Italy Courier, Express, and Parcel (CEP) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Italy Courier, Express, and Parcel (CEP) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The courier, express, and parcel (CEP) market in Italy is expected to witness a CAGR of more than 7% during the forecast period (2022-2027).

The Italian economy faced one of its darkest hours in modern history. After contracting by 5.4% Y-o-Y in the first quarter of 2020, the country's GDP shrank significantly in the second quarter. Arrivals at tourist accommodations were down 99% in April compared to 2019. In 2020, due to the COVID-19 restrictions, the B2C segment witnessed a positive impact, which is expected to continue for the coming few years. Although the pandemic has had a negative impact on many businesses, logistics and courier services have benefited. The limited mobility of the community has created an opportunity for courier and logistics companies in the country. Mobility constraints, as well as consumers' desire to avoid as much human contact as possible, have increased overall online shopping. Because online grocery shopping is still uncommon in Italy compared to other European markets, the sudden increase in demand has put a strain on the ability of local e-commerce platforms to fulfill orders.

Italy's economy is one of the largest in the European Union. Its economy is largely service and manufacturing-based. Over three-quarters of overall GDP is generated by the services sector, which employs roughly 65% of the country's workers. The service industry is primarily supported by wholesale, retail sales, e-commerce sales, and transportation. In terms of absolute value, Italy is the first beneficiary of the two main NGEU (Next Generation European Union Plan) instruments, the Recovery, Resilience Facility (RRF) and the Recovery Assistance for Cohesion and European Territories (REACT-EU). The sole RRF allots EUR 191.5 billion in resources to be used between 2021 and 2026, with 68.9 billion in non-refundable grants. Italy also plans to fully utilize its own funding capability through the RRF loans, which are expected to be worth EUR 122.6 billion.

• In 2020, Italy's transport and storage sector turnover declined by 17.5%, or 4.6% points more than the average of the 27 EU countries (12.9%), resulting in a EUR 28.8 billion gap. While the e-commerce boom (+34.5% of sales) did not proceed with the same intensity in the 'last mile' of deliveries, it halted at +4.4% when examining the turnover of postal and courier services providers. Amazon invested EUR 350 million in Italy, which will result in the creation of 3,000 new employees across the country. By the end of 2021, 3,000 additional permanent employees were to be benefitted. E-commerce shipments increased by +103% during the lockdown and by 68.5% post lockdown, demonstrating that the trend isn't going away. Supply chain and logistics operators had to deal with large volumes of work related to B2C deliveries and growing expectations from consumers throughout 2020, taking into account the incremental security measures relinquished. The parcel volumes in Italy have witnessed a boom in the last few years due to the rapidly expanding e-commerce business in the country and the strong cross-border deliveries. The market studied has witnessed a growth in logistics startups mainly catering to parcel delivery. This includes companies such as Moovenda, Qapla, PonyZero, SiWeGO, FAST (Freight Advanced Service Technology), and Sendabox.

The market has experienced tremendous growth even during covid-19 as the internet retail sector experienced a boom. With increasing internet penetration in Italy and social distancing norms, the population prefers to order online, and even food delivery services have experienced a growth in demand.

Parcels markets across Europe continued to be helped by stronger economic performance across the continent. Known as one of the major export countries in the world, Italy is also the eighth-largest economy in the world and the fourth largest in Europe. A key factor driving the growth of the market studied has been the growth of internet retail. This has acted both as a driver of volumes and also of innovations, such as defined timeslots, the ability to make changes to deliveries, a broader range of communication methods, and the establishment of parcel shops and parcel lockers as pick up/drop-off locations. People in Italy spent approximately EUR 549 during the peak season in 2020, making them one of the biggest spenders in Europe, where the estimated average expenditure is EUR 461. Italy is among the top three countries with the highest estimated holiday spending, together with the United Kingdom and Spain. With e-commerce growing during the pandemic, the sector suffered a minimum impact as compared to other sectors.

• The preferred device for online shopping in Italy is a desktop computer. Online purchases are finalized via. desktop accounts for 56% of the total online purchases, while smartphones and tablets account for 39% and 5%, respectively. However, despite desktop devices still being preferred for online shopping, mobile devices have been catching up fast. Moreover, the number of e-commerce users has been on the rise for the past few years. The share of the population aged six years and older using the internet in Italy exceeded 74.3% in 2021, increasing twofold since 2006. Moreover, e-commerce users in Italy were approximately 35 million in 2021 and are expected to reach 40 million by 2027.

While parcel volumes keep rising, carriers have been racing to keep up with competition and with consumer demand, delivering innovative new customer experiences, digitalizing technologies, and investing in infrastructure, all while generating sustainable revenues. With the growing parcel delivery market, many start-ups have entered the market studied in the past few years. Many companies have been using automation and blockchain technologies to streamline their supply chain and delivery process. RFID tracking and delivery time scheduling by customers and some of the newer initiatives in the market. The last mile parcel delivery growth is another factor for growth in parcel volumes. Due to the increasing partnerships and technological upgrades, the customers have experienced faster delivery times, hence, preferring private parcel company delivery services to traditional postal operator delivery services.

The market for CEP in Italy is moderately fragmented, with a number of national and international players. International players are making strategic investments, such as the creation of new distribution centers and smart warehouses, to develop a regional logistics network. Local businesses compete fiercely with foreign corporations that benefit from a more established infrastructure. BRT, DHL, Post Italiane, FedEx, UPS, and GLS are the key players in the Italian CEP market. Post Italiane is the most used by Italians for parcel deliveries. The company has been developed recently. It is partnering with tech companies and implementing them to improve the supply chain.

The demand in the CEP market was majorly due to the tremendous growth in e-commerce, which laid an opportunity for the companies to capture the market. Companies started to invest in technology, which helps them in the retention of customers. The new trends, like same-day delivery, made companies across Italy apply new strategies and update their supply chains.

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support