Changing Consumer Preference towards Online Shopping, Increasing Cross-Border E-Commerce Trade, Government Initiatives and Collaboration with Private Players Expected to Drive the UAE CEP Market: Ken Research

Key Findings

Aramex, a leading express company, recently announced adopting a new operating model with the strategic objective of enhancing customer service levels and operating efficiencies while capturing greater global market share. Aramex Express will serve the B2C customer base including Shop & Ship, e-commerce, FMCG, SMEs and other customers needing innovative last mile solutions.

Emirates Post has announced 5 new services to its business services portfolio, to enhance customer experience, improve efficiency, offer more flexible pick-up and drop-off options, and faster delivery services. New additions include new service points and parcel lockers, temperature-controlled vehicles for its cold chain solutions, new fulfilment centre in Dubai South and same day express service.

Technological developments vis-à-vis API integration into postal websites, Live Tracking of Shipments, Barcoding, Collaboration between different entities in the market GPS Monitored Robots, Drones, Inbuilt RFID, GPS, IoT, telematics for better inventory management is expected to help in the growth of the market.

Way Forward for Express Delivery Market in UAE: The country seems to be in a perfect position to benefit from the geographical location of the country as a strategic trade hub between three continents. The CEP market is expected to grow at a CAGR of 14.0% in terms of revenue during 2020-2025. With the introduction of new technologies and the backing of the government to increase the efficiency of deliveries, the country seems to be in a great position to benefit from the CEP market.

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Moreover, government initiatives focusing on reducing lead time, provision of value added services and organizing events such as Expo 2020 are expected to fuel the CEP deliveries. Introduction of FTZ & SEZ zones would attract more manufacturing industries in the country.

The CEP space is formalised by the UAE government as it provides licences to the Courier companies for operation and the granting of licensing to start the operations are based on certain parameters. Furthermore, businesses in this space have been encouraged to upgrade technologically and even bring SMEs into the fold.

AE Express Delivery Market Competition

E-Commerce Surge and Use of Sophisticated Technologies Expected to drive the market further: In the past few years, UAE has managed to position itself as one of the fastest-growing E-commerce markets in the world which fares well for the express delivery companies. The growth of E-Commerce and digital payments presents a huge opportunity for companies in the Express Delivery space as only 38% of payments for shipments have been conducted through plastic money. The opening up of logistic hubs has expedited the delivery of shipments to their destinations. Additionally last mile deliveries are expected to become even more efficient with companies focusing on new models such as “click and collect” locations. The use of technologies such as GPS Monitored Robots, Drones, Inbuilt RFID, GPS, IoT, telematics is expected to make inventory management more cost-efficient for the companies.

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Long Term Positive Impact of Covid-19: The sudden onset of the pandemic has essentially interrupted and unsettled social and economic activities worldwide. Initially, while the logistics sector as a whole has been affected by global trade slowdown, the sub-sectors like international CEP have witnessed steady growth when compared to others such as freight forwarding, inventory and supply chain management. Consumers moved to online shopping for clothes, groceries and other items which they would usually purchase from brick-and-mortar shops, leading to a surge in B2C shipments. Moreover, this is corroborated by the fact that lockdowns have made inter-country travel difficult, and due to the high population of expatriates living in the country, deliveries during the festive seasons and other important occasions has led to an increase in the number of express shipments. Thus, growth in the volume of shipments was witnessed during festive periods. This has led to the clear establishment of more trade lanes and information about new companies for the players in the Express Delivery Market. Companies are continuously investing on technologies to make deliveries more efficient and customized according to the demands of the customer. This trend is only expected to continue in the coming years.

Analysts at Ken Research in their latest publication “UAE CEP Market Outlook to 2025 – By Domestic and International Express, By Mode (Ground & Air Express), By Business Model (B2C, B2B & C2C), By Shipment Weight (5kg), By Region (Dubai, Abu Dhabi, Sharjah & Others)” have observed that the CEP market in UAE has a great potential to grow supported by increased E-Commerce Demand in the country. The covid-19 outbreak has further accentuated the growth of the market by shifting major retailers to online platforms affecting consumer preference concerning online retail. UAE CEP Market is expected to grow at a CAGR of ~14.0 % based on the revenue over the forecast period 2020-2025.

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Key Segments Covered

By Domestic and International Express
Domestic Express
International Express
By Mode of Transport
Ground Express
Air Express
By Major Regions
Dubai
Abu Dhabi
Sharjah & Others
By Business Model
B2C
B2B
C2C
By Shipment Weight
5 Kg
By Delivery Period
Same Day Delivery
1-2 Day Delivery
More than 2 Day Delivery
CEP Companies Covered

Aramex
Emirates Post
SMSA Express
DHL Express
FedEx
UPS
Team Express Services
First Flight Couriers
TFM Express
Sky Express
Zajel Courier Services
Century Express
Cross-Comparison on GCC Postal Networks Covered

Oman Post
Bahrain Post
Saudi Post
Qatar Post
Emirates Post
Key Target Audience

CEP Companies
Express Delivery Companies
3PL Logistics Companies
Postal Network Association
E-Commerce Companies/Platforms
Integrated Logistics Companies
Logistics/Supply Chain Industry Associations
Parcel and Mail Companies
Ministry of Transport and Communications
Time Period Captured in the Report: –

Historical Period – 2015-2020
Forecast Period – 2020-2025F
Key Topics Covered in the Report

UAE CEP Market Overview
UAE Domestic/International Courier Delivery Market
Industry Lifecycle of UAE CEP Market
UAE CEP Market Ecosystem
Timeline of Major CEP Players
Delivery Model in CEP Market
UAE CEP Market Sizing Analysis, 2015-2020
Seasonality Trends in CEP Market
Growth Drivers for UAE CEP Market
UAE CEP Market Segmentation, 2020
Competition Scenario amongst Players in UAE
Market Share of Leading Players in the Overall UAE CEP Market
Market Share of Leading International and Domestic Players
Competition Parameters in UAE CEP Market
Cross Comparison of Major UAE CEP Players
UAE CEP Market Pricing Analysis
Laws and Regulations Governing CEP Market in UAE
Issues and Challenges Faced by CEP Players
SWOT Analysis of CEP Market in UAE
New Trends and Developments in the UAE CEP Market
Customer Analysis for the UAE CEP Market
Future Market Size and Segmentations, 2020-2025F
Covid-19 Impact on UAE CEP Market
Analyst Recommendations
Cross-Comparison of GCC Postal Networks

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