E-commerce slowdown could see delivery firms re-strategise

Couriers who capitalised on the e-commerce boom over the last 18 months may need to review their strategies after analysis of the market suggested online sales are levelling out.

Research by ParcelHero showed that as shoppers returned to the High Street following the removal of pandemic restrictions, online purchases have fallen as a result.

It predicted that e-commerce would level out at 25% of all retail sales, a significant reduction from the 36.1% of all retail sales conducted online in February.

However, it added that this was still substantially more than the 19% share online used to take, before Covid-19 shook up the market.

David Jinks, ParcelHero head of consumer research, said: “For some months now, retailers have been trying to guess what the new normal will look like.

“We believe the picture has now become a lot clearer. The cash registers have certainly been ringing more frequently in stores ever since non-essential shops returned to life on 12 April, but ParcelHero’s own research shows that 46% of consumers have no intention of returning to their pre-Covid, High Street spending levels.

“Indeed, July saw a decrease in retail footfall compared to June.”

Jinks said online sales fell 4.7% in June compared to the previous month and they have been falling every month since March.

“As a result, everyone has been trying to assess the new ‘natural order’ and it’s looking like online will permanently secure around a quarter of all retail spending,” he said.

“ParcelHero anticipates there will be something of a spending spree on our High Streets during August, as everyone enjoys the Great British Staycation.

“However, the return of colder weather this autumn will likely see new concerns about Covid-19, flu and other illnesses.

“Everything points towards long-term equilibrium, with online spending maintaining a 25% hold on the UK’s overall £51.4bn retail spend,” said Jinks.