Courier business thrives on the back of booming e-commerce

Friday, October 11th, 2019 00:00 |
E-Commerce. Photo//cOURTESY

Why walk to the shop to buy groceries, food or shoes when you can shop for the same via phone and have them delivered at your doorstep? 

It is a question many Kenyans ask these days before choosing the convenient option that has seen a boom in e-commerce.

Medicines, groceries, meals, shopping and electronic items, among others, are just a click away. 

While e-commerce service providers, that include telecommunication firms, supermarkets, restaurants, grocery stores and fast-food chains, are some of the beneficiaries of the trade, the biggest winners are courier services. 

Kenya is experiencing a surge in courier service providers supported by booming e-commerce as Internet use hits a new high. 

Communication Authority of Kenya (CA) says the growth of courier business is currently hinged on e-commerce. 

As of June, there were 1,027 courier service providers, with the number rising by a record 30 from 997 in a similar quarter in 2018. The 1,027 courier service providers during the period moved 885,862 parcels and courier items, a growth from 724,866 in the period ending March. 

Parcel delivery

“The rise is mainly attributed to increased uptake of e-commerce in the country especially by micro, small and middle-sized enterprises,” said CA.

Courier service providers include leading bus companies, the postal corporation, independent firms that mainly use motorbikes for short-distance deliveries, media houses and security companies. 

A survey at various leading bus companies shows parcel delivery is among their most popular business. 

At Easy Coach, dozens of parcels were being sorted for delivery to various western Kenya destinations on Tuesday.

“We move hundreds of courier items every day, big and small,” said an attendant, with the company charging a minimum of Sh300 for each item. 

It was a similar case at Modern Coast Bus Company in downtown Nairobi, which also ferries tens of parcels every day to various coastal towns.

Among items ferried by the long-distance bus companies include electronic equipment like computers and TVs, medicines, clothes, foodstuffs and motor vehicle spare parts bought by small businesses upcountry.

“There is good business in rural areas. I have several customers there. They tell me the machines they want, I share photos of what I have via WhatsApp, we agree on the price, they pay via mobile money and I send the items via courier,” offered Gilbert Ojiambo, a computer seller in Nairobi. 

Besides bus companies, cab hailing firms such as Uber and Bolt are among the latest entrants in the courier business as they seek to cash in on the rise in-home delivery services, especially in Nairobi.

Technological innovations

Courier Industry Association chairman Geoffrey Mwove, in a recent interview, said e-commerce is the current growth driver of the industry, with firms leveraging on technology to enhance efficiency and lower costs. 

Kenya was ranked seven out of 10 e-commerce developing economies in sub-Saharan Africa in 2018 by the UN Conference on Trade and Development. 

The agency put the number of online shoppers at about 2.6 million, with the country trailing leader South Africa which had more than three million. -Xinhua

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