UberRush Can Capture Market Shares of European Delivery Services

Royal Mail and other European delivery startups can lose their market share to UberRush, which connects one to a courier for delivering goods.

Amazon has already pressurized the postal companies of Europe. They could soon be challenged by Uber, which is planning to enter the delivery sector. In addition to it, other entrants could also threaten them.

Uber’s service ‘UberRush’, which connects one to a courier instead of a cab, and new delivery startups, such as Nimber (“Send it with someone going that way, anyway”) and PiggyBaggy (“Ride-sharing for goods”) are able to dent the market share of delivery service providers like PostNL, Deutsche Post and Royal Mail, investors and equity analysts spoke to Reuters.

They are starting to factor in the long-term impact on the stock value of these incumbents, which were adversely affect by the entrance of Amazon in the delivery industry and provide delivery services in different European regions. They view this as a harbinger of what is lying in the store for parcel delivery service providers based in Europe if the Uber follows suit.

The British Royal Mail said the move of Amazon would cut down the potential of parcels business by over 50%, which accounts for 50% of approximately $13.7 billion (£9.5 billion) for a few years.

In the meantime, analysts at Credit Suisse estimated that if Amazon succeeds in delivering 50% of its own parcels in 3 to 5 years, the parcel business of Deutsche Post division ‘DHL’ could suffer from a yearly 3% to 5% sales revenue loss.

Uber’s possibility to enter the European postal delivery industry, as done by it in some of the American cities like New York, Chicago and San Francisco, along with other companies depending on common people instead of business for faster and cheaper parcels deliveries, is viewed as another attempt to drag the stakes of Royal Mail, PostNL and Deutsche Post.

The ride-sharing enterprise said it has “currently” not planned to provide UberRush in the United Kingdom, but analysts indicate it would soon be introduced elsewhere, assuming rapid growth of its cab service.

If the transporter captures 10% of the British courier market, it would be equivalent to a $1 billion (£700 million) for the organization from only one country, a report provided by Parcel Hero revealed, which states the parcel industry and international courier generates revenues around $250 billion every year.

Royal Mail, PostNL and DHL expressed confidence when questioned regarding how they would face these threats, with some telling that similar operations were being developed by them.