Will the Economic Bubble Hurt the Courier Business

The Global market for the air delivery & freight services industry is witnessing growth at different paces. On one side, there is developed market, US, and on the other; there are markets which are still being probed as they offer exponential growth potentials. The Asian market has quite a lot room for growth, with China being the major emerging market which throngs opportunities for foreign base companies and India to pick up the pace.

However, low consumer spending and depleting business investments have become an ache for shippers and air couriers around the world. The World Trade Organization has further added to the woes of the industry by forecasting that the global trade volumes will fall 9 percent this year, the sharpest decline since World War Two. 2010 will be an interesting time for companies like United Parcel Service Inc. (NYSE: UPS) and Expeditors International of Washington Inc. (NASDAQ: EXPD).

Though UPS showcased a powerful performance in the global market and slashed its operating expenses, the benefits were nullified by a fall in the company's revenue and shrinking operating margins in segments like the package and supply, and chain and freight in the US domestic market.

UPS, taking the lead in the mobile shipping arena, has introduced the applications for iPhone, iPod and BlackBerry devices. In addition, the company outstretched its global fleet with combining itself with freight forwarding capability that complements its small package and freight shipping processes. Recently, UPS further announced the restructuring of the U.S. Domestic Package segment. By leveraging technology and the management skills of its people, the company is expecting to craft larger geographic operating stature and provide marketing resources at the local level.

The Shipping logistics provider Expeditors International of Washington, has been hit hard by the global economic downturn. However, the group posted better-than-expected quarterly profit. The shipping industry has been touched hard by the downturn as fewer goods traded, creating tough competition. The year began amidst fears of a global financial avalanche, the fourth-quarter results were however better than expected. The Company reported the fourth-quarter gross revenue, net revenue, and operating income with a dip of 5%, 8%, and 7% from the year-ago period, respectively, but the quarter's results reflect gradually improving demand in international shipping.

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