The postal automation system market was valued at USD 710.5 Million in 2017 and is expected to reach USD 1,022.2 Million by 2023, at a CAGR of 6.30% during the forecast period. Growth in the e-commerce industry, increasing labor costs, and rising need for automated sorting and delivery processes in the postal industry are the key factors driving the growth of the market.
According to the new market research report "Postal Automation System Market by Component (Hardware, Software, and Services), Technology (Culler Facer Canceller, Letter Sorter, Flat Sorter, Parcel Sorter), Application (Government, and Courier, Express & Parcel), and Region - Global Forecast to 2023", the postal automation system market is expected to grow from USD 753.3 Million in 2018 to USD 1,022.2 Million by 2023, at a CAGR of 6.30% between 2018 and 2023. The factors driving the growth of the market include growth in the e-commerce industry, increasing need for automated sorting and delivery processes in the postal industry, and rising labor costs.
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Hardware held the largest size of the postal automation system market in 2017
Hardware held the largest market size, in terms of value, in 2017.
Hardware systems are used to sort letters, flats, and parcels based on their barcode reading, shape, size, and volume, and then to divert these parcels to their respective delivery destinations. Various types of systems including letter sorters, flat sorters, and parcel sorters are used in the postal industry.
These sorting machines are essentially mechatronic in nature consisting of electrical, electronic, optical, and electromechanical components. Despite a decline in traditional mail volumes, the growth in the e-commerce segment continues to transform the postal business.
Increase in parcel volumes is expected to boost the demand for hardware systems.
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Governmental postal applications to hold the largest size of the market between 2018 and 2023
Currently, government postal applications hold a larger share of the postal automation system market, and a similar trend is likely to continue between 2018 and 2023. Government postal organizations mostly handle large volumes of letters, flats, and business mails.
The rising demand for faster delivery is driving change in the postal sector, and technological innovations are enabling government postal operators to adopt automation technologies. However, rising parcel volumes had put government postal operators under pressure for faster delivery of parcels.
Government postal operators are responding to rise in parcel volume by investing more in postal automation systems. Thus, the market for government postal applications is expected to grow at a considerable rate during the forecast period.
Parcel sorters held the largest size of the postal automation system market in 2017
Parcel sorters are used to sort parcels or cartons on the basis of their size, weight, and delivery locations. Various types of parcel sorters, such as linear parcel sorters and loop parcel sorters, are used in the postal industry.
Growth in e-commerce has resulted in an increase in the volume of flats and packages, thereby boosting the demand for parcel sorters. Moreover, increased use of parcel shipping by traditional customers, along with the growth in internet retailing and new parcel shipping services, is boosting the demand for parcel sorters to automate and upgrade hub infrastructure.
North America to dominate the postal automation system market between 2018 and 2023
North America is expected to dominate the overall postal automation system market during the forecast period because of increased e-commerce and online retail sales in the region. The increasing need to renovate the existing postal automation systems in North America has resulted in the installation or capacity expansion of these systems, thereby contributing to the growth of the postal automation system market in this region.
United States Postal Service (USPS), a government postal service provider in the US, has been investing in postal automation systems over the years. Moreover, courier, express, & parcel companies operating in the US have signed a number of contracts with suppliers for the installation of postal automation systems, which has resulted in the growth of the postal automation system market in North America.
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The postal automation system market was dominated by key players such as Siemens (Germany), Toshiba (Japan), NEC (Japan), SOLYSTIC (France), Pitney Bowes (US), Vanderlande (Japan), Fives Group (France), Leonardo (Italy), Lockheed Martin (US), and Beumer Group (US).
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