Courier Services Industry Analysis Assignment

Added on - 13 Nov 2020

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COURIER SERVICES INDUSTRY ANALYSIS1.0INTRODUCTIONThis chapter aims to provide an in-depth industry analysis of courier operators in Ghana, theirindustry size, growth rates and sales projections over the years, industry structure, nature ofparticipants, industry trends, key success factors and assess the industry’s attractiveness usingPorter’s five forces model.1.1.INDUSTRY SIZEIn Ghana, the number of registered courier operators by the Postal and Courier ServicesRegulatory commission in 2020 totaled fifty-One(51). There are five (5) large registeredcourier service operators, five(5) medium size registered service providers, twenty-nine(29)small registered courier firms and only One(1) national postal service provider(http:/pcsrc.gov.gh).1.2.GROWTH RATEThere is high growth rate in this industry. The major industry players, FedEx, DHL, UPSaccount for 60% of the industry’s revenue. Their growth rate for the year 2020 are as follows;DHL 3.1%, UPS 5.5% and FedEx 4.1% (IBISWorld.Global Courier & Delivery ServicesMarket Size2005–2026).1.3.SALES PROJECTIONThe estimated sales projection for 2020-2021 of DHL is €3.8billion, FedEx $40.0billion andUPS is $899.7million (Globenewswire.Global Data Center UPS Market Report, 2020).
1.4INDUSTRY STRUCTUREThe Courier and Delivery services industry is highly concentrated with larger and smallerfirms. Key players in this industryinclude FedEx Corporation, SF Express (Group) Co. Ltd.,Deutsche Post DHL Group, United Parcel Service Inc.These companies have adopted severalstrategies such as product launches, partnerships, collaborations, mergers & acquisitions, andjoint ventures to maintaintheir foothold in the market. This makes the industry highlyprofitable for existing firms and new businesses.1.5NATURE OF PARTICIPANTSThe nature of participants in the industry are innovative.They arerecognized fortheirtracking features, speed, security,andtransportation mode. They usesoftware services toprovide electronic tracking details and electronic proof of delivery.In Ghana, the digitaladdress system is used by both smaller and larger courier firms to provide real-time trackingof order and easier identification of locations. These innovative features used by courieroperators in Ghana makes the industry attractive and generates higher profits for firms.
1.6INDUSTRY TRENDSThe demand forCourier serviceoperators isbooming around the world. Technologicalinnovation incourierserviceis making the headlines, and the market is becoming highlycompetitive. Digitally-connected customers are believers of instant gratification, ease-of-use,and seamlessness.Surge in demand from e-commerceindustry has boosted theglobal courier service market.1.7KEY SUCCESS FACTORSTechnology and communication:The useoftracking devices on allorders helpscustomerstofind out where theirorderis and at what time they are going to receive it.Management- Human Resources isa very critical success factor since physical laboris needed to drivevehicles, to load and offload, and other labor intensive activitiesrelevant to the courier industry. Better pay salaries and benefit packages must begiven to workers.Prices or rates-Successful courierserviceproviders must find the right price tomaintain customers and give agoodreturn of investment.Quality of Service-offering customers a quick, effective, flexible andtimelyservicedesigned to give maximum comfort to the recipient.Strong leadership:For a successfulbusinessgood leadership, dedicationandcommitmentis important.Expansion of e-business:Thebusinessshould find online shopping companies tocontract delivery of their products. Now the growth of e-commerce is very fast. Thebusinesscan enjoy both profit and brand name from this kind of expansion.Safety- Good storage facilities, insured and licensed drivers and motorcycles,compensation policies for damaged goods must be provided to maintain customersconfidence and loyalty to the business
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