PostEurop: The EU Parcel Market Is Already Competitive. So Why Regulate It?

A new report from Copenhagen Economics, commissioned by PostEurop and published in May 2026, makes a clear-cut argument: the EU e-commerce parcel delivery market functions well, and sector-specific regulation would likely do more harm than good.

However, the PostEurop-commissioned report concludes EU parcel markets are competitive, but self-reported operator data and the client’s direct interest in lighter regulation undermine its credibility.

Multiple Players, Real Competition

The study assessed competition across three dimensions (market structure, firm conduct, and market performance) covering EU Member States plus Norway.

E‑merchants act as buyers with significant bargaining power. They select operators, negotiate contracts, and pay for delivery, while translating consumer expectations into service specifications. Demand is highly fragmented across a large, heterogeneous group of buyers that differ in size, business model, and shipping patterns. Contracts are individually negotiated and reflect each buyer’s traffic profile. Large e-merchants command strong bargaining power through high, predictable volumes, securing lower prices and tailored conditions. SMEs face the opposite: small, irregular volumes mean standardized tariffs and less influence. They can partially offset this disadvantage by pooling demand through consolidators or logistics platforms.

In terms of market structure, the picture is one of genuine rivalry. EU countries average 19 domestic and 11 cross-border parcel delivery operators. Mystery shopping across over 436,000 web shops found an average of nine distinct carriers displayed per country at checkout. Market shares for the leading parcel operator typically range from 37 to 50 percent — far more dispersed than in letter markets, where the main operator often holds above 80 percent.

The market also spans diverse business models: national postal operators, pan-European integrators such as DHL and DPD, vertically integrated platforms such as Amazon and Vinted, specialist last-mile players such as InPost and Instabee, and consolidators that help smaller merchants access competitive rates. This variety is a hallmark of a healthy, competitive sector, not one in need of top-down correction, according to the researchers.

Entry Is Active, and Incumbents Are Responding

Between 2015 and 2025, the average number of domestic parcel operators per EU country grew by 27 percent. New entrants pursued focused strategies: specializing in last-mile delivery, expanding internationally, or leveraging adjacent logistics capabilities.

Entry barriers in EU e-commerce parcel delivery are low, consistent with a competitive market. No legal barriers to entry exist, and the market organization supports new entrants and sustains competitive pressure. New operators have entered the market in recent years and attracted a meaningful customer base.

New entrants to EU parcel delivery have pursued four main strategies to overcome scale and capital barriers. Some specialize in specific value chain segments (particularly last-mile delivery via locker networks or flexible home delivery) or act as digital consolidators pooling small shippers’ volumes. Others vertically integrate from e-commerce retail into delivery, as Amazon Logistics, Vinted GO, and bol.com (with Ampere) have done. Entry from adjacent markets is also common, with newspaper distributors, logistics firms, and international integrators adding parcel delivery to existing portfolios. Finally, operators expand internationally by leveraging domestic expertise and technology, entering new markets organically or through acquisition.

InPost captured a 35-40% share of the Polish CEP market through its locker network. Instabee captured up to 15 percent of the Swedish parcel market. Amazon Logistics entered Germany and Belgium and quickly gained a meaningful share. These aren’t marginal players; they’re reshaping incumbent behavior.

Existing operators responded by investing in their own locker networks, partnering with tech entrants, or acquiring innovative startups. This dynamic (entry forcing incumbents to invest and improve) is precisely what competitive markets are supposed to produce, according to the researchers.

Prices Are Moderate, and Service Quality Is High

EBIT margins for parcel operators averaged just 5.5 percent in 2025, in line with regulated margins in the German postal sector. Cost pressures from wages and fuel are squeezing margins further, while buyer power from large e-merchants and consolidators keeps prices competitive.

Parcel delivery operators are continuously raising service quality to meet online shoppers’ and e-merchants’ expectations for predictability, reliability, convenience, and speed. Investment is primarily commercially driven, with operators upgrading infrastructure to handle rising volumes and maintain competitive offerings.

Online shoppers across the EU have access to a wide range of delivery options in both urban and rural areas. Multiple operators compete in each market, supporting broad service availability. Assessed across delivery modes and the accessibility of delivery locations, the evidence points to broadly comparable service levels across geographies.

For consumers, delivery charges averaged around €5 for home delivery and €3.30 for parcel lockers. For frequent online shoppers, delivery costs represent less than 0.9 percent of annual expenditure. Some 87 percent of cross-border shoppers reported satisfaction with delivery prices, and 73 percent received free delivery on cross-border orders. Service quality is similarly strong. Actual delivery speeds average around one day from handover. Complaints have declined since 2020, satisfaction has risen, and 90 percent of parcel tracking users report satisfaction. Crucially, urban-rural differences in both price and delivery speed are minimal. The researcher’s findings challenge the assumption that rural consumers are systematically underserved.

Key innovation strategies include expanding delivery networks and introducing new delivery methods, upgrading IT systems to improve tracking and user experience, developing tailored services for e-merchants, including SME-focused solutions, and deploying artificial intelligence to optimize routing and reduce costs. While investment may concentrate on attractive urban segments, there is no widespread evidence of a territorial investment gap across the EU.

In e-commerce delivery, markets are working, according to the researchers. Regulation without clear evidence of market failure risks fixing what isn’t broken. Where problems arise, existing competition law is adequate, according to the research. There were 19 domestic and 15 EU-level competition cases in the parcel sector from 2020 to 2025. This is a limited number consistent with a broadly functioning market.

Parcel Lockers: Open and Transparent?

Parcel lockers reduce delivery vans, emissions, and failed drop-offs, but only if consumers can use one locker for every carrier. Today, large parcel companies deploy proprietary networks and refuse interoperability with independent locker operators, protecting market share rather than optimizing scarce urban space. The result: multiple locker walls competing for the same corner, higher public-space costs, and consumers juggling five apps instead of one. And, underpaid PuDo-operators.

Local and European legislation is needed to break this deadlock. Municipalities can attach open-access conditions to public-space permits: no exclusivity, fair access for all carriers and fair pay for operators. At EU level, rules modeled on telecom “must-carry” or energy-network open-access regimes should require dominant carriers to interconnect with independent locker infrastructure under fair, cost-based pricing; sharing installation and maintenance costs proportionally to usage.

Equally essential are data-sharing standards (locker availability, booking status, delivery volumes) and transparency obligations on access terms and tariffs, so regulators and competitors can verify non-discrimination rather than take incumbents’ word for it.

The Regulatory Conclusion

Copenhagen Economics argues that the evidence does not support sector-specific ex ante regulation. Extending the postal Universal Service Obligation to e-commerce parcels (as one option under the proposed EU Delivery Act) would create an uneven playing field between USPs and private operators, potentially distorting the very competition the market already sustains.

The EU’s current postal framework (drafted in 1997 and last revised in 2008) was designed for a world of letter mail and is structurally ill-suited to today’s e-commerce reality. Letter volumes have collapsed by nearly half over the last decade, while e-commerce has more than doubled parcel delivery volumes.

The proposed EU Delivery Act aims to modernize the framework by ensuring affordable deliveries across the EU, promoting fair competition, strengthening consumer protection, and supporting cross-border e-commerce, with particular benefits expected for SMEs, which account for 31% of EU e-commerce turnover. The Commission is now expected to present the Act in early 2027.

According to E-commerce Europe, the Act could focus on:

Modernizing the universal service and ensuring its financial sustainability: a potential intervention could calibrate the universal service so that it still meets user needs (including vulnerable users and SMEs), and remains reliable and future-proof, including in the event of crises. To improve its financial sustainability, the compensation mechanisms might also be revised.
Safeguard user protection: the policymakers are looking at the relevance of amending complaint reporting and procedures for both consumers and small business users, in case of insufficient delivery performance.
Remove the potential market fragmentation: beyond seeking to harmonize licensing and authorization requirements for postal services, the European Commission is also envisaging whether the scope of certain rules and obligations should be broadened.
Guarantee seamless cross-border deliveries: a revision of the postal framework could seek to ensure the quality of such services in terms of, for instance, reliability and parcel tracking, and encourage competition.
Reduce administrative burdens: in line with its simplification agenda, the European Commission notably considers streamlining overlapping obligations and improving cooperation among enforcement authorities.

Do We Need More EU Rules?

Copenhagen Economics says the EU parcel market is working fine. But the report was commissioned by PostEurop — whose members benefit directly from lighter regulation — and leans heavily on self-reported operator data. That is not independent evidence. That is lobbying with footnotes.

Are consumers really happy? Ask the 60 percent of nearly 20,000 Dutch consumers surveyed by Radar who never got their parcel delivered at home, despite a clear agreement. They were in. Sometimes watching the van drive past. Cross-border e-commerce? Still expensive, still slow, still missing basic track-and-trace. And most e-merchants still offer consumers no real delivery choice at all. They play an important role as well.

The report’s mystery-shopping data covers only checkout-visible operators, ignoring the B2B reality in which smaller merchants face genuine power imbalances. Rural access findings rest on a narrow Nordic-only sample. Most tellingly, the report argues against regulation while quietly acknowledging the very market failures (SME disadvantage, consolidator gaps, platform verticalization) that might justify it.

The stakes are real. Europe’s postal sector still employs 1.6 million people and generates 0.4% of EU business turnover. The coming decades will determine whether it becomes an efficient, green, data-driven delivery backbone or fragments under outdated rules and uneven national reform.

I’d argue the market can’t fully self-correct on quality because the person who suffers poor service (the recipient) has no direct purchasing leverage over the carrier; only the sender does, and the sender optimizes for cost. That’s a structural market failure, not a temporary inefficiency competition will fix on its own. Here is the uncomfortable truth: in a consolidated market without double-digit growth, you don’t win on price. You win on trust, loyalty, and repeat customers. That era of effortless volume growth is gone. Those who invest in quality and innovation now will be competing at the top. The rest will be watching from the sidelines.

We don’t need more European rules. We need e-merchants and parcel delivery companies to do a much better job. The EU Delivery Act is an opportunity, but only if it is built on honest evidence rather than industry-sponsored conclusions.

Walther Ploos van Amstel.