs through designated formalities such as presenting import license/permit, payment of import duties and other required documentations by the nature of the cargo. In this regard, a customs broker is a person or company licensed by the respective department of the country to act on behalf of freight importers and exporters. |
| Dangerous Goods | Dangerous goods (or hazardous materials or HAZMAT) include flammable liquids/solids, gases (compressed, liquified, dissolved under pressure), corrosives, oxidising substances, explosive substances and articles, substances which on contact with water emit flammable gasses, organic peroxides, toxic substances, infectious substances, radioactive materials, miscellaneous dangerous goods and articles. |
| First mile Delivery | First mile delivery refers to the (i) first stage of the freight/shipment/cargo/courier transportation (ii) the transportation of goods from a merchant’s premises or warehouse to the next fulfillment centre/warehouse/hub from where the goods are forwarded (iii) shipping goods from local distribution centers to stores (For retailers) (iv) transportation of finished goods from a plant or a factory to a distribution center (For manufacturers), (v) pick up of goods from the end-customer’s home or store followed by movement to a warehouse or storage location (movers and packers), (vi) process where goods are picked up from a retailer and then transferred to third-party logistics providers or courier service providers to be delivered to the end-consumer (e-commerce). Once the package reaches the next warehouse or the courier’s hub, it is then sorted and transported further until it reaches the customer’s doorstep. Example, if one chooses UPS as a courier, first-mile delivery will be the product being delivered from manufacturer's/retailer's warehouse to the UPS’s warehouse/ fulfilment centre. |
| Last Mile Delivery | Last mile delivery refers to the very last step of the delivery process when a parcel is moved from a transportation hub (warehouse or a distribution center or fulfillment centre) to its final destination, which usually is a personal residence/retail store/ business, or parcel locker. It accounts for around half of the total cost involved in entire process of first mile, middle mile, and last mile delivery, though it can vary shipment to shipment, based on commodity, business model and similar factors. |
| Milkrun | A Milk Run is a delivery method used to transport mixed loads from various suppliers to one customer, using lean management principles applied to logistics. Instead of each supplier sending a truck every week to meet the needs of one customer, one truck (or vehicle) visits the suppliers to pick up the loads for that customer. This method of transport got its name from the dairy industry practice, where one tanker used to collect milk from several dairy farms for delivery to a milk processing company. A milk run can be a more efficient way to handle logistics but require proper planning. If the route involves products from different companies, there is need for an agreement about cost-sharing and other aspects of the cooperative delivery arrangement. Once the group settles these issues, this delivery method can save time and money for everyone by pooling operation costs and resources. |
| Multi country consolidation | Multi-Country Consolidation (MCC) is a cost-effective solution that consolidates one's cargo from different countries of origin to build Full Container Loads (FCL). MCC is most suitable for companies that import light volumes of goods from multiple countries but want to take advantage of the more economic FCL freight rates. Apart from costing some of the other advantages include (i) flexibility to choose suppliers from a wider range of origin countries without worrying about the logistics to final destination from each origin, (ii) ability to pick the most suitable suppliers from many different countries for one's business operations. The increase in one's sourcing options by MCC provides the kind of flexibility needed in competitive global markets. |
| Q-commerce | Q-commerce, also referred to as quick commerce, is a type of e-commerce where emphasis is on quick deliveries, typically in less than an hour. The companies providing Q-Commerce services might have vertically intergrated model or might be using third party delivery platforms (outsourced logistics). It has advantages like (i) competitve USP, (ii) potential to earn greater profit margins, (iii) better customer experience, (iv) guaranteed availability of products, (v) traceability, and (vi) scaleability. |
| ReverseLogistics | Reverse logistics is a type of supply chain management that moves goods from customers back to the sellers or manufacturers and may involve ciruclar economy principles (3Rs) viz. recycling, reuse (repurposing, reselling), reducing or repairing. In this regard, reverse commerce (or Recommerce) is the selling of previously owned items through physical or online marketplaces/distribution channels to buyers who reuse, recycle or resell them. |
Research Methodology
Mordor Intelligence follows a four-step methodology in all our reports.
- Step-1: Identify Key Variables: In order to build a robust forecasting methodology, the variables and factors identified in Step-1 are tested against available historical market numbers. Through an iterative process, the variables required for market forecast are set and the model is built on the basis of these variables.
- Step-2: Build a Market Model: Market-size estimations for the forecast years are in nominal terms. Inflation is considered to be a part of the pricing, and the average selling price (ASP) is varying throughout the forecast period for each country
- Step-3: Validate and Finalize: In this important step, all market numbers, variables and analyst calls are validated through an extensive network of primary research experts from the market studied. The respondents are selected across levels and functions to generate a holistic picture of the market studied.
- Step-4: Research Outputs: Syndicated Reports, Custom Consulting Assignments, Databases & Subscription Platforms
