Irish express and courier boom has gone
The boom days for express and courier companies serving Ireland have gone, leaving fierce competition for business within an industry swollen by players who came in during its heyday about two years ago. This has resulted in downward pressure on prices in both the domestic and international markets.
According to local operators, the main factors behind the slowdown, which has already seen some businesses go to the wall, are a decline in the Irish economy and the increasing use of e-mail and the internet in sectors such as public relations and printing. Until relatively recently, both these sectors were major users of courier and express services.
As Danny Duggan, managing director of ESP Courier & Mail Express in Dublin puts it: “The glory days have definitely gone at the moment. The country is in the start of a recession.
“How long that will continue, I am not sure, but there are more players in the market now that have come in over the years when it was doing well, so it will be interesting to see how companies sustain themselves while everybody is cutting back and there are job losses going on all the time.”
ESP provides general courier and financial mail services for agents outside of Ireland, which Duggan believes will remain steady despite any recession.
“Some of them may drop a bit, but … there are the financial institutions with reports going out, and sometimes they send even more when things are going badly.”
The overall decline in the Irish market is confirmed by Joe Costigan, managing director of Dublin-based company Air Connect International. “We are holding our own, but I think the market in general is going down,” he says.
“Some days our exports are colossal going out of Ireland and then two days later you can be down 30 or 40%,” he continues.
“But overall, we are up by 10 per cent on this time last year, so I suppose that is one good thing. If we were to go back a year we would have been up by 30 or 40%, so the growth isn’t as great as it was up to, say, two years ago.”
Air Connect International’s results come despite the loss of its biggest customer, Asia Pacific Express, in the middle of January. “We have been hard hit in the UK with the likes of Asia Pacific and WPE going out of business,” Costigan agrees. “They were big players for us, but we replaced all that business within six weeks. We are actually busier now with our import business than we were when Asia Pacific were there.”
This replacement business has largely come from companies in the London area which previously channelled their shipments through Asia Pacific. “A lot of retailers were putting a lot of stuff into Asia Pacific, who were sending it on to us. But now they are dealing directly with us,” Costigan explains. Among these retail courier companies are Transworld Couriers, B&H Worldwide and Flight Logistics, “the sort of people who were big movers with Asia Pacific and have now decided to use us directly.”
A close relationship with its customers has also helped Go-Far Air Express in Dublin maintain growth in a somewhat sluggish market. “We are a smallish outfit and we listen to our customers and adapt to their needs,” says director Patrick Doran. “We offer a service, not a system.”
Go-Far merged with Cyclone Couriers in Dublin last year, with the former looking after the joint international business, the bulk of which is to the UK market.
“We fly into the APC (Alternative Parcel Company) group, which has about 150 independent courier companies in the UK,” Doran explains. "Shipments are collected at their hub in Darleston, they put them into their system there and they are delivered by all the different companies. We have been in APC for two years now and it works very, very well for us. We have also got the APC computer system.”
Go-Far’s shipments to the UK are carried by Aer Lingus, with return traffic travelling on a DHL heavyweight flight organised by APC. To the UK: “We were dealing with bmi,” Doran says, “but they cut off much earlier now. They have cancelled their last flight
that everyone used to use, so Aer Lingus is our only carrier at the moment.”
On the other side of the Irish Sea, Coventry-based Target Worldwide claims a share of about 15 per cent of the UK to Ireland parcels market. According to chief executive Paul Murray, this represents business worth over £10 million (€14.5 million) annualised.
Target Worldwide is distinctive in owning its own hardware and assets in Ireland, rather than employing local agents. “Having one’s own network means you have consistency of service; consistency of brand – because you are not giving it to a common carrier – consistency of systems and consistency of management attitude,” he adds.
Target has at least six articulated trucks leaving its central hub in Coventry every night for its Irish hubs in Dublin or Belfast, as well as a 6.5-tonne payload BAC 748 that flies Dublin – Coventry – Dublin every night. “We have a comprehensive service, and we can hit the west coast, which a lot of people can’t,” Murray adds.
The leading provider of airport-to-airport courier uplift across the Irish Sea, Aer Lingus, currently offers 15 flights daily on the Dublin – London – Dublin route, with the first at 0650 and the last at 2100. The UK courier operation “is a very important element of our cross channel product profile,” commercial manager cargo, John Mahon, says. “It ranks second to the Post Office mail and outstrips conventional cargo both in volume and in revenue terms.”
Aer Lingus now has a dedicated courier handling facility at Dublin airport, allowing a 60-minute cut-off before flight and 60-minute availability upon arrival. “We deliver that nearly 100 per cent of the time,” says Mahon.
Reflecting the business slowdown since the peak two years ago, carrier bmi saw courier traffic between Heathrow and Dublin fall by 10 per cent in 2002 from the 2001 level, while traffic between London and Belfast slipped by 20 per cent in the same period. In the
first quarter of this year, Heathrow – Dublin traffic declined by 30 per cent compared with a year earlier, although there was a 17 per cent improvement between Heathrow and Belfast.
“It is not as busy as it was,” agrees bmi’s cargo marketing manager, Vince Gibson. “I think that a lot of documents go by e-mail and the internet now, although it is strange that certain routes are busier than others. We are carrying quite a lot of mail on our Dublin service as courier, for example.”
To the Irish Republic, the carrier offers seven daily flights in each direction between Heathrow and Dublin. The carrier has rebranded its courier product as 236 Courier, reflecting the IATA code for bmi.