CLS explains simply: Decline of postal cross-border volumes: Extent, causes, background (Part 1)

The cross-border #shipping of #ecommerce #consignments (#commercial (#postal) letters up to 2 kg, and #parcels) has undergone significant #developments in recent years. 
-Pre-pandemic: overall #volumes were rising steadily
–#Pandemic: ecommerce volumes rose in general, but mainly for #domestic ecommerce, while cross-border #exchanges fell as air #transport and #international #supplychains were disrupted 
-Post-pandemic: in most #relevant markets, cross-border ecommerce has been impacted by the #war in #Ukraine

𝟴 𝗸𝗲𝘆 𝗱𝗲𝘃𝗲𝗹𝗼𝗽𝗺𝗲𝗻𝘁𝘀 (“𝘀𝗵𝗼𝗰𝗸𝘀”) 𝗵𝗮𝘃𝗲 𝘁𝗿𝗶𝗴𝗴𝗲𝗿𝗲𝗱 𝘁𝗵𝗲 𝘃𝗼𝗹𝘂𝗺𝗲 𝗱𝗲𝗰𝗿𝗲𝗮𝘀𝗲 𝘀𝗶𝗻𝗰𝗲 𝟮𝟬𝟮𝟬
This #development has been analyzed in detail at #UPU level, and several drivers have been identified. 

They are:

1. #COVID-19 #pandemic (February 2020)
2. Increasing UPU rates (Terminal Dues; July 2020)
3. #US Stop Act (January 2021)
4. EU #ICS2 Release 1 (March 2021)
5. EU #VAT Reform (IOSS; July 2021)
6. Ukraine crisis (February 2022)
7.  #Inflation (April 2022)
8.  #Recession risk (June 2022)

𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗰𝗮𝗿𝗴𝗼 𝘃𝘀. 𝗨𝗣𝗨 𝘃𝗼𝗹𝘂𝗺𝗲𝘀
#Marketintelligence indicates an overall #decline in cross-border ecommerce #volumes of around 20% since the pandemic. Supply-chain #disruptions resulting from the pandemic have not permanently depressed overall #volumes, instead volumes appear to have shifted: while #internationalcargo volumes remained largely constant and have now returned to pre-pandemic levels despite the Ukraine crisis, cross-border commercial #items (UPU) were hit hardest, falling by more than 2/3rds.
This immediately raises two #questions: 
– What caused the above-average decline in the UPU mail channel? 
– Where have these volumes migrated? 

𝟭. 𝗧𝗵𝗿𝗲𝗲 𝗺𝗮𝗷𝗼𝗿 𝘀𝗵𝗼𝗰𝗸𝘀 𝗰𝗮𝘂𝘀𝗲𝗱 𝗺𝗼𝘀𝘁 𝗱𝗲𝗰𝗹𝗶𝗻𝗲 𝗶𝗻 𝘁𝗵𝗲 𝗨𝗣𝗨 𝗰𝗵𝗮𝗻𝗻𝗲𝗹
From today’s perspective, three major “#shocks” were the primary #cause of the #decline in the volume of international UPU commercial items. The most relevant was the pandemic, directly accompanied by the #reform (= #increase) of UPU rates (terminal dues) which almost halved #international #mail #volumes in #2020. The third massive shock was the introduction of the #EU #VAT #Ecommerce #Package, resulting in higher #costs and #prices. ICS2, #Brexit and the Ukraine crisis are also relevant, although they have had less of an #impact.

𝟮. 𝗩𝗼𝗹𝘂𝗺𝗲𝘀 𝗺𝗶𝗴𝗿𝗮𝘁𝗲𝗱 𝘁𝗼 𝗰𝗮𝗿𝗴𝗼 (𝗕𝟮𝗕) 𝗮𝗻𝗱 𝗱𝗶𝗿𝗲𝗰𝘁 𝗶𝗻𝗷𝗲𝗰𝘁𝗶𝗼𝗻 𝗳𝗼𝗿 𝗳𝗶𝗻𝗮𝗹 𝗱𝗲𝗹𝗶𝘃𝗲𝗿𝘆 (𝗕𝟮𝗖)
Digitalization has led to managed and #integrated #supplychain solutions and the further growth of volumes outside the designated #postal networks. Those combining the best of the UPU, non-designated postal, and #cargo worlds are currently the winners.