Shipping companies enjoying online sales surge
Express shipping companies are dealing with Black Friday-like demand as consumers ramp up online purchases of medicine, food and durable goods due to social distancing measures. April delivery volume almost doubled from March, and companies are hiring more people to meet demand, even as operating costs rise to prevent covid-19 infections.
While some shipping companies saw an up to 30% decline in the first half of March, the landscape changed in April and companies work to keep operations running non-stop.
Loggi, a Brazilian app offering last-mile delivery valued at $1 billion after receiving a $150 million investment from SoftBank last June, saw shipments rise 94% in April from March. About 80% of deliveries made by its 40,000 associates in motorcycles involve medicines, meals and supermarket purchases."The operation is under tremendous pressure," says Fabien Mendez, co-founder and CEO of Loggi. Messaging demand fell abruptly since most people are working remotely, but growing online purchases helped offset the drop.
The pandemic does not affect the plans of Loggi, which will invest R$250 million, up 50% from 2019, to hire engineers and buy software, and to spend on automation and distribution centers. The company has one center and two new will open this quarter. Besides that, it has 40 storage and shipping facilities. In February, it took to 180 cities in the interior of Brazil its Leve brand, operated by third parties, of mini-hubs of packaging sorting and mailing.
Data from consultancy GfK show that online sales of durable goods between April 6 and 12 rose 55% year-on-year in revenue terms. Fan sales increased by 122%, followed by sales of epilators (103%), notebooks (95%), electric shavers (91%) and TVs (57%).
Jadlog, controlled by European company DPDgroup, confirms the increase. CEO Bruno Tortorello says shipping volume fell 30% in the second week of March. But, by late that month, online sales experienced a massive increase. "We activated a Black Friday plan in the last two weeks and we are working 24 hours a day."
The most purchased items as the quarantine started were TVs, notebooks and accessories to ensure people could work remotely and entertain their families during the period. Then deliveries started focusing on perishables and prescription drugs. Mr. Tortorello says consumer deliveries make up 60% of his business.
Jadlog already announced 200 spots for temporary and formal workers in driving, assistant and clerk roles to...
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