Messenger and Courier Services Market - New York

Goals

To obtain market information about the messenger and courier services space in New York to include the key players, barriers to entry, case studies of failed companies, and a competitive landscape of key players with pricing information, number of employees, employee wages, target markets, longevity, package size restrictions, and annual revenue.

Early Findings

Preliminary research indicates there are about 16 top courier services operating in New York City that are considered key players. In addition, barriers to entry and information on new entrants in the market are available, but more on a nationwide basis rather than in New York.

BARRIERS TO ENTRY

  • The courier industry is capital intensive because capital is necessary to "set up and run efficient delivery channels."
  • According to industry analysts, "the huge capital outlay needed to start and operate a large package delivery service is a disincentive to new entrants."
  • It is also labor intensive because many employees are needed to staff the delivery channel, which means heavy investments in salary and wages.
  • There is significant competition in the market, with 180,172 courier businesses employing 720,779 people operating in the United States,
  • Non-traditional couriers are entering the market, including Uber and Amazon, which is further saturating the market.
  • It has become almost mandatory for courier services to offer nationwide services in order to compete.
  • Access to customers is another barrier to entry since most have already chosen a courier company to work with.

NEW ENTRANTS

  • Ten parcel and express delivery startups have received "more than $175 million in cumulative funding, and ten others have received more than $50 million."
  • Approximately 34% of those investments are in value chain orchestration and 32% are in end-to-end logistics, but 29% are in last-mile delivery (which is where couriers and messengers would fit).
  • Deliv is a last-minute delivery provider that is looking to disrupt the market and operates in 35 U.S. markets.
  • Other startups include XPO Logistics, Postmates, Hitch, Darkstore, ShipHawk, and Narvar, but none of these have a foothold in the New York courier market (XPO Logistics is supply chain and Postmates is meal delivery).

Proposed next steps:

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