There's a 'margin paradox' impacting the parcel and postal sector.

Many parcel operators are seeing booming e-commerce volumes but shrinking profitability because of the difficulty in getting a clear view of true cost-to-serve.

Posts face an additional challenge with declining letter volumes shrinking revenue against a fixed USO cost base and regulators demanding rigorous cost allocation between commercial and regulated activities.

Accurate costing is hard. Last-mile costs vary by route density, parcel size, and delivery attempts etc and indirect costs are allocated via a broad brush approach that doesn't reflect real operational drivers.

Solving these challenges requires integration of ERP, TMS, sort, last-mile and other data with activity based costing to deliver shipment level cost visibility that's reconciled to the general ledger.

This granular cost data also supports forthcoming regulatory demands i.e. EU ETS extension to road transport and CSRD reporting. Ultimately it turns cost visibility into a competitive advantage — enabling accurate pricing, early identification of loss-making shipments and evidence-based network investment.

You can read the full article on page 77 of the September 2026 issue of Parcel and Postal Technology International.

We're exhibiting at Parcel+Post Expo on September 23 and 24 (stand F35). If you're facing any of these challenges please drop by for a chat - or get in touch. Our LogiCAT product could be just the thing you're looking for.