Chile 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 0.77 Billion |
| Market Size (2026) | USD 0.83 Billion |
| Market Size (2031) | USD 1.10 Billion |
| Growth Rate (2026 - 2031) | 5.94% 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. | |
Chile Courier, Express, And Parcel (CEP) Market Analysis by Mordor Intelligence
The Chile Courier, Express, and Parcel (CEP) market size is projected to expand from USD 0.77 billion in 2025 and USD 0.83 billion in 2026 to USD 1.10 billion by 2031, registering a CAGR of 5.94% between 2026 and 2031. Rising subscription-commerce volumes, 2025 electric-vehicle incentives, and express spare-parts demand from digitized mining operations reshape competitive economics even as wage negotiations, carbon-tax escalation, and parcel fraud inflate operating costs. Operators with modern API stacks that eliminate tracking failures capture share from 60% of providers still running legacy systems, while public-private pick-up/drop-off (PUDO) partnerships, such as the Metro de Santiago autonomous-locker rollout, cut failed-delivery losses by up to 70%. Government subsidies covering 40% of e-van acquisition, plus accelerated depreciation, reduce the total cost of ownership by about 25% versus diesel fleets, driving early electrification in Santiago.
Key Report Takeaways
- By the end user e-commerce captured 33.18% of the Chile courier, express, and parcel market share, in 2025 and healthcare is forecast to expand at a 6.23% CAGR through 2031.
- By destination, domestic shipments accounted for 63.95% share of the Chile courier, express, and parcel market size in 2025, while international flows are projected to grow at a 6.15% CAGR between 2026 and 2031.
- By model, the B2C segment held 62.03% of the Chile courier, express, and parcel market share in 2025 and records the highest projected CAGR at 7.72% through 2031.
- By shipment weight, light parcels under 5 kg commanded 62.56% share of the Chile courier, express, and parcel market size in 2025 and are poised to advance at 6.53% CAGR to 2031.
- By speed of delivery, express services are forecast to grow at a 6.81% CAGR over 2026-2031, although non-express kept 75.20% share in 2025.
- By mode of transport, road retained 63.57% of the Chile courier, express, and parcel market size in 2025, while air is set to grow at 6.00% CAGR on the back of high-value perishables and urgent mining cargo.
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 2026.
Chile Courier, Express, And Parcel (CEP) Market Trends and Insights
Drivers Impact Analysis*
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Subscription-commerce boom boosting recurring parcel volumes | +1.4% | Urban centers, primarily Santiago, Valparaíso, Concepción | Medium term (2-4 years) |
| Government EV-logistics incentives are cutting operating costs | +1.1% | National, with early adoption in the Santiago Metropolitan Region | Short term (≤ 2 years) |
| Same-day spare parts demand from digitised mining operations | +0.8% | Northern mining regions, particularly Antofagasta, Atacama | Medium term (2-4 years) |
| Tele-pharma cold-chain home-delivery surge after 2024 reform | +0.9% | National, with a concentration in urban areas | Short term (≤ 2 years) |
| Metro de Santiago autonomous locker roll-out, widening PUDO network | +0.6% | Santiago Metropolitan Region, expanding to Valparaíso | Medium term (2-4 years) |
| LATAM Cargo late cut-off corridor unlocking higher-value exports | +0.5% | Export regions, particularly the central agricultural valleys | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
Subscription-Commerce Boom Boosting Recurring Parcel Volumes
Subscription models served 18% of Chilean online shoppers in 2024, creating predictable flows that let operators lift route density and trim unit costs 20-25%. Beauty, food, and pet-care boxes represent 65% of those volumes. High churn risk when deliveries fail pushes carriers to adopt real-time alerts and PUDO lockers, slashing failed-delivery expenses from USD 8-12 to USD 1.50-2.00. Foreseeable volumes also sharpen inventory planning, cutting fulfillment center cycle times 30-40%[1]Blink Charging, “Blink en 2024: ¡Grandes logros y avances en la movilidad eléctrica en Latam!,” blinkcharging.com.
Government EV-Logistics Incentives Cutting Operating Costs
The 2025 policy introduces a 40% purchase credit along with accelerated depreciation, reducing five-year ownership costs of electric vans by around 25-30% compared to diesel. Santiago is also targeting 500 fast chargers by the end of 2026, strengthening the ecosystem for fleet electrification. Since fuel and maintenance typically account for 35-40% of courier operating expenses, electric vehicles offer significant long-term savings and greater cost stability. However, adoption remains uneven, as smaller operators face high upfront costs of USD 45,000-55,000 and limited charging infrastructure in rural areas. Larger fleets are better positioned to lead the transition, while broader uptake will depend on improved financing options and continued expansion of charging networks[2]Ministerio de Energía, “Electric Vehicle Incentive Program 2025,” energia. gob.cl.
Same-Day Spare-Parts Demand from Digitized Mining Operations
IoT-enabled mining operations are willing to pay 200-300% rate premiums to minimize downtime, which can cost an estimated USD 1-2 million per day. In response, couriers are increasingly adopting forward-stocking strategies and offering guaranteed delivery windows of four to six hours, enabling them to achieve gross margins of 45-50%, significantly higher than the 15-20% typical for standard parcel services. This high-value logistics model, however, requires substantial working capital commitments of USD 2-5 million per client to maintain inventory readiness. For critical components valued above USD 50,000, providers often rely on specialized solutions such as helicopter transport to ensure rapid delivery. While capital-intensive, this segment highlights a shift toward premium, service-driven logistics where reliability and speed command significantly higher returns.
Tele-Pharma Cold-Chain Home-Delivery Surge After 2024 Reform
Mandatory insurance coverage for remote prescriptions drove a 180% surge in tele-pharmacy consultations in 2025. However, only 15-20% of logistics providers are equipped to maintain the required 2-8 °C cold-chain conditions, allowing compliant fleets to charge premium rates of USD 8-12 per delivery, well above standard parcel pricing. Supporting this capability requires specialized investments, including refrigerated vans costing USD 25,000-35,000 and advanced temperature monitoring systems. While the segment offers strong margin potential, it also demands strict compliance, operational discipline, and consistent quality assurance to meet healthcare standards[3]Ministerio de Salud, “Telemedicine and Remote Healthcare Regulations,” minsal.cl.
Restraints Impact Analysis*
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Wage-pressure from driver union negotiations is inflating costs | -0.7% | National, with the strongest impact in Santiago, Valparaíso | Short term (≤ 2 years) |
| Carbon-tax escalation raising diesel price and last-mile surcharges | -0.5% | National, affecting all diesel-dependent operations | Medium term (2-4 years) |
| Rising parcel fraud is forcing costly secure-delivery options | -0.4% | Urban areas, particularly the Santiago Metropolitan Region | Short term (≤ 2 years) |
| Legacy API integration gaps are causing tracking failures and SLA penalties | -0.3% | National, affecting operators with outdated systems | Medium term (2-4 years) |
| Source: Mordor Intelligence | |||
Wage-Pressure from Driver Union Negotiations Inflating Costs
Union agreements signed between 2024 and 2026 increased wages by 12-15% and raised overtime premiums, pushing total labor costs up by as much as 22%. In response, couriers are deploying route-optimization tools that improve delivery efficiency, lifting drops per hour by 15-20% and partially offsetting rising expenses. However, broader automation adoption remains constrained, as regulatory barriers continue to limit the deployment of autonomous vehicles. As a result, the sector is relying more on incremental productivity gains and technology-driven planning rather than full-scale automation to manage cost pressures.
Carbon-Tax Escalation Raising Diesel Price and Last-Mile Surcharges
The carbon levy is set to rise from USD 5 per tCO₂ in 2024 to USD 35 by 2030, increasing diesel costs by an estimated 8-10% annually. This creates a growing cost advantage for urban operators adopting electric vehicles, who can achieve savings of around 20-25% compared to diesel fleets. However, regional and long-haul routes are expected to remain largely diesel-dependent in the near term, as charging infrastructure outside major cities is still limited and unlikely to scale meaningfully before 2028. This divergence is reinforcing a two-speed transition, where urban networks electrify faster while rural operations lag due to infrastructure constraints[4]Ministerio de Hacienda, “Carbon Tax Implementation Framework,” hacienda.cl .
*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: Premium Healthcare Logistics Gains Momentum
By 2025, e-commerce accounted for 33.18% of Chile courier, express, and parcel market share, while the healthcare segment is projected to grow at a CAGR of 6.23% through 2031.
Specialist fleets earn USD 8-12 per medical delivery versus USD 3-5 for standard e-commerce, leveraging temperature logging and Norma Tecnica 151 compliance. Mining spare-parts courier work, though with a smaller volume, secures 200-300% premiums, enhancing blended margins for diversified carriers. Operators able to cross-utilize cold-chain capacity during non-peak hours reduce asset idle time and defend yields, while e-commerce-only couriers risk commoditization.
Note: Segment shares of all individual segments available upon report purchase
By Destination: International Parcels Outpace Domestic Plateau
Domestic service still made up 63.95% of Chile courier, express, and parcel market size in 2025, but international flows will expand at 6.15% CAGR on high-value perishables and CPTPP-driven SME exports. The Chile courier, express, and parcel market share for cross-border shipments climbs as late cut-off air corridors mature.
International operations cluster near Santiago and Valparaíso airports, demanding brokerage skill and cold-chain staging. Conversely, domestic growth slows as urban e-commerce penetration nears saturation, pushing carriers to improve service reliability rather than chase volume.
By Speed of Delivery: Express Premiumizes Revenue Mix
While non-express services continued to dominate the market with a 75.20% of Chile courier, express, and parcel market share in 2025, the express segment is set to grow at a CAGR of 6.81%, driven by time-sensitive demand from the mining and healthcare sectors. Higher margins in express logistics enable providers to invest in premium capabilities such as dedicated air freight capacity and advanced real-time tracking systems.
In contrast, economy services operate on significantly thinner margins, focusing on cost efficiency and high shipment volumes rather than speed. The growing need for rapid delivery of critical goods, including medical supplies and mining equipment, is accelerating the shift toward express solutions.
By Shipment Weight: Light Parcels Drive Density Economics
Parcels weighing under 5 kg held a 62.56% of the Chile courier, express, and parcel market size in 2025 and are projected to grow at a CAGR of 6.53%. High density lets EV vans load 150-200 items, aligning with battery payload limits and underpinning Chile courier, express, and parcel market size scalability at lower emissions.
Medium and heavy consignments remain critical for industrial clients, yet need lift-gate gear and two-person crews, pushing operators toward explicit weight-tier pricing.
Note: Segment shares of all individual segments available upon report purchase
By Mode of Transport: Air Cargo Finds New Altitude
Road transport retained a dominant 63.57% share in 2025, though it continues to face cost pressures from rising diesel taxes. Meanwhile, air shipments are projected to grow at a CAGR of 6.00%, supported by increasing demand for transporting perishables and time-critical spare parts that depend on belly-hold capacity in passenger aircraft.
As trade volumes and urgency requirements increase, reliance on air logistics is expected to strengthen, particularly for high-value and sensitive goods. However, the availability of belly-hold space remains closely tied to passenger flight recovery, which can constrain capacity during periods of limited air travel. This dynamic may push logistics providers to invest in dedicated freighter aircraft to ensure consistent service levels.
Note: Segment shares of all individual segments available upon report purchase
By Model: B2C Reigns Through Recurring Commerce
In 2025, the B2C segment accounted for 62.03% of the market and is expected to grow at the fastest rate, with a CAGR of 7.72%, driven by steady demand from recurring subscription boxes. Increased locker density allows cost-efficient hybrid drop solutions, cutting per-parcel costs to USD 1.50-2.00.
B2B shipments stay relevant for mining and pharma clinic resupply, but grow more slowly. C2C stabilizes after pandemic spikes, yet reverse-logistics complexity offers niche revenue where carriers integrate smart returns portals.
Geography Analysis
The Santiago Metropolitan Region accounted for approximately 40% of national parcel volumes in 2025, supported by a dense network of parcel lockers, plans for 500 fast-charging stations, and strong subscription-commerce activity. However, rising wage levels and increasing instances of fraud continue to push up urban operating costs, creating margin pressures for logistics providers. Despite these challenges, Santiago remains the core demand engine, driven by high consumer density and advanced fulfillment infrastructure.
Valparaíso and Concepcion serve as key secondary hubs, leveraging port connectivity and industrial ecosystems to support steady B2B logistics flows. In the north, Antofagasta and Atacama are more specialized markets focused on high-value, time-sensitive mining components, where air transport reduces transit times from 18–20 hours by road to just 2–3 hours, enabling premium same-day delivery.
The central valleys benefit from strong agricultural exports, particularly cherries, supported by dedicated air cargo corridors such as LATAM Cargo. In contrast, southern regions face challenges, including low population density and climate disruptions, leading carriers to price services 30-40% higher than Santiago levels. At the same time, emerging rural tele-pharmacy is creating incremental demand for light parcels, though it requires subsidized cold-chain logistics to remain viable.
Competitive Landscape
The Chile courier, express, and parcel industry shows moderate concentration. Chilexpress and Correos de Chile anchor national networks, while DHL, FedEx, and UPS compete on global reach and healthcare expertise. Blue Express leverages Empresas Copec backing to integrate API-rich platforms; its February 2025 alliance with Reversso and Uber Direct cut reverse-logistics cycle times by 30-40%.
Digital-native entrants position around seamless marketplace plugins, winning e-commerce merchants frustrated by legacy carrier data gaps. Players investing in EV fleets exploit 2025 incentives to gain 25-30% urban cost edge, while diesel-bound rivals absorb rising carbon-tax and fuel surcharges. Cold-chain capability differentiates DHL, Redmegacentro, and UPS after USD 15 million network upgrades in 2025.
Geographic specialization continues: Correos de Chile leverages state footprint for nationwide lockers, DSV consolidates cross-border e-commerce after Schenker integration, and FedEx targets mining fast-lane delivery with 4-6 hour guarantees. Cooperative route-sharing and API federation may emerge as a path for smaller regionals to preserve relevance.
Chile Courier, Express, And Parcel (CEP) Industry Leaders
Chilexpress
Correos de Chile
DHL Group
FedEx
Empresas Copec SA
- *Disclaimer: Major Players sorted in no particular order
Recent Industry Developments
- March 2026: Starken added 86 new pick up and drop off points through a strategic agreement with Autoplanet and Agroplanet, expanding its physical touchpoints.
- October 2025: Chilexpress sealed a partnership with Shell Chile’s Enex to deploy automated “Drop Off” modules for parcel dispatch and returns at Shell convenience stores (initially 14 sites in Metro Santiago) with plans to expand nationally.
- October 2025: Blue Express (part of Empresas Copec) launched a USD 100 million investment plan aimed at doubling capacity, installing smart lockers, and expanding distribution capabilities and centers nationally.
- February 2025: Blue Express partnered with Reversso and Uber Direct for two-hour e-commerce returns in Santiago, cutting cost per reverse shipment by 30-40%.
Chile 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 |
| 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 |
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
