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Report pegs courier trends
Toronto--Infobase Marketing Inc. (Toronto) has released its latest report on the courier industry. The Canadian Courier Industry Market Trends Report outlines more than 44 trends, but five are most relevant to shippers.
In particular, the study found courier companies are starting to behave as fully integrated logistics providers. They're not just shipping small packages anymore.
All the major courier companies now have separate supply chain divisions and even the smaller firms are getting involved in non-traditional services such as warehousing. The shift is allowing shippers to reduce the number of logistics providers they use, and should also provide cost savings. The report also noted the following points:
• Shippers have more visibility. Courier companies are using technology to improve service, especially in shipment visibility. Field scanning devices have improved, and visibility is benefiting to a lesser degree from RFID pilot projects. Technology is also giving a boost to routing software, and automatic sorting systems.
• Security is a huge priority. Shippers are diligently working to become certified to a myriad of border control programs, such as PIP and C-TPAT. Working with a courier who isn't knowledgeable and certified to these programs just isn't an option for importers and exporters.
• Shipments are consolidated. One of the largest areas of growth over the past few years is "drop shipping." Many courier companies allow shippers to transport their goods out of Canada as a consolidated load (which saves on transportation and customs clearance fees). The shipment is then broken down in the destination country and delivered to individual end customers.
• The market has fewer players. Major courier companies held an estimated 81 per cent of the market in 2005. The number of tier-one courier companies has decreased, following the purchase of RPS by FedEx and Loomis by DHL. Bigger companies can invest in more sophisticated technology, but less competition means shippers will have to keep a careful eye on rates.
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