State of E-Commerce in Canada 2022
The state of e-commerce in Canada reflects a thriving and rapidly expanding market. In recent years, Canadians have embraced online shopping as a convenient and accessible way to make purchases. This trend has been accelerated by the COVID-19 pandemic, which has further propelled the growth of e-commerce in the country.
The e-commerce market in Canada has experienced steady expansion, with projections pointing towards continued growth. By 2023, the market is expected to generate a revenue of US$62,117.6 million, further solidifying its position as a key player in the global e-commerce scene. The compound annual growth rate (CAGR) from 2023 to 2027 is projected to be 11.0%, indicating sustained momentum and resulting in an estimated market volume of US$94,139 million by 2027.
As part of our annual State of E-Commerce series, this article focuses on the crucial aspects of delivery performance within the Canadian market throughout 2022. We explore how the country's e-commerce logistics have measured up this year, providing insights into the ongoing developments and trends.
94.7% of Domestics Parcels in Canada Were Successfully Delivered on First Attempt in 2022
In 2022, a whopping 94.7% of domestic parcels in Canada were delivered successfully on the first attempt. Several factors may have contributed to this high success rate, one of which is Canada’s well-developed infrastructure that supports smooth logistics and transportation operations. The country’s extensive road networks, combined with reliable postal services, must have played a vital role in facilitating timely and accurate deliveries without any major complications.
Additionally, the strong emphasis on customer satisfaction within the Canadian delivery industry plays a huge part as well. In general, logistics companies in Canada prioritize customers’ needs by offering practices such as flexible delivery options, convenient return processes, and responsive customer support, all of which contribute to the overall success rate of first-attempt deliveries. Canada Post, for instance, has implemented centralized community mailboxes as an alternative to door-to-door delivery in select neighborhoods which reduces the need for individual parcel deliveries to each residence, thus streamlining the process and enhancing efficiency.
52.2% of Parcels in Canada’s Parcel Lockers Were Picked Up Within the First 24 Hours
With the increasing prevalence of parcel lockers, there is a growing familiarity with this delivery option among individuals. Consequently, consumers are becoming increasingly aware of the convenience and benefits offered by these lockers, leading to a higher adoption rate as the years go by. It is thus no surprise that last year, 52.2% of parcels in Canada were collected within the first 24h of being delivered to the collection points.
One possible reason behind this high rate of prompt pickup is the convenience that parcel lockers offer. Positioned in easily accessible locations such as post offices, retail outlets, and residential complexes, these lockers provide a hassle-free way for recipients to retrieve their packages at a time that suits them best. By eliminating the need to schedule specific delivery times or wait at home, parcel lockers grant individuals the freedom to collect their parcels whenever it is most convenient for them.
Flexibility also plays a significant role in driving the swift retrieval of parcels from lockers. Recipients appreciate the flexibility of being able to access the lockers outside of regular business hours. This convenience is particularly beneficial for those with busy schedules, enabling them to collect their packages promptly without disrupting their daily routines.
9.06% of Canada’s Parcels Encountered Delivery Issues in 2022
In 2022, approximately 9.06% of parcels in Canada encountered delivery issues during the shipping process. This statistic highlights a notable portion of shipments that faced challenges or complications in reaching their intended recipients. Various factors can contribute to these delivery issues, ranging from address inaccuracies and difficulties accessing remote locations to failed delivery attempts and customs-related complications. Additionally, packaging problems, transportation disruptions, and high parcel volumes during peak periods can also contribute to the occurrence of delivery issues.
Upon further analysis, we found that carrier-related factors were responsible for 3.97% of the delivery issues in Canada, whereas 5.09%of the issues took place on the recipients’ end. To improve delivery success rates and minimize such problems, measures such as enhanced address verification systems, improved communication channels, optimized route planning, and increased workforce capacity can be implemented. By addressing these factors and implementing appropriate solutions, the goal is to reduce the percentage of parcels encountering delivery issues, ensuring a smoother and more efficient delivery experience for recipients across Canada.
The Majority of International Shipments Bound for Canada Originated from China, the United Kingdom & the United States
Cross-border e-commerce plays a significant role in Canada, with China, the United Kingdom, and the United States serving as major sources of international shipments.
China, renowned for its immense manufacturing capabilities, played a crucial role in meeting Canada's import demands last year. With its vast industrial infrastructure and relatively cheap labor, China produces an extensive range of goods, ranging from textiles and electronics to machinery and consumer products. As a result, it was only natural that a significant portion of Canada's international shipments in 2022 originated from China, reflecting the strong trade ties between the two nations.
Next, the United Kingdom also contributed substantially to Canada's import landscape in 2022. With a long-standing tradition of maritime expertise and commercial prowess, the UK has fostered international partnerships and developed a diverse array of products. Skilled manufacturers, creative industries, and global businesses based in the UK offer appealing goods for Canadian consumers. As a result, shipments from the United Kingdom make their way across the ocean, bringing a distinctly British touch to Canadian shores.
Given their shared border and history of cross-border trade, it is no surprise that the United States is a top source of Canada’s international shipments as well. The longstanding economic ties, coupled with geographical proximity, have resulted in a robust flow of shipments between the two countries throughout the years. Furthermore, the United States' diverse range of industries, such as technology, automotive, and pharmaceuticals, further contributes to its role as a leading origin for export goods that make their way into the Canadian market.
All in all, Canada demonstrated a strong commitment to efficient and convenient logistics solutions, resulting in high delivery performance levels in 2022. That being said, there is still room for improvement as a significant percentage of parcels encountered delivery issues last year. As the e-commerce landscape continues to evolve in Canada, it is increasingly critical for companies to prioritize addressing these challenges in order to meet the growing demands of online shoppers.
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