A European Union perspective on parcel delivery in the e-commerce age
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1 A European Union perspective on parcel delivery in the e-commerce age Asia-Pacific Forum on e-commerce & Sustainable Logistics Bangkok, November 2013 Martin Schraa Cullen International
2 Cullen international Regulation made simple Brussels-based 25 years Monitoring, reporting, benchmarking of regulatory developments in multiple sectors Mainly Europe + LatAm, MENA 140 clients
3 Outline The European e-commerce market Obstacles for cross-border parcel delivery Possible solutions
4 The European Union: a huge opportunity 28 member states working on a single market for trade and services 507m people 2012 GDP: 12,945bn Contribution of the internet economy to GDP growth ( ): 21%
5 but potential not yet realised Internet economy still a small part of EU GDP: 3% (2010) Only 3.4% of European retail trade E-commerce growing mainly at national level, varies per country Cross-border e-commerce remains low: in 2012, 70% of online shoppers did not buy crossborder
6 What is keeping Europeans from cross-border shopping online?
7 Parcel delivery main reason for abandoning e-shopping cart 60% 50% 40% 49% 30% 24% 20% 10% 6% 8% 8% 11% 0% No Track 'n Trace No convenient delivery options No delivery by my preferred operator Lack of information Too long delivery time Too high delivery price Source: Copenhagen Economics study E-commerce and delivery' for the European Commission (2013)
8 European Commission Green Paper on cross-border B2C parcel delivery Published in Nov Explores main problems and possible solutions Focus on voluntary solutions instead of legislation Roadmap on the way forward: published November 2013
9 Green paper: universal service (US) not tailored to e-commerce B2C parcels covered by the US 5-10% Few low-cost options for small packets under 2 kg Premium services, e.g. track and trace are expensive In particular for small retailers (23% of cross-border deliveries) Other options are only slowly emerging: parcel kiosks, relay points Demand for tailor-made packet delivery options with simple tracking at affordable prices is currently not being met
10 Green paper: consumer demands and retailer challenges Consumers want: Retailers need: Affordable price Free or low-cost delivery and return A more competitive market More players, offers and options Transparency Real time information about their order Flexible delivery times Flexible delivery options and capacity E.g. during peak periods Transparency and control E.g. common performance indicators
11 Green paper: challenges for delivery operators High fixed costs Demand for low tariffs and new services by large retailers Lack of integration along the transport and logistics chain
12 Solutions considered After nearly one year of discussions... Aims are clear... More convenience Lower costs Greater interoperability...with a light touch approach Legal intervention Industry solutions and cooperation
13 Transparency Information about: Delivery options Prices Service levels Time and date of delivery Performance and quality Convenience Costs Interoperability
14 Lower prices by reducing costs More success at first delivery Other delivery modes: e.g. parcel kiosks, relay stations Convenience Costs Interoperability
15 Cross-border track and trace solutions European standards? Open application interfaces? Convenience Costs Interoperability
16 Interconnected platforms E-Parcel Group (EPG): Integrated delivery system of priority parcels of 31 national postal operators Increasingly for B2C Track and trace, automated customer service system Coordinated by the International Post Corporation (IPC) Similar approach for returning e- parcels (22 operators) Convenience Costs Interoperability
17 Conclusions Cross-border EU e-commerce suffers from the lack of an integrated parcel delivery market Solutions are, for the moment, to be based on industry cooperation Among the main areas for improvement: transparency, common track and trace system, platform cooperation
18 For further developments, go to
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