In a gold rush, bet on the companies who sell picks and shovels. In the world of ecommerce that means logistics.
Parcel shipping is booming thanks to the rise in global ecommerce according to a new report from Pitney Bowes.
Australia tops the APAC region in terms of growth. The annual Parcel Shipping Index shows a growth of 8.8 per cent in the use of parcels in Australia in 2015 significantly in advance of the 2.9 per cent average growth across 12 major markets.
- Download the CMO of Tomorrow report produced by the Which-50 Intelligence Unit
According to Stephen Darracott, Country Manager, Pitney Bowes Australia and New Zealand Australian ecommerce retailers and SMBs continue to see growth in shipping volume and spend. But he cautioned, this growth is creating increasing complexity for businesses of all sizes.
“Parcel shipping is critical to many businesses, from order fulfilment and e-commerce to packages and flats shipped by businesses as part of their daily work flow. Increased demand has led to greater service options from an expanding number of global, national and regional carriers. However, managing multiple carriers and shipping goods across borders also creates new challenges and raises complexity. Small and medium businesses in particular are having trouble managing the growing number of shipping options, service levels and 24/7 tracking. ”
As online shopping booms in popularity, it can be challenging for retailers to maintain shipping processes that deliver a satisfying experience for customers, said Darracott. “Many retailers are turning to technology and the cloud to better manage data and track deliveries, ultimately ensuring an improved end-to-end customer experience.”
He told Which-50, “The rise in parcel shipping presents a great opportunity for Australian retailers. Increased demand has led to greater service options from an expanding number of global, national and regional carriers. With the right technology and partnerships there are new ways for Australian retailers to manage the complexity of cross-border retail and grow their overseas sales through parcel shipping.”
The Pitney Bowes 2016 Global Online Shopping Study also revealed that consumers are shopping in store on their overseas holidays and then returning to their home country and buying cross-border from those foreign retailers online. “While 47 per cent of Australians do it, the average of shoppers across Asia is much higher– Hong Kong (74 per cent), China (65 per cent) and Singapore (64 per cent) — 7 million international travelers visited Australia from July 2015-June 2016hey spent 14 per cent more than last year’s tourists.”
“This presents a real opportunity for Aussie retailers to welcome visiting shoppers, and ensure they have the data that allows them to market to them once they return home so they can continue to sell to their goods. And with this growth, retailers have increased capability and choice about how they ship their products cross-border.”
The authors of the study also forecast that the volume of parcel shipping will continue to grow annually at 5 to 7 per cent to achieve a total increase of 20 per cent by 2018, revealing cross-border shopping as the leading driver of growth.
The research measures both volume and spend for business-to-business, business-to-consumer, consumer-to-business and consumer consigned shipments. The weight was up to 31.5 kg (70 lbs.) in 12 major markets, consisting of Australia, Japan, India, the U.S., Canada, Brazil, Germany, the UK, France, Italy, Norway and Sweden.
Globally, the parcel shipping market is being driven by growth in ecommerce, with an increasing number of online shoppers around the world. According to the latest Pitney Bowes Global Online Shopping Survey, Australians are global leaders when it comes to online shopping:
- 88 per cent of Australians shop online, with almost half (47 per cent) shopping online monthly.
- 86 per cent of Australians purchased products online from retailers in a different country within the last year – second only to Singapore.
- 78 per cent of Australians bought online cross-border in the last month and the last year – the most in the world.
Based on proprietary and published data, the research confirms that the Australian parcel shipping market grew by 8.8 per cent in volume and 8.2 per cent in spend at AU$9.6 billion – the most growth in the Asia-Pacific region in 2015.
Australia’s growth rate topped the largest parcel shipping market in the Index, as U.S. parcel shipping volumes grew 3.6 per cent in 2015. Japan, the second largest parcel market in the Index, saw parcel volume dip by 1.7 per cent, despite the parcel shipping spend in Japan increasing by 2.6 per cent to ¥2,480 billion.
Overall, the Index reported 31 billion parcels shipped in 2015 in the markets studied, which is up 2.9 per cent compared to 2014. Furthermore, the Index forecasts parcel shipping volume to grow annually at 5 to 7 per cent for a total increase of 20 per cent by 2018, with cross border shipping leading the way.
“The growth of ecommerce and the expansion of parcel shippers in our market has led to increasing complexity for businesses of all sizes,” said Darracott.
According to Darracott, in Australia ecommerce retailers and SMBs in particular have a strong shipping opportunity and will continue to see growth in shipping volume and spend. In the next few years, technology will be key to combatting the complexity that comes with so many carrier choices, different service levels, and 24/7 tracking.
“Up and coming technologies like cloud-based multi-carrier shipping platforms will be crucial in helping businesses of all sizes to maximise efficiency, optimise parcel shipping operations and deliver the best possible customer experience,” he said.
“Technology will be key to combating the complexity that comes with so many carrier choices, different service levels, and 24/7 tracking. New and upcoming technologies, including cross-border and cloud-based multi-carrier office shipping platforms, can help businesses of all sizes optimise their parcel shipping operations to maximise efficiency and deliver the best possible customer experience.”
He also suggested there is growing demand for cloud-based solutions, which give businesses access to the latest technologies and services without the traditional up-front costs and IT support.
During the busy holiday shopping and shipping season, accurate and precise shipping is paramount for businesses around the world. The Pitney Bowes Global Online Shopping Survey found almost half of global shoppers reported some type of challenge with their online holiday orders in 2015.
Shipping issues such as the wrong address, lost items or tracking inaccuracies made up more than half of those issues. While Australia did better than the global average, 32 per cent indicated that they experienced shipping-related challenges when shopping online during the 2015 holiday season.
The Pitney Bowes Parcel Shipping Index focuses on business-to-business, business-to-consumer, consumer-to-business and consumer consigned shipments with weight up to 31.5 kg (70 lbs.).
All service levels, such as time definite deliveries, are included. Adjacent services offered by carriers such as freight forwarding, supply chain management and cargo shipments are excluded.