Andrew Lester & Associates has just delivered the first of four sets of research findings on the UK parcels and packets market in 2002.
The PacTrac Programme is a continuous market monitoring study that reports quarterly on parcel and packet shipments, carriers used and types of service levels required.
Wave 1 results are based on telephone interviews with 500 UK shippers during the March-May period. This will be repeated over three further quarters, until 2,000 interviews have been conducted and a detailed picture of the marketplace can be set out. Although data is captured about both international and domestic parcel usage patterns, the study focuses on the needs of international shippers, to the exclusion of domestic-only shippers.
The top carriers used for international parcels and packets (in volume terms) predictably comprised the major integrators and UK Post Office operators. These six carriers accounted for 71% of international parcels and packets shipped by the 500 users interviewed.
Sixty percent of our respondents only used one carrier for their international shipments and nearly 30% used two different international carriers. In terms of number of accounts, DHL held the lion’s share (45%), followed by TNT and UPS with nearly a quarter of those interviewed using them. Royal Mail and Parcelforce brands shared 8% of usage mentions.
The majority (95%) of those interviewed were able to tell us about domestic shipments. Just over three-quarters of these sent 50% or more of their total parcel shipments nationally. Interestingly, the majority of the international postal service users (88%) stayed with their main international carrier for domestic despatches. This compared with just over a third of TNT international customers, 25% of UPS users and 20% of DHL users also using their international carriers’ domestic delivery services. The dominance of these players is also evident in terms of volume shares of parcels and packets sent nationally.
Those carriers with more than a one- percent share of international despatches accounted for nearly half the domestic parcels sent by most of our respondents.
However, the domestic parcels market is very fragmented – with fourteen carriers accounting for two percent or more of the total volume. This compares with six carriers in the international sector.
They asked shippers where their top five destinations were for parcels and packets during the March-May period. The United States accounted for the largest share of items (24% of total international volume), followed by France and Germany (12% each), Italy (6% and then Belgium (2%).
More carriers seem to be competing for French destinations – with “Other” carriers accounting for 40% of parcels to France. DHL was found to be 10 points down on its total international share for France and Belgium. Parcelforce had a slightly higher share to Germany and Italy (compared to its overall average). As would be expected, the US was a strongpoint for FedEx. By contrast, TNT, with its Benelux links, took the largest single share (nearly 30%) of items to Belgium, with Germany its next most important destination.
The study profiled preferred transit times by major destination (for seven different delivery categories). Interestingly, shippers to Italy showed the greatest sense of urgency - over half said they needed their parcels to be delivered by next day close of business or earlier. This compared with more relaxed expectations to Belgium – nearly 60% items were booked on a 48 - 72 hours’ delivery service.
Information was also collected about average parcel and packet weights, typical prices customers expected to pay for specific shipments, and customer loyalty. For instance, only 4% of international shippers we talked to had changed parcel carrier in the previous six months. However, 9% were considering a switch in the near future.
PacTrac monitors price changes recorded by customers by carrier, transit time and destination. For example, in the previous 12 months, the lowest incidence of price increases for international despatches was registered among Parcelforce customers, whilst TNT users reported the lowest rate of price increases. Actual price levels, price changes and anticipated pricing changes will continue to be tracked over the coming months, and resulting trends will be fully analysed once a full year’s data has been collected.
As part of a series of ad-hoc questions, Andrew Lester & Associates also asked parcel service users which international carrier had the best reputation for quality of service. The chart above shows the percentage of users that rated that carrier the “best” for quality of service, and makes the point that market share size is not everything. (NB Eighty percent of respondents answered this question).
The PacTrac survey programme allows subscribers to include their own private questions. The results are then delivered in the form of simple analysis together with a complete response data-set, so that subscribers can perform prospect customer selections by usage profile
