Download the 2019 IPC Global Postal Industry Report Key Findings report here.
Posts are delivering more B2C parcels than ever before
Volumes of parcels (weighing 2-30kg) delivered by posts grew 9.1% on average in 2018, while their aggregate volumes have almost doubled since 2008. However, volume growth still lags behind that of the e-commerce market, which quadrupled in size over the same period, offering posts opportunities for further development.
"E-commerce remains the engine for postal industry growth. And with global e-commerce sales predicted to roughly double over the next five years, delivery firms are competing intensely to offer faster, cheaper and simpler solutions to consumers and e-retailers alike", said Holger Winklbauer, CEO of IPC.
Driven by growth for lightweight e-commerce packets, as well as rate increases, posts saw aggregate mail revenue grow €1.8bn in 2018, despite accelerating volume decline. Mail volumes were down 5.9% on average in 2018, following a 5.0% average drop in 2017.
Posts continue to diversify…
As mail volumes continue to fall, posts are seeing increasing value in diversification: close to two thirds have seen mail revenue shares fall since 2013. Non-mail services accounted for 67.5% of industry revenue in 2018, with some posts generating as little as 10% of revenue from mail. Alongside parcels, financial services were a key driver for industry growth in 2018.
In pursuit of new revenue opportunities, posts have acquired controlling stakes in almost 300 companies since 2008, with more than half of new subsidiaries operating in the parcels and logistics sectors. Moreover, just under a third of acquisitions were made in nearby or neighbouring markets, as posts continued to seek international growth, particularly in sectors that support e-commerce.
… and increase competitiveness in e-commerce markets
With e-commerce growth continuing apace, global integrators, regional delivery firms, e-retailers and start-ups are looking to gain a firmer foothold in the B2C delivery market. As competition for e-commerce delivery heats up, price and cost pressures persist for posts. Many have launched targeted efficiency initiatives to streamline and modernise their delivery and retail networks, but profitability continues to be squeezed. While average revenue growth remained stable in H1 2019, at 2.6%, posts’ EBIT margins dropped to 2.2% on average, down from 3.2% in H1 2018.
Winklbauer concludes: “In the light of strong competition, posts worldwide are investing to meet the needs of customers both today and tomorrow, strengthening their positions in growth markets such as e-commerce logistics, while at the same time bolstering their digital capabilities. It will be interesting to see which kind of business models the posts will keep in order to grow their position on the e-commerce markets.”
The above insights are published today in IPC’s publicly available key findings report, which provides a distillation of data and analysis included in the full IPC Global Postal Industry Report 2019. Published annually and now in its eleventh edition, the full report covers 50 postal operators from Europe, North America, Asia Pacific and BRICS countries, as well as integrators UPS and FedEx. While aiming to deepen understanding about key trends shaping the postal industry, the report also benchmarks the performance of individual posts both against their peers and an industry average. The full IPC Global Postal Industry Report is available for purchase by stakeholders outside the IPC membership.
The full IPC Global Postal Industry Report 2019 analyses the following 50 postal operators: An Post; Australia Post; bpost; Canada Post; China Post; Chunghwa Post; Correios Brasil; Correos; Correos de Mexico; Croatian Post; CTT Portugal Post; Cyprus Post; Czech Post; Deutsche Post DHL; Eesti Post; Hellenic Post-ELTA; Hongkong Post; Iceland Post; India Post; Japan Post; Korea Post; Latvian Post; Le Groupe La Poste; Lithuania Post; Magyar Posta; New Zealand Post; Österreichische Post; PHLPost; POST Luxembourg; Poczta Polska; Pos Indonesia; Pos Malaysia; Posta Romana; Posta Slovenije; Poste Italiane; Posten Norge; Posti Group; PostNL; PostNord; PTT-Turkish Post; Royal Mail; Russian Post; Singapore Post; Slovenska Posta; South African Post Office; Swiss Post; Thailand Post; Ukrposhta; United States Postal Service; Vietnam Post.
About International Post Corporation
International Post Corporation (IPC) is the leading service provider of the global postal industry that provides leadership by driving service quality, interoperability and business-critical intelligence to support posts in defending existing business and expanding into new growth areas. It is a cooperative association of 25 member postal operators in Asia Pacific, Europe and North America. IPC’s solutions and services are used by over 180 posts worldwide. Since 1989 IPC has set standards for upgrading quality and service performance and developed technological solutions that help members enhance service for international letters, packets and parcels. IPC engages in industry research, creates business-critical intelligence, provides a range of platforms and programmes for member post CEOs and senior management to exchange best practices and discuss strategy. IPC also manages the system for incentive-based payments between postal operators.
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