The CEP sector

From the "Hidden Champion" to the success story of digital commerce

"CEP" stands for "Courier - Express - Parcel" - and thus for a highly specialised industry within logistics. The three divisions differ from one another (see document: C-E-P - what is what?). The parcel division, to which GLS belongs, originated from the requirement of companies, among other things, for customisable and yet cost-effective transport solutions for small consignments instead of general cargo (see document History: From a postal monopoly to modern parcel shipping]).

Today, the growth of the CEP sector - measured from 2000 to 2017 - is the highest of all sectors, including the logistics sector as a whole [1]. According to the industry association BIEK, the volume of shipments in the German CEP market rose by 5.9 percent in the first half of 2018 alone. The growth in parcel shipments is outstanding, with an increase of 6.0%. However, express and courier shipments also increased significantly by 5.4% in the first half of the year. This corresponds to more than 500,000 shipments per day. All in all, BIEK is expecting annual volume growth of 5.2 percent until 2022.

Growth engine online trade

The ongoing boom has a clearly identifiable cause: the success of e-commerce. This is driven by the increased use of the internet and internet-capable mobile devices in public life, business and private life.

The CEP sector represents the backbone of successful online trade. Because ordered goods should of course be delivered as quickly, conveniently and traceably as possible. And - if an item is not to one's taste - to return it.

In this context, the industry not only has to process the rapidly growing parcel volumes and meet the demand for European and worldwide door-to-door delivery. In the service for most online retailers, it also faces changing conditions among the recipients: private individuals - in contrary to B2B recipients - are not at home at certain times and usually only receive individual parcels.

Parcel services therefore rely on prompt information and communication to ensure before the first delivery attempt that they can deliver the parcel. The ParcelShops have now taken on a special significance in this context.

The boom also brings completely new challenges for the industry. More and more frequently it is accused of being partly responsible for traffic jams and increased fine dust pollution in the city centres. In fact, according to BIEK, the industry operates just 0.3 percent of the total vehicle population in Germany. Nevertheless, the industry is driving the development of alternative vehicles - among other things with its own innovations. In terms of sustainability, GLS is examining and testing numerous approaches for low-emission inner city delivery.

[1] Cf. BIEK KEP Study 2018, page 23


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