Parcel volumes almost double in 2023 but delivery issues persist, latest Ofcom report reveals

Total parcel volumes increased by 8.3% to 3.9bn items in 2023-24, compared with a 4.8% dip in 2022-23, marking a recovery for the sector, following two years of post-pandemic falls.

However customer service issues continued during the year, according to Ofcom’s latest Post Monitoring Report 2023/2024, published this week.

Over two thirds of customers reported delivery issues and customer satisfaction varied widely, with Amazon leading the pack with a score of 56% and Evri at the bottom, with just 32% customer satisfaction.

The report revealed better news in terms of volumes, with measured domestic parcel volumes increasing by 5.3% year-on-year to 3.4bn, following a 5.1% decline the previous year.

In the domestic parcels market, next-day delivery remained the most popular service type, although its share of all domestic parcels fell by one percentage point to 65.0% during the year, as later than next-day services’ share rose to 31.4%,up from 30.5%.

The research also found that measured parcel revenues decreased by 3.7% in real terms in 2023-24, to £13bn.

However, this fall was lower than the 14.3% decline recorded in 2022-23, and revenues remained higher than £12.6bn recorded in 2019-20, which the report said reflects pre-pandemic levels.

Real-term average unit revenue per parcel dropped by 11.1% year-on-year, from £3.72 to £3.30, and by 6.1% on a nominal basis, which Ofcom said suggests parcel prices have gone down.

Meanwhile domestic parcel revenues stood at £8.8bn in 2023-24, down 2.5% in real terms, and accounted for 67.8% of total parcel revenues, up from 66.9% in 2022-23.

Next-day delivery items remain popular, continuing to make up most domestic parcel revenues at 60.7%, the researchers found.

International inbound volumes increased by 49.7%, which the watchdog said was likely driven by imports from China, compared with a 1.8% rise in 2022-23.

Meanwhile international outbound volumes continued to decline, down by 5.8, compared with a fall of 8.7% in 2022-23.

During the period revenues from international inbound parcels declined by 0.3% to £2bn, despite volumes increasing by nearly half, and accounted for 15.4% of total parcel revenues.

Meanwhile international outbound parcel revenues declined more sharply, by 11.2% to £2.2bn in 2023-24, representing 16.9% of total revenues.

The report also looked at parcel company performance and found that overall the majority of consumers were satisfied with parcel operators. It noted that on average, delivery companies satisfy nearly four in five (78%) of their parcel recipients.

However, this year, two-thirds of parcel recipients (67%) reported experiencing a delivery issue - such as a delayed parcel, it being left in an inappropriate location, failure to deliver a parcel, and/or insufficient/incorrect tracking information - with any parcel operator in the past six months.

Compared to 2023 results, the most common type of issue experienced by recipients continued to be courier and transit issues, including damage to a parcel, the parcel being left in an inappropriate location, and / or the delivery person not knocking loudly enough or ringing the doorbell.

The report said parcel deliveries being delayed and not delivered remain the most common issues for which contact with a delivery company has been made.

On the upside, the research revealed that significantly fewer contacts were made for these reasons in 2024. Of those who reported experiencing an issue with any delivery, there was a four percentage point reduction in these consumers contacting a parcel company regarding a delayed parcel (23% in 2023 and 19% in 2024) and with a parcel not being delivered (20% in 2023 and 16% in 2024).

However reported satisfaction with the contact and complaints handling processes remained lower than with the delivery experience from parcel operators overall.

On average, under half (44%) of those who contacted a delivery company were satisfied with the experience of contacting the company to discuss an issue.

And across all delivery companies, under half (45%) of respondents who had contacted the parcel operator were satisfied with how their complaint was handled by staff (45%); by the contact process (44%); and by the resolution of their issue (48%).

Turning to the performance of pacel operators the report said there was ”considerable variation” between parcel operators.

Amazon and DHL performed highly in all three areas, while Evri had the lowest levels of satisfaction with the contact process overall, followed by Yodel.

The report added: ”While Evri has seen improved ratings across a number of key metrics in our 2024 survey responses it remains, on average, the lowest-scoring delivery company on satisfaction with contact.”

It added: ”Yodel’s satisfaction scores were also lower than the average among those who made contact to discuss an issue and how the complaint was handled by staff.”

Customer satisfation league table: