Market Trends of Latin America International CEP Industry
This section covers the major market trends shaping the Latin America International CEP Market according to our research experts:
Cross Border E-Commerce Driving the CEP Market
COVID-19 reduced the cross-border percentage of e-commerce spending in 2020, but it is expected to fully recover by 2023. Brazil is Latin America's first and largest country and continues to be the regional powerhouse, accounting for 50% of total e-commerce spending in 2021. The cross-border market in Brazil decreased by 11% in 2020 because of COVID-19 restrictions.
Moreover, with attractive bi-lingual websites and strong connections with logistics businesses in Chile, e-commerce is seen as a vital instrument for local exporters to penetrate worldwide markets. Local shoppers prefer Alibaba for foreign online shopping because of the lower pricing, yet delivery times may be lengthy, and the goods may not be as expected. Amazon is a great alternative for local customers because it now sells products made by Chilean enterprises. However, certain brands do not ship abroad. Local shoppers, on the other hand, are eager to take advantage of foreign internet purchases to get a greater range of products and pricing.
Cross-border mobile commerce expanded twice as quickly as traditional e-commerce in Mexico after the rapid spread of e-commerce in Mexico. 2020 proved not just the country's e-commerce and m-commerce growth potential but also enterprises' capacity to shift and adapt to digital channels to stay ahead in the face of a challenging economic future. In 2021, Mexico was leading the cross-border e-commerce sector with more than USD 9.6 Billion in revenue, followed by Argentina and Brazil.
Increasing Parcel Volumes to Provide Opportunities in the Market
Brazil produced 39 packets every second, or 3.4 million each day. Parcel volume increased by 46% Y-o-Y, hitting 1.2 billion in 2020, up from 0.85 billion in 2019. The number of parcels generated per person increased to 6 in 2020, up from 4 in 2019. Brazil is one of Latin America's fastest-growing e-commerce markets. Brazil saw its more established carrier Brazil Post lose both parcel volume and revenue market share to competitors.
The top six carriers in Brazil account for 71% of the country's parcel shipments by volume. Correos de Chile's parcel revenue climbed by 25% in 2020, thanks to a doubling of parcel volumes. The company saw a 240% increase in e-retailer clients using its services in 2020, indicating that e-commerce demand was the main driver of growth. Volumes of parcels and express delivery surged by 71%.
However, due to a surge in e-commerce operations in Colombia, the freight and courier sector rose by 39%. Deprisa, a Colombian express delivery company, stated that it transported more than nine million parcels in 2020, representing a 6% rise, primarily due to a 25% increase in the fourth quarter operating in accordance with the volume of electronic commerce sales.
The increase in parcel volumes is driven by strong e-commerce penetration in Latin America. In 2021, Brazil contributed the highest revenue in the region in terms of e-commerce sales, which was around USD 41 Billion, followed by Mexico and Argentina with USD 40 Billion and USD 9.4 billion, respectively.
