30 November 2022

The cost increase in the courier service industry – our opinion

The cost increase in the courier service industry – our opinion

 

The consequences of the pandemic, the energy crisis, the war in Ukraine, and other factors affect various industries. Everything is getting more expensive, mostly due to rising prices of electricity, gas, and fuel. It can also be noticed that courier services are becoming rather costly. Find out, what the situation is and what is our opinion on this matter!

Freight forwarders are increasing the prices of services

Sanctions against Russia, which is one of the largest suppliers of fuel raw materials, have led to increases in electricity and fuel prices. Oil has already been expensive for a long time, so it’s no wonder that transportation-based services are becoming increasingly expensive.

Courier companies are trying to adapt to the current situation, trying to maintain the highest standard of provided services. For example, in October this year, DPD introduced an additional variable energy fee to be charged starting November 1. The rate for November is PLN 0.25 net and will be updated monthly.

 

Container freight rates for October 2022 according to the Freightos Baltic Index.

 

The near future of the courier service industry – what can we expect?

Rising energy costs are one of the key factors contributing to inflation. In September, the increase in the prices of consumer goods and services averaged 17.2 percent. The inflation peak is forecast for the first quarter of 2023. Consumers looking to save money may forgo delivery expenses en masse, which will stunt the growth of the KEP (courier, express, postal) market.

The Belgian Road Transport and Logistics Institute (ITLB) predicts an increase in the cost of courier services by approx. 13 percent. For now, consumers and e-commerce entrepreneurs must be ready for higher prices, because unfortunately, it is simply difficult to avoid. The situation on the market will stabilize over time, so all we can do is patiently wait.

How to send parcels cheaply in the face of a crisis?

Suppliers who use non-standard forms of delivery, such as parcel lockers, are becoming increasingly popular. Thanks to these solutions, they can significantly reduce the costs associated with delivering packages to recipients – the courier leaves the parcels in one place. However, it should be noted that DPD, InPost, SwipBox and other service providers using this technology also face higher costs of doing business.

An interesting solution is also the use of logistics intermediaries who help to find the cheapest method of shipping from the available options.