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Christmas logistics: Behind the scenes of Amazon, Royal Mail and more after a predicted £25.1 billion online spend in 2017

Thursday, 16 November 2017 GMT
Author: Staveley Head

Christmas logistics: Behind the scenes of Amazon, Royal Mail and more after a predicted £25.1 billion online spend in 2017

  • Courier Insurers, Staveley Head, conducted behind the scenes research to find out what goes on after a predicted £25.1 billion will be spent online in the UK over the 2017 festive period
  • Staveley Head explored some of the UK’s biggest brands including Amazon, Argos and Royal Mail to see how retailers handle the busiest time of the year
  • A huge 79,050 lorries and vans will be on the roads delivering parcels for Christmas
  • 320.9 million parcels will be in transit
  • 16 million miles are driven during Christmas by couriers
  • The average Amazon warehouse picker walks 14 miles per day during the Christmas period
  • Staveley Head launch an interactive report, giving you behind the scenes access to Christmas logistics

Courier Insurers, Staveley Head, have collated behind the scenes data from some of the UK’s biggest brands including Amazon, Argos, Royal Mail and more, to reveal what goes on to deliver your parcels in time for Christmas. 

Christmas spending: £25.1 billion is predicted to be spent online over the 2017 Christmas period in the UK

Retailers mark the Christmas period as 13th November up until Christmas Eve, and within this time a huge £25.1 billion(1) is predicted to be spent online.

The prediction is based on the last 6 years’ worth of data which reveals that online Christmas spending has more than tripled since 2011. In 2011, £7.9 billion was spent(2) whereas £25.1 billion is predicted in 2017. 

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The average home splashes out £809.97 at Christmas(3) and almost 90% of the UK does at least part of their Christmas shopping online(4).

So, what goes on behind the scenes of Christmas after billions of pounds have been spent, and how do retailers deal with the chaos?

Behind the scenes of Christmas 2017: 320.9 million parcels on the way

Research reveals that based on a predicted £25.1 billion spend, 320.9 million parcels(5) will be in transit across November and December delivering items in time for Christmas.

16 million miles(6) are driven across Christmas by Royal Mail delivering to a huge 27 million homes(6). To be able to do this, retailers and couriers are having to recruit and use extra vehicles to deal with the mass amount of orders and parcels. 

79,050 lorries and vans will be on the road delivering Christmas parcels

The number of vehicles delivering Christmas orders is expected to increase dramatically bringing the total amount of vehicles to 79,050(7).

When breaking this down by brand, Courier brand Hermes is expected to nearly double their vehicle numbers, using an extra 9,500 vehicles for Christmas on top of their normal 10,000. Hermes will be part of the courier team supporting Amazon and Argos with their parcels(9)

Brand Number of vehicles Additional vehicles for Christmas Total on road
Royal Mail 47,000 6,800 53,800
Hermes 10,000 9,500 19,500
DPD 3,500 950 4450
UPS No info 1300 1300
    Total 79,050

Royal Mail have 47,000 vehicles working across the year delivering parcels in the UK. However, an extra 6,800 are used to manage the increase in parcels during the Christmas period.

Christmas staff: extra 49,000 hired across Royal Mail, Argos and Amazon

To help cope during the busiest time in retail, an extra 49,000 seasonal staff(8) will be hired across Royal Mail, Argos and Amazon bringing the total staff numbers working for the three brands to 263,7018. 

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Amazon UK will be hiring the most additional staff, an extra 20,000 across all departments, on top of their 24,000 regular employers, to deal with Christmas orders. The majority will be hired to work within the 11 fulfilment centres placed across the UK.

Argos have a staff count of 29,565 people in the UK but will be hiring an extra 10,000 for the Black Friday and Christmas periods.

Royal Mail, on the other hand, have a massive 161,136 people working for them across the UK and will be hiring a similar amount of staff to Amazon, 19,000, to deal with all the deliveries, as well as the expected huge amount of returns.

Christmas returns:

Unwanted parcels cost retailers £60 billion a year, as it is said that processing an order can cost between £3 and £10, with the costs of returns double or triple that.

The average returned purchase in the UK passes through seven pairs of hands before it is listed for resale and therefore for some retailers, it's not even worth processing. Many returned parcels are simply thrown away to save on this cost. 

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Figure 1 Amazon Warehouse. Credit http://emgn.com/entertainment/19-crazy-images-of-amazon-warehouses-before-black-friday/

Ashley Peters, Managing Director at Staveley Head, commented: “As insurers of Courier and HGV drivers in the UK, we wanted to go behind the scenes to see the impact of Christmas on logistics and what happens once an order has been placed. The amount of extra staff and vans hired to deal with the sheer volume of parcels is quite incredible, and can be a very expensive, logistical nightmare for so many companies.

Our Christmas logistics research aims to raise awareness of the behind the scenes effort that courier drivers, warehouse operatives, retail employees and postmen/woman go to, in order to deliver a smooth and efficient service each year.”

Explore the interactive behind the scenes report here.

 

-Ends-

Notes to Editors

1. £25.1 billion is predicted based on the last 6 years of online Christmas spend data

Year Spending in Billion GBP
2011 7.9
2012 9
2013 11
2014 21.6
2015 24.4
2016 25
Total  

2. Online retail spending in the United Kingdom (UK) during the Christmas period in 2011 to 2016 (in British pounds) * https://www.statista.com/statistics/283317/online-christmas-retail-spending-in-the-united-kingdom-uk/

3. http://realbusiness.co.uk/sales-and-marketing/2016/11/24/uk-christmas-spending-hit-record-77-56bn-in-2016/

4. https://www.statista.com/study/39688/christmas-shopping-in-the-united-kingdom-uk-statista-dossier/

5. Based on internal forecasts
2015 = 260,000,000
2016 = 289,120,000 (+11.2% YoY)
2017 = 320,923,200 (+11% YoY)

Based on source: https://www.metapack.com/wp-content/uploads/2017/03/March-2017-Delivery-Index-February-2017.pdf

6.  https://www.royalmailgroup.com/en/press-centre/press-releases/royal-mail-group/royal-mail-is-gearing-up-for-christmas-with-extra-trucks-planes-and-trains/

7. Royal Mail, Hermes, DPD and DPDUPS

8. Royal Mail recruit 19,000 temp workers, Argos hiring seasonal staff, Amazon hire 20,000

Brand Annual staff + Seasonal staff Total
Royal Mail 161,136 +19,000 180,136
Argos 29,565 +10,000 39,565
Amazon 24,000 +20,000 44,000
      263,701

9. Royal Mail annual report, Argos annual report, Amazon hire 5000 people

Media information

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About Staveley Head

Staveley Head are insurers of Courier and HGV drivers across the UK.

Staveley Head is one of the most respected providers of insurance products to businesses and individuals in the UK. Since they began in 1991, they have steadily grown in both size and reputation, expanding their product range from just car and home insurance to business, courier and taxi insurance.

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