Canada Courier, Express, And Parcel (CEP) Market Size and Share
Market Overview
| Study Period | 2020 - 2031 |
|---|---|
| Forecast Data Period | 2026 - 2031 |
| Base Year Market Size (2025) | USD 15.37 Billion |
| Market Size (2026) | USD 16.10 Billion |
| Market Size (2031) | USD 20.67 Billion |
| Growth Rate (2026 - 2031) | 5.12% 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. | |
Canada Courier, Express, And Parcel (CEP) Market Analysis by Mordor Intelligence
The Canada courier, express, and parcel (CEP) market size is projected to be USD 15.37 billion in 2025 and USD 16.10 billion in 2026, and reach USD 20.67 billion by 2031, growing at a CAGR of 5.12% from 2026 to 2031.
Rising direct-to-consumer (D2C) sales, widespread parcel-locker deployment, and federal incentives for zero-emission delivery fleets are deepening service intensity across urban corridors. Lightweight cross-border inflows taking advantage of Canada’s CAD 150 (USD 110) de minimis threshold continue to boost air-express volumes while compressing last-mile margins. Carriers are prioritizing fleet electrification and IT security investments as Toronto, Vancouver, and Montreal roll out zero-emission access zones and PIPEDA compliance deadlines tighten. At the same time, strategic acquisitions such as UPS’s CAD 2.2 billion (USD 1.6 billion) purchase of Andlauer Healthcare signal a pivot toward temperature-controlled and high-margin healthcare logistics.
Key Report Takeaways
- By destination, domestic shipments led with 63.27% of the Canada courier, express, and parcel (CEP) market share in 2025, whereas international parcels are forecast to expand at a 5.98% CAGR between 2026 and 2031, the fastest rate in the segment mix.
- By speed of delivery, non-express services commanded 71.81% market share in 2025, while express offerings are projected to grow at 6.37% CAGR through 2031.
- By business model, B2C flows accounted for 55.42% revenue in 2025, whereas C2C shipments are advancing at 8.54% CAGR over 2026-2031.
- By shipment weight, light parcels under 5 kg held 62.36% of the Canada courier, express, and parcel (CEP) market size in 2025.
- By mode, road maintained 67.83% share in 2025, but air cargo is the fastest-growing channel with a 6.71% CAGR outlook.
- By end-user, e-commerce generated 34.71% of 2025 revenue, whereas healthcare logistics is on track to deliver the highest incremental margin gains to 2031.
Note: Market size and forecast figures in this report are generated using Mordor Intelligence’s proprietary estimation framework, updated with the latest available data and insights as of January 2026.
Canada Courier, Express, And Parcel (CEP) Market Trends and Insights
Drivers Impact Analysis*
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Proliferation of direct-to-consumer shipping models | +1.4% | GTA, Metro Vancouver, Montreal CMA | Medium term (2-4 years) |
| Retailers’ sub-24-hour fulfillment commitments | +1.1% | Toronto, Vancouver, Calgary, Ottawa–Gatineau | Short term (≤ 2 years) |
| Surge in lightweight international parcels under de minimis | +0.8% | Border corridors, major airports, Pacific Gateway | Long term (≥ 4 years) |
| Nationwide parcel-locker roll-out | +0.6% | Dense urban areas, transit hubs, retail anchors | Medium term (2-4 years) |
| Rising demand for temperature-controlled healthcare logistics | +0.5% | Provincial capitals, large metros | Long term (≥ 4 years) |
| Federal incentives accelerating zero-emission fleets | +0.4% | Ontario, Quebec, British Columbia | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
Proliferation of Direct-to-Consumer Shipping Models
Brands selling straight to households are displacing wholesale channels, converting bulk pallet moves into millions of single-unit parcels. Statistics Canada recorded CAD 90.4 billion (USD 66.3 billion) in online sales during 2024, and Shopify’s global merchant base surpassed 2 million, making low-volume merchants a sizeable lane for every carrier. Service providers must therefore optimize stop density and keep revenue per drop viable even as average shipment weight declines. Carriers deploying dynamic-routing algorithms and robotic sortation mitigate margin pressure, but success still depends on filling delivery vans beyond 85% capacity. D2C growth remains strongest in fashion, health-and-beauty, and specialty foods, categories where rapid delivery underpins brand loyalty[1]“Retail e-commerce sales,” Statistics Canada, STATCAN.GC.CA.
Retailers’ Sub-24-Hour Fulfillment Commitments
Walmart Canada’s CAD 6.5 billion (USD 4.51 billion) modernization program and Loblaw’s nationwide PC Express expansion underline the new baseline for same-day delivery. Micro-fulfillment nodes inside dense metros shorten line-haul distances to under 15 km, but real-estate scarcity has pushed GTA warehouse vacancy below 2%. Courier partners now dedicate branded fleets to single retailers, trading scale economies for contractual volume. Extended evening and weekend runs safeguard customer convenience yet inflate shift premiums by 18-25%. Competitive necessity limits carriers’ ability to pass these costs through, reinforcing price compression in the Canada Courier, Express, and Parcel market[2]“Transportation Projects,” City of Toronto, TORONTO.CA.
Surge in Lightweight International Parcel Inflows Under De Minimis Thresholds
Canada’s CAD 150 (USD 110) duty-free ceiling continues to attract United States and Asian sellers; platforms like Temu and Shein flood Vancouver and Toronto gateways with slim packages that clear faster under CBSA’s new CARM interface. Integrators owning brokerage arms outperform rivals by resolving data filings in near real time. Nevertheless, volume spikes are straining belly-hold capacity, forcing seasonal freighter charters that lift unit costs by up to 30%. Customs errors prompt costly holds, making data integrity a new competitive metric. Over the long haul, cross-border growth will hinge on policy stability around de minimis limits.
Nationwide Roll-Out of Automated Parcel-Locker Networks
InPost surpassed 500 automated lockers by 2025, and Penguin Pickup now partners at more than 1,000 retail points. Locker density optimally one unit per 3,000-5,000 residents cuts failed-delivery attempts that otherwise cost carriers up to CAD 10 (USD 7.30) each. Consumer adoption is highest among condo dwellers constrained by building access rules. Canada Post’s FlexDelivery alliances with Shoppers Drug Mart provide a public-sector counterweight, embedding hybrid pick-up models into legacy postal routes. Municipal zoning variances, however, still slow deployment outside large metros.
Restraints Impact Analysis*
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Escalating courier wage bills and fuel surcharges | -0.9% | National, metro hot spots | Short term (≤ 2 years) |
| Margin erosion from price-led rivalry | -0.7% | Urban centers | Medium term (2-4 years) |
| Urban zero-emission zones restricting diesel vans | -0.3% | Toronto, Vancouver, Montreal cores | Medium term (2-4 years) |
| Growing cybersecurity outlays for parcel data systems | -0.2% | National | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
Escalating Courier Wage Bills and Fuel Surcharges
Transportation and warehousing wages climbed 4.8% year-over-year in 2024, outstripping general inflation. Amazon’s USD 100 million wage hike for Canadian staff set a new floor that squeezed thinner-capitalized regional carriers. Diesel swings between CAD 1.40-1.80/L (USD 1.03-1.32) complicated surcharge formulas disliked by retail shippers. Contractor models help some providers contain payroll, yet triple-digit annual churn erodes service quality. Optimization software delivers incremental productivity, but a driver-centric business still means labor costs remain the largest spend bucket[3]“Average hourly and weekly earnings,” Statistics Canada, STATCAN.GC.CA .
Margin Erosion from Intensifying Price-Led Rivalry
Amazon Logistics and nimble tech start-ups undercut rates, slicing TFI International’s Package & Courier revenue by 8% year-over-year in Q4 2024. UPS answered with Ground Saver in 2025, launching a budget tier that drags yields downward. Mid-market incumbents chase niches white-glove installation, reverse logistics for differentiation, but these services inflate training and equipment costs. Cross-border players importing United States rate structures widen the gap, pressuring domestic carriers to revisit cost bases. Competitive churn will persist as long as price remains the deciding factor for SMB shippers[4]“PIPEDA,” Office of the Privacy Commissioner, PRIV.GC.CA.
*Our updated forecasts treat driver/restraint impacts as directional, not additive. The revised impact forecasts reflect baseline growth, mix effects, and variable interactions.
Segment Analysis
By End-User Industry: E-Commerce Sustains Leadership
Online retail generated 34.71% of FY 2025 revenue and will grow 4.62% annually through 2031, keeping the Canada Courier, Express, and Parcel market the logistics backbone of Canadian shopping. Mobile checkouts now exceed 55% of all transactions, favoring carriers offering real-time tracking and delivery preference toggles.
Healthcare is emerging as a margin powerhouse as biologics gain share, justifying investments in GDP-compliant depots. Manufacturing and wholesale trade remain steady but less dynamic, as digitization curbs physical document movements historically served by couriers.
Note: Segment shares of all individual segments available upon report purchase
By Destination: International Parcels Outpace Domestic Growth
International parcels are growing at a 5.98% CAGR through 2031, surpassing domestic growth even though domestic flows still made up a 63.27% market share of the 2025 value in the Canada Courier, Express, and Parcel market size. Duty-free thresholds entice United States and Asian e-sellers, inflating air-inbound volumes and keeping customs brokerage a premium service line. Carriers integrating brokerage and clearance APIs reduce dwell times, winning loyalty from cross-border merchants.
In contrast, domestic momentum benefits from D2C retail strategies and retailers’ sub-24-hour promises that swell urban parcel density. Road networks dominate these lanes, though zero-emission ordinances will pivot short-haul city routes toward electric vans. Rural Canada, however, remains cost-intensive, maintaining tariff premiums to cover sparse stops.
Note: Segment shares of all individual segments available upon report purchase
By Speed of Delivery: Express Services Gain Share
While non-express retained 71.81% market share in 2025, express shipments are sprinting ahead with a 6.37% CAGR through 2031, adding incremental revenue faster than any other speed tier. Retailers leverage micro-fulfillment nodes to cut cycle times, transforming same-day delivery from a perk to the norm in major metros.
Healthcare and high-value electronics amplify demand for time-definite services where delay costs outweigh surcharges. Drone test corridors around Edmonton and impending Transport Canada BVLOS approvals may offer future cost relief, yet scale economics still favor ground couriers for distances under 50 km. For now, the Canada Courier, Express, and Parcel market relies on electrified vans to reconcile express service speeds with looming emission caps.
By Shipment Weight: Light Parcels Dominate Volume and Growth
Parcels under 5 kg held a 62.36% market share of the 2025 Canada courier, express, and parcel market and are tracking a 5.23% CAGR to 2031. Automated sorters and robotics make small-item handling highly scalable, a core reason Amazon added two Canadian robotics sites in 2024.
Medium-weight goods, from auto parts to mid-size consumer durables, fill the middle ground with balanced cost-to-speed trade-offs. Heavy shipments, often white-glove deliveries of furniture and appliances, keep profitability via accessorial fees but grow more slowly because many buyers still prefer in-store pickup for bulky items.
Note: Segment shares of all individual segments available upon report purchase
By Mode of Transport: Air Cargo Captures Express Growth
Road maintained 67.83% market share in 2025, but air’s 6.71% CAGR underscores the tradeoff retailers accept for speed. National Trade Corridors Fund grants expand apron capacity at Pearson and Vancouver, yet belly-hold space remains finite during Q4 peaks.
Electric trucks promise emission-free urban coverage, whereas long-haul aviation stays conventional given battery-density limits. Consequently, integrated networks that hand off seamlessly from freighter to electric van will define service reliability in the Canada courier, express, and parcel market.
By Business Model: C2C Emerges as Fastest-Growing Segment
C2C parcels, though the smallest slice, soar at an 8.54% CAGR as Canadians liquidate personal goods on Facebook Marketplace, Kijiji, and eBay. The Canada Courier, Express, and Parcel industry is responding with consumer-friendly apps, flat-rate labels, and supermarket drop-off kiosks that sidestep enterprise contracts.
B2C continues to anchor volume at 55.42% market share, powered by omnichannel retailers outsourcing last-mile execution. Walmart Canada’s fleet divestiture to Canada Cartage typifies the shift toward third-party delivery ecosystems. B2B shipments stand resilient in manufacturing supply chains but yield slower growth as digital documentation reduces physical exchange.
Geography Analysis
Population clustering within 150 miles of the United States border generates dense origin-destinations along the Quebec City–Windsor corridor and the Lower Mainland. Ontario alone contributed more than one-third of 2025 parcel volumes, a function of its manufacturing base and GTA consumer density. GLS’s Vaughan super-hub, leased in January 2025, exemplifies how carriers co-locate near 400-series highways to secure same-day reach to 10 million residents.
British Columbia anchors Pacific inflows; YVR’s cargo precinct processes surging e-commerce parcels arriving from Asia, pushing carriers toward dedicated freighter charters during peak Singles Day and Black Friday periods. Alberta and the Prairies present distance economics challenges, yet Edmonton International’s drone corridor demonstrates how technology may bridge cost gaps to remote communities.
Northern territories suffer sparse volumes; weekly service models prevail, and Canada Post remains the lifeline. Parcel-locker expansion concentrates in urban cores, deepening a two-tier access model where city dwellers enjoy 24/7 pick-up while rural consumers face longer delivery windows and surcharges.
Competitive Landscape
Market fragmentation persists even as global integrators deepen specialization. UPS now controls Canada’s largest cold-chain fleet after its Andlauer acquisition, tilting healthcare volumes toward a single provider. Amazon Logistics continues to disrupt with in-house capacity, but January 2025 closures of seven Quebec sites show it is not invincible, prompting third-party contractors to absorb spillover volume.
Regional challengers like Intelcom leverage proprietary tech stacks to offer custom services retailers cannot secure from integrators without premium pricing. Parcel-locker operators InPost and Penguin Pickup shift customer behavior toward out-of-home models that lower failed-delivery overheads. TFI International’s revenue slide signals pressure on legacy networks lacking cutting-edge IT or healthcare credentials.
Cybersecurity and sustainability have morphed into strategic differentiators. Carriers with ISO 27001 certification and fleet electrification roadmaps now win corporate tenders that weigh ESG and data privacy alongside rate cards. Over the forecast window, competitive advantage will hinge on capital access for technology, zero-emission fleets, and specialized cold-chain assets.
Canada Courier, Express, And Parcel (CEP) Industry Leaders
Canada Post Corporation (including Purolator)
FedEx
United Parcel Service of America, Inc. (UPS)
TFI International Inc.
DHL Group
- *Disclaimer: Major Players sorted in no particular order
Recent Industry Developments
- April 2025: DSV closed its USD 14.3 billion takeover of DB Schenker, creating the world’s largest forwarder with expanded Canadian cross-border freight corridors.
- April 2025: UPS completed the CAD 2.2 billion (USD 1.6 billion) purchase of Andlauer Healthcare, scaling Canada’s biggest pharma-grade network.
- April 2025: UPS launched Ground Saver and Ground with Freight Pricing to court cost-sensitive SMB shippers.
- February 2025: Walmart Canada outsourced its fleet to Canada Cartage as part of a CAD 6.5 billion (USD 4.51 billion) supply-chain revamp.
Canada Courier, Express, And Parcel (CEP) Market Report Scope
| 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 |
| By Destination | Domestic |
| International | |
| By Speed of Delivery | Express |
| Non-Express | |
| By Model | Business-to-Business (B2B) |
| Business-to-Consumer (B2C) | |
| Consumer-to-Consumer (C2C) | |
| By Shipment Weight | Heavy Weight Shipments |
| Light Weight Shipments | |
| Medium Weight Shipments | |
| By Mode of Transport | Air |
| Road | |
| Others | |
| By End User Industry | E-Commerce |
| Financial Services (BFSI) | |
| Healthcare | |
| Manufacturing | |
| Primary Industry | |
| Wholesale and Retail Trade (Offline) | |
| Others |
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
