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United States Courier, Express, and Parcel (CEP) Market - Growth, Trends, and Forecasts (2022 - 2027)

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  • 400 Pages
  • January 2022
  • Region: United States
  • Mordor Intelligence
  • ID: 5530000

The United States CEP market is expected to reflect a growth rate of over 4% during the forecast period 2020-2025. The growth in the market is heavily backed by the developments in the e-commerce, manufacturing and pharmaceutical industries. Besides e-commerce, the emerging trends of omnichannel retailing in certain countries and growth in trade driven by economic growth are also some of the drivers of the CEP industry.

The implementation of the United States - Mexico - Canada trade agreement (USMCA) is expected to increase the trade opportunities and create a positive impact on the courier and express logistics industry.

The country is experiencing fast growth in the B2C market as compared to the B2B market, mainly due to the growth of the e-commerce market. The technological developments like the introduction of drone delivery services and e-locker delivery system are further creating opportunities for startups to enter the market.

The last-mile delivery is the crucial member of logistics, and final mile delivery costs represent almost half of the supply chain costs. Owing to this reason and to accommodate the rising demand to reach the consumer expectations, the CEP companies are integrating last-mile delivery into the existing services.

The last-mile delivery market is transforming, with companies looking at alternatives, such as delivery lockers, pickup points, crowdsourced deliveries, drone deliveries, and autonomous vehicles.

Key Market Trends

Positive Effects of Booming E-commerce and Omni-Channel Retailing

The increase in e-commerce trade over online portals has driven the growth of the CEP market. Various e-commerce activities, such as online shopping through e-retail portals, are expected to fuel the market growth during the forecast period. The modern approach to retail focuses on designing a well-rounded user experience at each touchpoint, creating a buying journey worthy of purchases in the modern era.

The omnichannel retailers, who seamlessly combine their online and in-store experience, have an excellent opportunity to cost-effectively meet consumer demand for faster delivery and increased control by utilizing new technologies to better leverage their existing physical infrastructure.

Such a rapidly growing adoption of online shopping across the country has brought increased volume and thus economies of scale for global logistics providers. But it has also placed substantial pressure on those providers who are constantly having to adapt to increased scale

Consumers spent USD 601.75 billion online with US merchants in 2019, up by 14.9% from USD 523.64 billion the previous year, according to the US Department of Commerce’s quarterly ecommerce figures. That was a higher growth rate than 2018, when online sales reported by the Commerce Department rose by 13.6% Y-o-Y.

Despite the Covid-19 pandemic, the US retail e-commerce sales for the second quarter of 2020 stood at USD 211.5 billion, an increase of 31.8% from the first quarter of 2020 and an increase of 44.5% from the second quarter of 2019.

Health products and groceries have been a key driver in this short-term growth. The pandemic has led companies toward ‘Supply Chain 4.0’ where they have the capability of being able to manufacture locally at the same cost of doing global sourcing. International companies may need to restructure, diversify, and ‘de-risk’ their supply chains in response to the COVID-19 pandemic but large-scale ‘near-shoring’ or ‘de-globalization’ are unlikely.

Healthcare Sector Driving the Demand for CEP Services in the Country

The CEP market in the healthcare and life sciences industry in the United States has grown significantly in recent years, with the rising demand for perishable items that mostly comprise pharmaceutical products, which necessitate express delivery systems across the country.

Most pharmaceutical manufacturers utilize express logistics services for their time-sensitive deliveries of the shipment of goods and equipment via multi-modal transportation, primarily through air and road freight transport mediums. As healthcare spending is increasing, the logistics associated with this are high and require specialized solutions. Due to this, the courier, express, and parcel delivery providers, and other logistics companies compete to provide their services. With increasing healthcare spending, the optimization of the supply chain is expected to be imperative for manufacturers/service providers.

Globally, with retailers closing their brick and mortar stores, shoppers are forced to shop online instead. In recent weeks, this surge in demand has seen the online retailer, Amazon, hiring more than 100,000 new workers in the United States, to fulfil orders. In this digital age, all courier businesses are affected and rely on technology, and this reliance is even more considerable during these unprecedented times.

With more consumers moving from offline to online shopping, courier companies have witnessed a rise in businesses delivering goods amid the COVID-19 pandemic restrictions, especially during festivals. Delivery companies have managed to book growth amid the pandemic-induced economic downturn because citizens stay at home, to comply with regional administrations’ large-scale social restrictions.

Competitive Landscape

The US CEP market is consolidated in nature and is dominated by three main players which include United Parcel Service Inc., FedEx Corporation and USPS. To leverage the opportunity of fast growth in the CEP industry, many new start-ups based in the United States or expanding from other countries have entered the market. As a result of increasing market activity, the industry observes high competition among the players.

In the future, the sector’s growth and challenges will be mainly in the area of last mile. The concept of the final mile is driving the companies to focus on mergers and collaborations that not only helps them to expand globally but also enhance their service quality holistically. For instance, in 2019, FedEx Company announced its plans to expand its FedEx Ground Service to seven days a week year-round operations.

In December 2019, J.B. Hunt announced the acquisition of RDI Last-Mile Co., increasing the company's final mile services division to 104 locations and more than 3.1 million square feet of warehousing space.

Also in 2019, spurred by a record volume and e-commerce growth, Purolator announced its plan to invest more than USD 1 billion through a five-year strategy, delivering the future growth and innovation strategy.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support

This product will be delivered within 2 business days.

Table of Contents

1.1 Study Assumptions
1.2 Scope of the Study
4.1 Current Market Scenario
4.2 Value Chain/Supply Chain Analysis
4.3 Government Regulations and Initiatives
4.4 Technological Trends and Automation in the US CEP Industry
4.5 Insight on US Mail and Postal Services (Current Scenario, Mail Volume, etc)
4.6 Insights into the E-commerce Industry (Domestic and Cross-border E-commerce)
4.7 Insights into Start-ups and Venture Capital Funding in the CEP Industry
4.8 Elaboration on Storage Functions and Value-added Services in CEP Business
4.9 Brief on Courier Rates
4.10 Insights into Reverse Logistics and Same-day Delivery Market
4.11 Insights into Deliveries During Festive Season (Christmas, Singles' Day, Black Friday, etc.)
4.12 Impact of COVID-19 on the Market
5.1 Market Drivers
5.2 Market Restraints/Challenges
5.3 Market Opportunities
5.4 Industry Attractiveness - Porter's Five Forces Analysis
6.1 By Channel of Distribution
6.1.1 B2B (Business-to-business)
6.1.2 B2C (Business-to-consumer)
6.2 By Destination
6.2.1 Domestic
6.2.2 International
6.3 By End User
6.3.1 Services (BFSI (Banking, Financial Services, and Insurance), etc.)
6.3.2 Wholesale and Retail Trade (Including E-commerce)
6.3.3 Life Sciences/Healthcare
6.3.4 Industrial Manufacturing
6.3.5 Other End Users
7.1 Overview (Market Concentration and Major Players)
7.2 Company Profiles
7.2.1 United Parcel Service Inc.
7.2.2 FedEx
7.2.3 Deutsche Post DHL Group
7.2.4 United States Postal Service (USPS)
7.2.5 OnTrac Inc.
7.2.6 Expeditors
7.2.7 TFI International
7.2.8 Spee Dee Delivery Service Inc.
7.2.9 Aramex
7.2.10 YRC Worldwide
7.2.11 Purolator
7.2.12 LaserShip
7.2.13 Courier Express*
7.3 Other Companies (Key Information/Overview)
7.3.1 (Amazon, Atlantic International Express, A-1 Express Logistics, USA Couriers, Postmates, Deliv, Routific, Roadie, American Expediting, Koch Cos Inc.)*
9.1 Macroeconomic Indicators (GDP Distribution by Activity, Contribution of Transport, and Storage Sector to the Economy)
9.2 Insights into Capital Flows (Investments in the Transport and Storage Sector)
9.3 E-commerce and Consumer Spending-related Statistics
9.4 External Trade Statistics (Detailed Imports and Exports Statistics)