A global pandemic. Increasing numbers of people working remotely. Heightened need for fast and accurate sharing of vital medical and health care information. Escalating e-commerce activity. Rising need for sharing documents and equipment between remote or multiple working sites. Transforming retail business models as local stores increasingly function as fulfillment centers. There is no doubt recent events and changing consumer perceptions and behaviors are illuminating and amplifying the importance a strategically designed courier and messenger program has on the performance and ultimate success of your organization.
Clearly the impact of business lockdowns and varying shelter-in-place orders is having a huge impact on how people work, live and interact. Yet the truth is these recent challenges intensify and accelerate continuously evolving trends and patterns of consumer behavior rather than create them. Here are three results-oriented mechanisms for managing and optimizing current and anticipated market conditions and proactively developing strategic messenger and courier plans that transform change into opportunity.
MARKET OVERVIEW OF THE MESSENGER AND COURIER SERVICES INDUSTRY
Research and Markets reports “the global courier and messenger market reached a value of nearly $541.6 Billion in 2019, having grown at a Compound Annual Growth Rate (CAGR) of 9.3% Since 2015, and is expected to grow at a CAGR of 11.1% to nearly $824.9 Billion by 2023.”1 The report examined two distinct four-year periods, 2015 to 2019, identified as the historic period, and 2019 through 2023, termed the forecast period.
Overall the sector earned a 9.3% CAGR between 2015—2019 resulting primarily from heightened demand in the medical and health care industries, a continued rise in e-commerce, increased consumer spending and further expansion of emerging markets. Growth was marginally inhibited by escalating crude oil prices at the beginning of the historic period coupled with limitations in supply chain visibility.
The study segmented courier and messenger services into two types: domestic and international. The domestic market segment accounted for just over 80% of all revenues generated in 2019, or $437.92 billion. Despite its lower volume, the international market is experiencing a faster rate of growth with a CAGR of 11.5%.
Research and Markets further distinguishes the market by coverage type: local messengers and delivery (such as MMS) over against global express delivery services (FedEx, DHL, UPS, USPS). The express delivery services market is the larger of the two cohorts cornering just shy of 94% of the $541.6 billion revenue stream, or $507.5 billion. That being said, the local messenger and delivery market is projected as the fastest-growing segment going forward with an impressive 14.9% CAGR. The industry experiences near equal shares of B2B and B2C activity. Although B2B end-users slightly eclipsed B2C with a 58% share of the market ($314.2 billion) B2C shows greater growth potential as restaurants, retailers, pharmacies, health care providers, intra-business logistics and other consumer-focused services gain steam and consumer confidence. As a result, the study forecasts a 16% CAGR for the B2C market.
The leadership team at Michael’s Messenger Service (MMS) believe these data impact your business in three ways: 1) Increased consumer demand and expectations in both B2B and B2C channels requires maximum Agility in serving your clients, customers, and/or patients; 2) Urgency, unexpected spikes in demand and customer expectations of getting what they want when they want it mean you must be Accessible when and where need arises; 3) Accuracy in cost, pick-up and delivery timing and value chain visibility necessitate leading edge technology that automates the delivery process, from order entry through comprehensive reporting, budgeting and planning.
DEVELOPING AND OPTIMIZING YOUR AGILE BUSINESS MODEL
According to published reports from Accenture there is a direct correlation between escalating e-commerce activity and the duration and limitations of shelter in place orders. Some behaviors will be permanent as people become more comfortable and trusting of transacting business online. Which means consumers who rarely if ever purchased goods or services via the Internet are now doing so out of necessity. And they are growing accustomed to doing so. The Accenture study found “consumers who used online channels for less than 25% of purchases prior to the pandemic went from 1 in 20 of their purchases being online to 1 in 6 – a 160% increase in online activity. In May of this year e-commerce sales in the U.S. leaped by almost 93%, making up 22% of all retail sales—double the percentage from the prior year.
Things move at break-neck speeds these days. Urgency is no longer a special circumstance — it’s standard operating procedure. Of course, that doesn’t mean costs and capital expenditures can be ignored. Rather, they must be precisely budgeted and meticulously managed. I need it now, on-demand service and just-in-time are not fads. They are phrases that define the way things are. But they don’t have to lead to increased pressure or stress.
One step MMS took in addressing this challenge is establishing a business model utilizing independent contract drivers, or vendors, as its sole source of providing courier and messenger services. This means you can scale-up or scale-down based on immediate business need.
MMS also prefers contract operators drive rigorously inspected, well-maintained, fuel-efficient sedans for better maneuverability in traffic and great flexibility in accessing pick-up and delivery locations. Training and compliance with OSHA, IATA, TSA, and HIPAA regulations and knowledge in the correct handling and transport of ambient, refrigerated, and frozen specimens provide added assurances you can provide your organization first-rate services with complete confidence — whether you are transporting PPE to critical frontline staff in hospital and hospice, delivering diagnostic test samples from medical center to lab, shuttling pharmaceutical products to LTC outlets or expediting palliative care medications for in-home continuum of care.
Accenture estimates that 50% of all deliveries will be local by the end of 2020. One trend supporting this conclusion is the limited or spotty access to physical stores since March. Retailers are responding by using couriers like MMS for fulfilling orders directly from the nearest store with the product in stock. Retailers saw a 195% increase in click and collect order dollars, according to Accenture research4, and demand for small, local warehouse space is surging5. Both trends indicate retailers are hastening the transformation of brick-and-mortar facilities into localized fulfillment centers. At the same time MMS vendors report stepped up activity around moving laptops, computers and other office equipment between branches or to remote workers at home and messengering important legal or organization documents. All of which accentuate the imperative that your operating model include an Agile courier and messenger program.
END-TO-END VISIBILITY GIVES YOU GREATER CONTROL AND ACCURACY
While the speed and urgency of business demand Agility, they also call for elevated levels of transparency and Accuracy. Especially given the uncertain economic climate and unique challenges you now face. For example, even in situations where scheduled pick-up and deliveries are in place no two days are the same. Each delivery most likely involves different people with varying expectations. That means the highest levels of consistency and professionalism are imperative.
That is precisely why MMS provides an automated end-to-end workflow. And even though the proprietary seven-step process is Internet-based, there are still opportunities for human intervention as circumstances dictate. This ensures your delivery route or on-demand shipment request is handled in the most efficient, time-sensitive fashion possible. Which pretty much defines Accuracy.
The customizable e-courier application provides you with complete visibility and control over all transactions and account activity. As a result, you always know the cost, expected pick–up and delivery times, and whereabouts of your package or parcel. Plus, you have a digitized record of all shipments over time — an invaluable asset when reporting, forecasting, and budgeting for annual business plans.
DEVELOPING AND SUSTAINING END-TO-END VISIBILITY
Technology is the key component that brings Agility, Accuracy and Accessibility together and turns them into a strategic advantage for your organization. Which means you need leading-edge technology in scheduling, routing, expediting, and finalizing all of your deliveries — whether via regularly scheduled route, on-demand shipments or intra-organization messenger. MMS utilizes and recommends e-courier as the best solution for accomplishing that objective.
E-courier is a purpose-built, web-based technology ensuring complete visibility from start to finish of the delivery process. And it is accessible from your desktop, laptop, mobile phone, notebook, or any other Internet-enabled device. As a result, you are always connected and capable of creating or monitoring a delivery or managing any aspect of your local courier and messenger program.
Of course, technology is only as good as the people who control it. There are times when immediate human contact or intervention is necessary. For this reason your MMS account management team is a valuable source of expertise and insights that ensure your local courier and messenger program is based on industry best practices and achieves the best possible business outcomes, whether regularly scheduled or on-demand services are required or appropriate.
“A ‘never normal’ has arrived for e-commerce sales—and consequently, for post and parcel organizations,” writes Accenture Managing Director Brody Buhler. “Simply put, more packages need to be delivered. But while retailers have accelerated transformation, most post and parcel organizations have not. I see many new opportunities to catch up with the market and become ready to outmaneuver uncertainty. Seize this moment and you could take market share to set your business up for years of future growth.”
The team at MMS agrees whole-heartedly with Mr. Buhler’s summation. Your local courier and messenger program is more important than ever in continuously improving operational performance and satisfying the business outcomes your organization needs to succeed. After all, people are counting on you to get things right. Which is why you should count on MMS to get things there.
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Sources:
1Research and Markets: (https://www.researchandmarkets.com/r/p0cebn)
2Accenture: https://voicesfrompublicservice.accenture.com/unitedstates/how-covid-19-has-brought-delivery-into-the-future
3Retail Dive: https://www.retaildive.com/news/e-commerce-sales-spiked-nearly-93-in-may/579725/
4Accenture: https://www.accenture.com/us-en/insights/retail/coronavirus-consumer-behavior-research
5CBRE: https://www.cbre.us/research-and-reports/demand-continues-to-outpace-supply