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Bus & Coach, Freight & Post Covid-19 Revenue

Post Covid-19, the continued growth in consumer purchasing online has increased supply chain opportunities for large, international logistics companies down to last mile community-based couriers.  The Bus & Coach industry has a renewed opportunity to play a role in this growing supply chain, and thus have or grow a freight revenue stream, as many try to adjust to the new near and midterm normal of ridership.

Parcel, freight or cargo, depending on where you are in the world, has a history in Bus & Coach as a product offering, in particular in the longer intercity routes.  However, much like other aspects of the Bus & Coach industry, metrics on size of the industry or number of bus companies offering the service are hard to find.  Just search such as ‘Bus & Coach industry freight shipping’ for a wide range of results.

Nonetheless, one can find trends over the years, for example, Mexico’s Grupo ADO sold their Multipack parcel business to FedEx in 2011 for $112 M USD.  This use case reflects the past and new growth opportunities for Bus & Coach in Central and South America.

Like politics, the decision for a bus operator to offer freight transport will likely be based on their local market.  According to Marc Hoffman, whose has worked with coach operators in Europe since 2013, “Although during the last few years there have been tests from various operators in Western Europe to create revenue with carrying parcel in buses, it has never become a relevant segment.  For tours towards the South and Eastern Europe it is more common but often managed by drivers individually and directly at the bus.”

Freight Trailer for behind the bus

However, regardless of where you operate, we believe some of the most valuable space an operator can sell lies below the passenger floor.  Buses are moving, space is available, and trailers as seen here are manageable.  Empty space is leaving money on the table.

Another certainty is there will need to be a technology investment for Bus & Coach to capture their share of this supply chain growth: omni-channel sales, scalable pricing, smooth, efficient packing, drop off and pick up, last mile integration and tracking shipments to name a few. 

For example, according to Jose Juan Ciccia, whose Civa Bus of Peru transports one million plus cargo items annually, “while my cargo business is growing today, technology will continue to drive more competition. I know Civa needs to keep up, we continue to invest in the cargo customer experience and the ability to seamlessly work with partners for the door to door delivery.”

All in all, while a bus company’s decision to launch parcel as a product will be based on regional and local market opportunity, and some tech upgrades will be needed, we believe the opportunity exists for more of the industry to provide freight as a valuable service and thus grow a parallel revenue stream.  The use cases are there, consider a university student returning to school with household items, shipping to rural communities often served only by bus, or larger irregular items that can easily fit under a bus or in a tow trailer.

We recommend bus operators assess freight as a product in relaunching and scaling out of Covid-19. With the right technology provider, this should not be a difficult initiative to implement, and Betterez can help you get there with a solution that can scale with you. We invite you to click here to schedule a software demonstration of the Betterez eFreight module and see how it can help you drive ancillary revenues with little effort.

Wishing the entire Bus & Coach industry a safe and speedy return to the roads!