UK Two Man Home Delivery Market Insight Report 2018

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Published: September 2018
Pages: 69
Format: PDF Download

 

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Description

About the report

The report provides an analysis of the UK two-man home delivery market. It quantifies the market size, historical growth rates and levels of industry profitability. It also includes an in-depth analysis of the relevant drivers of industry growth setting out historical trends and available forecasts. It profiles the leading UK providers of two-man home delivery services. Our forecast for industry growth is based on this analysis of historical trends and growth drivers.

The 2018 version has been fully research and updated. It includes a new section identifying the 2-man delivery providers used by each of the Top 500 UK online retailers with relevant requirements.

 

What are the sources and methodology?

This report is based on
– Interviews with senior-level contacts in the consumer credit industry
– Extensive research into published industry sources
– In-depth analysis of the macroeconomic environment and relevant market drivers
– Financial analysis of the accounts of companies in the industry

We have used assumptions to build the estimated market data contained within the report. We have used third-party market estimates of key product segments applicable to two-man home delivery, eg washing machines, tumble dryers, fridge freezers, sofas, dining room tables, bed frames, divans and mattresses.

We have not included brown goods in our definition of the market as most brown goods, other than very large televisions, would be delivered by standard courier.

We have used assumptions about average cost of delivery for certain product categories, as well as average cost of assembly and connection for certain items. We have also made assumptions about average cost of disposal on a per product category basis. Further, we have made assumptions about the likely consumer take-up of these services on a per product category basis.

These assumptions have been updated and refined since our last two man delivery report. Using research on live pricing of delivery, disposal, connection and installation; as well as updating our estimates of uptake of delivery, installation and disposal, our market value figures have been revised upwards.

The data was cross-referenced against revenues of specialist two-man home delivery companies, volumes for specific two-man delivery contracts and other anecdotal information to refine our market estimates.

 

Who is it useful for?

The report is intended for:
– Providers of two-man home delivery services; and other home delivery services
– Retailers and online retailers of large ticket items, such as large domestic appliances and large items of domestic furniture.
– Investors in these businesses
– Banks, analysts, consultants and other parties with interests in the sector
– Market regulators and policy makers

Market background

A two man home delivery service typically involves a driver and mate delivering large, bulky or specialist items, often involving assembly, installation, fitting and removal of packaging and old items.

This report focuses on deliveries to customers’ homes. Although there is a business-to-business two-man delivery segment which focuses on items such as medical equipment, ATMs, commercial kitchen equipment and large computers, it is much smaller than consumer two-man delivery and has lower growth. The latter segment is not included in this report.

The two man home delivery market includes deliveries of large items including mattresses, beds, bed frames, wardrobes, flat pack items, large domestic appliances (fridge freezers, washing machines, tumble dryers and ovens), kitchens and other household items such as fitness equipment or large garden items.

The market comprises three main activities:
– delivery
– assembly / connection
– disposal.

We believe that the UK market was over £850m in value in 2017, growing in line with UK retail demand for large items. This value includes both in-house and outsourced deliveries.

In recent years the market has been impacted by changes in supply chains, which have seen a move away from the old model of distribution of items via store networks towards regional and national networks which may be operated by a retailer or, in some cases, by the OEM with the retailer never taking possession of the physical items.

There have also improvements in customer service and the efficiency of customer communications, driven by systems innovations, and designed to ensure first time / no-fault delivery

Market drivers

The market is driven by a range of factors including:
– sales of larger items requiring two men to deliver, assemble or fit the items (typically furniture, large domestic appliances, garden furniture, home gym equipment, etc.)
– the volume of residential housing transactions, given that people are most likely to buy big items after moving house.
– factors which influence overall retail sales, such as consumer confidence
– the offer and take up by customers of premium services, such as next day delivery and installation, assembly and disposal services
– regulations regarding the recycling and disposal of items that are taken away from customer premises which have made consumers more likely to pay extra for disposal

Competitive landscape

Some manufacturers and retailers outsource their two-man home delivery operations and others choose to maintain in-house capability (e.g. Argos, John Lewis, Currys). We segment the market between:
– Larger third party two-man delivery service providers, such as ArrowXL, Expert Logistics, Wincanton, CEVA Logistics, Panther Warehousing, DX Group, Breezemount, Panther Warehousing, DSV Solutions, BJS Distribution and DHD Direct
– In-house delivery operations of large retailers – such as John Lewis, Currys and Argos – which have the scale to run their own national two-man delivery operations efficiently
– Smaller two-man delivery service providers
– Smaller retailers carrying out their own deliveries or using a local transport partner.

We believe that the majority of the market is still carried out in house but that the outsourced segment has grown more quickly as, in particular, medium-sized retailers, have outsourced their operations.

Operating margins vary, with the highest at 14.2%, and the lowest at 3.3%. Aggregate industry margins have improved since we reviewed the market in 2016.

 

Outlook

We expect the market to continue to grow, driven by
– On-going demand for the purchase, connection, assembly, installation and disposal of large items.
– Further increases in penetration of value-added services such as installation and collection / refurbishment / recycling of old equipment.
– Supply chain trends present further opportunity for providers as both retailers and OEMs look to modernise and streamline their processes by using an external delivery specialist.
– Increasingly the trend is for offline businesses to follow the pattern of online retailers with physical items being distributed direct from the OEM to the consumer, rather than going via a regional / local store network.

There is uncertainty given the Brexit referendum and the impact it has had on consumer confidence and prospects for retail sales – in particular for larger-ticket, more discretionary purchases, and the housing market. Our forecast assumes an orderly Brexit.


    To talk to us directly about the report, or to ask a specific question, please telephone: +44 20 7100 7239


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    About this report 2
    What does the report contain? 2
    Who is it useful for? 2
    What are the sources and methodology? 2
    Summary 3
    Market background 3
    Market drivers 3
    Competitive landscape 3
    Outlook 4
    About Apex Insight: 2018-19 Parcels & Logistics Research Programme – highlights 5
    About Apex Insight: recent parcels, transport and logistics consulting experience 6
    About Apex Insight: example parcels / delivery research and consulting clients 7
    Contents 8
    List of charts and tables 11
    About the Market 12
    Two-man Delivery Market 12
    Definitions 12
    Market Trends and Characteristics 13
    Meeting Customer Expectations 13
    Home Delivery Software Management 13
    Removal and Disposal 13
    The Recycling Group Limited 14
    The Furniture Recycling Group Limited 14
    Connection / Assembly 14
    Deliveries & Dwell Time 18
    Increasing Online Sales of Big Ticket Items 18
    Driver Recruitment 19
    Supply chain trends 19
    Market Size and Growth 20
    Two-man Home Delivery Market Size and Growth 20
    Two-man Delivery Market Size by Segment 21
    Two-man Delivery Market Volume by Product Category (Delivery Volumes) 22
    Two-man Delivery Market Value by Product Category (Delivery Segment) 23
    Two-man Delivery Connection / Assembly Market Value by Product Category 23
    Two-man Delivery Disposal / Recycling Market Value by Product Category 24
    Two-man Delivery Market Forecasts 25
    Two-man Delivery Market Forecast by Segment 25
    Two-man Delivery Market Volume Forecast by Product Category 26
    Two-man Delivery Market Forecast by Product Category 26
    Two-man Delivery Connection / Assembly Market Forecast by Product Category 27
    Two-man Delivery Disposal Market Forecast by Product Category 27
    Market Drivers 28
    Retail sales 28
    Internet retail 29
    Shopping Trends in Big Ticket Items 30
    UK Housing Transactions 32
    Consumer confidence 33
    Competitive Landscape 34
    In-house vs. outsourced provision 34
    Outsourcing trends 34
    Leading outsourced providers 35
    UK Two-man Home Delivery Revenues 36
    UK Two-man Delivery Profitability 36
    Two-man delivery customer relationships 38
    Two-man delivery service providers used by top UK online retailers 38
    Historical Two Man Delivery Contract Awards 39
    Company Profiles 43
    Panther Warehousing 43
    Description 43
    History 43
    Financials 44
    Key Clients 44
    News 45
    Wincanton 47
    Description 47
    History 47
    Financials 47
    Key Clients 47
    News 48
    Expert Logistics 49
    Description 49
    History 49
    Financials 50
    Key Clients 51
    CEVA Logistics 52
    Description 52
    History 52
    Financials 52
    Key Clients 52
    News 53
    ArrowXL 54
    Description 54
    History 54
    Financials 55
    Key Clients 55
    News 56
    DX Group 57
    Description 57
    History 57
    Financials 57
    Key Clients 58
    News 58
    Breezemount 60
    Description 60
    History 60
    Financials 60
    Key Clients 61
    News 61
    BJS Distribution 62
    Description 62
    History 62
    Financials 62
    Key Clients 62
    DHD Direct 63
    Description 63
    History 63
    Financials 63
    Key Clients 63
    DSV Solutions 64
    Description 64
    History 64
    Financials 64
    Key Clients 64
    XPO Specialist Services (Norbert Dentressangle) 65
    Description 65
    History 65
    Financials 65
    Key Clients 65
    News 65
    Rhenus Logistics 67
    Description 67
    Financials 67
    News 67
    List of abbreviations 68

    Charts and Figures

    About this report 2
    What does the report contain? 2
    Who is it useful for? 2
    What are the sources and methodology? 2
    Summary 3
    Market background 3
    Market drivers 3
    Competitive landscape 3
    Outlook 4
    About Apex Insight: 2018-19 Parcels & Logistics Research Programme – highlights 5
    About Apex Insight: recent parcels, transport and logistics consulting experience 6
    About Apex Insight: example parcels / delivery research and consulting clients 7
    Contents 8
    List of charts and tables 11
    About the Market 12
    Two-man Delivery Market 12
    Definitions 12
    Market Trends and Characteristics 13
    Meeting Customer Expectations 13
    Home Delivery Software Management 13
    Removal and Disposal 13
    The Recycling Group Limited 14
    The Furniture Recycling Group Limited 14
    Connection / Assembly 14
    Deliveries & Dwell Time 18
    Increasing Online Sales of Big Ticket Items 18
    Driver Recruitment 19
    Supply chain trends 19
    Market Size and Growth 20
    Two-man Home Delivery Market Size and Growth 20
    Two-man Delivery Market Size by Segment 21
    Two-man Delivery Market Volume by Product Category (Delivery Volumes) 22
    Two-man Delivery Market Value by Product Category (Delivery Segment) 23
    Two-man Delivery Connection / Assembly Market Value by Product Category 23
    Two-man Delivery Disposal / Recycling Market Value by Product Category 24
    Two-man Delivery Market Forecasts 25
    Two-man Delivery Market Forecast by Segment 25
    Two-man Delivery Market Volume Forecast by Product Category 26
    Two-man Delivery Market Forecast by Product Category 26
    Two-man Delivery Connection / Assembly Market Forecast by Product Category 27
    Two-man Delivery Disposal Market Forecast by Product Category 27
    Market Drivers 28
    Retail sales 28
    Internet retail 29
    Shopping Trends in Big Ticket Items 30
    UK Housing Transactions 32
    Consumer confidence 33
    Competitive Landscape 34
    In-house vs. outsourced provision 34
    Outsourcing trends 34
    Leading outsourced providers 35
    UK Two-man Home Delivery Revenues 36
    UK Two-man Delivery Profitability 36
    Two-man delivery customer relationships 38
    Two-man delivery service providers used by top UK online retailers 38
    Historical Two Man Delivery Contract Awards 39
    Company Profiles 43
    Panther Warehousing 43
    Description 43
    History 43
    Financials 44
    Key Clients 44
    News 45
    Wincanton 47
    Description 47
    History 47
    Financials 47
    Key Clients 47
    News 48
    Expert Logistics 49
    Description 49
    History 49
    Financials 50
    Key Clients 51
    CEVA Logistics 52
    Description 52
    History 52
    Financials 52
    Key Clients 52
    News 53
    ArrowXL 54
    Description 54
    History 54
    Financials 55
    Key Clients 55
    News 56
    DX Group 57
    Description 57
    History 57
    Financials 57
    Key Clients 58
    News 58
    Breezemount 60
    Description 60
    History 60
    Financials 60
    Key Clients 61
    News 61
    BJS Distribution 62
    Description 62
    History 62
    Financials 62
    Key Clients 62
    DHD Direct 63
    Description 63
    History 63
    Financials 63
    Key Clients 63
    DSV Solutions 64
    Description 64
    History 64
    Financials 64
    Key Clients 64
    XPO Specialist Services (Norbert Dentressangle) 65
    Description 65
    History 65
    Financials 65
    Key Clients 65
    News 65
    Rhenus Logistics 67
    Description 67
    Financials 67
    News 67
    List of abbreviations 68

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