Kenya's courier sector races to keep pace with e-commerce boom

Kenya's courier industry is being forced to rethink how parcels reach consumers as rapid growth in e-commerce, social commerce and mobile shopping exposes persistent weaknesses in last-mile delivery.

Despite rising demand for home deliveries, many consumers still contend with missed deliveries, restricted courier operating hours and the inconvenience of waiting for parcels, creating pressure for logistics providers to adopt more flexible collection models.

The changing shopping habits are also reshaping how businesses fulfill online orders.

Data from the Communications Authority of Kenya (CA) shows domestic courier parcel volumes rose by 14.1 per cent to 3.9 million, driven by expanding e-commerce, food delivery platforms and growing demand for last-mile logistics.

At the same time, traditional postal services continue to lose ground, with international incoming parcels declining by 17.7 per cent and outgoing parcels dropping 16.8 per cent, reflecting the sector's migration toward digital commerce and private courier services.

Speaking during the launch of Chui smart parcel locker network in Nairobi, Trade Principal Secretary Regina Ombam said the government would work closely with private sector innovators developing solutions that improve trade and logistics infrastructure.

She said strengthening last-mile delivery systems will be critical in supporting Kenya's growing digital economy and expanding market access for businesses, particularly small and medium-sized enterprises.

The launch comes as courier companies search for ways to improve delivery efficiency while accommodating increasingly mobile-first consumers.

According to the Communications Authority's latest e-commerce survey, postal and courier services account for 42.5 per cent of deliveries, while 28.7 percent of online shoppers collect purchases from designated pickup points and 21.3 percent prefer in-person collection.

The figures suggest that consumers are already embracing multiple fulfilment models rather than relying solely on home delivery.

Kenya's online shopping ecosystem is also becoming overwhelmingly mobile-driven. Mobile applications account for 44.8 per cent of online purchases, followed by WhatsApp at 20.2 per cent, while websites contribute just 12 per cent.

More than 71 per cent of shoppers use mobile phones to place orders, with mobile money remaining the preferred payment method for nearly two-thirds of online transactions.

Nairobi-based logistics technology startup Chui has introduced a network of smart lockers designed to allow customers to collect parcels at any time of the day instead of depending on home deliveries or courier office operating hours.

Chui chief executive George Kinoti said the company was established after its founders observed that Kenya's logistics infrastructure had not evolved at the same pace as online shopping.

"We started looking at the opportunity in 2023 after seeing e-commerce continue to grow following the Covid-19 pandemic. People had become comfortable buying goods online, but the challenge of completing the final delivery remained," he said.

Kinoti said research commissioned by the company found that more than one in five deliveries are unsuccessful because customers are unavailable, addresses are difficult to locate or deliveries are attempted during working hours when recipients are away.

"Our survey showed that over 20 per cent of deliveries are normally missed, even for major retailers. Every failed delivery increases costs for businesses because parcels have to be returned or redelivered," he said.

The company spent much of 2024 studying smart locker systems already in operation across Europe before partnering with Hungarian smart locker operator FoxPost and software developers from Estonia to adapt the technology for the Kenyan market.

Kinoti said the lockers are intended to complement current delivery networks by giving logistics companies an additional delivery option.

"Most courier companies operate between 8am and 6pm, yet many customers are at work during those hours. Instead of attempting multiple deliveries, couriers can leave parcels in secure lockers, allowing customers to collect them whenever it suits them," he said.