Free home delivery comes to its end in Hungary?

Forbes.hu reports that despite the constant growth of online commerce, home delivery services suffer from serious labour shortage problems in Hungary. Therefore, they do not have enough drivers to deliver the goods and those who already work at the company have to be well paid to make them stay. Can home delivery come to its end in Hungary? Let’s see what the results show.

Based on the recent research of the Hungarian Central Statistical Office (KSH), Ádám Bengyel, a chief executive officer of Foxpost, the Hungarian parcel sending network, reports that the 10% increase of prices experienced between July and September is the most significant price increase in the last few years.

During the third quarter, the prices of national parcel and transport services significantly went up in Hungary, and during the first two quarters, it was also this sector that produced the biggest price increase.

The chief executive officer also added that it is not impossible to witness a 15% increase in 2018, as the Hungary Post started the year with price increases as well.

In fact, just like in any other branches of the Hungarian economy, basically, the most urgent problem is labour shortage with which the recent price increase can partly be explained. Many drivers are missing from the industry, a lot of whom work for decent-paying public transport enterprises or indeed, abroad. For this reason, it is only with pay rises that they can find drivers.

Another contributing factor to the price increase is that by now, low prices and profitability have become untenable. Low prices might be inviting for the customers in the short run.

However, in the long run, the quality of services might deteriorate due to the development that has not taken place.

The chief executive officer of Foxpost believes that delivery services cannot keep up with the ongoing demand for e-commerce. Accordingly, the price increase can be expected even in the delivery services to parcel terminals and in the prices of the goods, too. To make matters worse, as far as free home delivery is concerned, shops are going to offer it for online purchases on all orders only over a certain sum of money.

Featured image: facebook/FOXPOST

Source: forbes.hu