South Korea’s parcel delivery is set to continue decent growth this year following last year’s stellar performance on the back of a rising demand in online shopping, but tougher competition for fast delivery may eat into operators’ profitability, industry data showed Friday.
The volume of parcel services jumped 10.6 percent on-year to 1.81 billion boxes in 2015, and combined sales rose 8.5 percent to 4.34 trillion won ($3.59 billion), the Korea Integrated Logistics Association said.
E-commerce has driven huge growth in the business-to-customer parcel market as consumers are now demanding fast delivery services for their online orders and convenient methods of collecting their parcels.
The Middle East respiratory syndrome outbreak in late May of last year accelerated the growth as many people turned to online channels for grocery shopping.
Despite the rapid growth, maintaining profitability remains a key challenge for parcel delivery operators in the intensely competitive market.