Express Delivery Services

Express Delivery Services

Brief Excerpt from Industry Overview Chapter:

Companies in this industry provide express delivery and pickup of parcels. Major companies include US-based FedEx and UPS; as well as Aramex (United Arab Emirates); DHL (Germany); and Yamato Transport (Japan).

COMPETITIVE LANDSCAPE

Demand is driven by business transactions and online consumer spending. The profitability of individual companies depends on price, reliability, quality, and services. Large companies compete by offering a wide range of services. Small companies compete through specialized customer service. The industry is divided into two segments: large networked couriers capable of nationwide and international delivery, and smaller local services that transport packages within a metropolitan area. The courier segment of the US industry is highly concentrated with the top 50 companies accounting for about 95% of the industry's revenue; United Parcel Service (UPS) and Federal Express (FedEx) dominate the market. The local segment, which is much smaller, is fragmented with the top 50 companies accounting for about 45% of the industry revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

The express delivery primarily industry transports small parcels handled by a single delivery person without the use of special equipment. This differentiates the segment from the freight shipping industry, which handles high volumes of large cargo and requires heavy, specialized equipment. Express delivery and pickup of parcels may be local, intercity, or international depending on the company's capabilities. The largest companies in the industry, which operate extensive networks that allow door-to-door service, are called integrators.