With more than one billion parcels set to be delivered in the UK in a calendar year for the first time ever this year, the strain on courier services and competition between retailers are greater than ever. Retailers, desperate to secure continued custom, are using free and next-day delivery options as selling points - despite the apparent lack of sustainability of these in the long term.

Reported in IMPRG and Metapack's UK Delivery Index, the estimation of one billion delivered parcels in 2015 should be a reason for celebration amongst couriers and e-commerce retailers - but it is instead an indication of industries which are careering towards catastrophe.

There are already signs that this is impacting courier services: Yodel famously suspended parcel collections over Christmas 2014 as demand rocketed and City Link went into administration the same week following substantial financial losses.

Despite increase demand for courier services, the intense price war and competition, spearheaded by retailers such as Amazon, means companies are forced to negotiate lower terms with their trusted couriers. As consumers exploit the freedom to explore cheaper alternatives at their leisure - only the most competitive of retailers will survive.

Unfortunately the insatiable demand for free delivery is matched by a similar hunger for next-day delivery which necessitates increased logistical support and subsequent overheads. Amazingly, the courier industry approaches periods of high demand as a potential financial liability.

Dick Stead, executive chairman of Yodel, complained: "The marketplace seems to be demanding more and more - such as next-day delivery - and that will drive up costs. The industry as a whole does not have sufficient capacity to deal with short-term spikes or to deal with extraordinary sales activity. If it is to create that capacity there has to be funding from somewhere."

Unfortunately for Stead and the other heads of courier service companies, the demand from consumers means there is little chance this will change with retailers offering the lowest possible price and advertising the best possible delivery service from their couriers.

Natalie Berg, global research director at Planet Retail, explains: "As consumers have been more demanding, retailers do not have a choice about free delivery. They need to do these things to be competitive. Online shopping has come so far over the past five to ten years. Websites have been upgraded, we have more payment options and we have click and collect.

"But the one area - and the most important area - where shoppers are let down is delivery. And the retailers do not do themselves any favours by offering more and more - like same-day or next-day delivery. We now have some retailers doing Sunday delivery."

As e-commerce companies and couriers rapidly approach in impasse, all parties will suffer including the consumer - as did the customers awaiting their Christmas gifts from Yodel last year. Martin Lewis, from MoneySavingExpert.com has called for tighter regulations and an industry-related ombudsman-type system to help protect all parties.

A spokesperson from courier comparison site, Rapid Parcel, adds: "There needs to be greater clarity from e-commerce retailers as this problem continues to intensify. Giving consumers freedom to select their preferred courier service and clearly displaying delivery costs can help protect suppliers and ensure they receive a fair share of sale as well as helping the couriers operate a sustainable business."

Recent research from Honeywell suggested that 90% of consumers will factor available delivery options into their decisions where to shop online. Retail and grocery deliveries are now so ingrained in the daily life, it is inconceivable that consumers will begin to reduce their online shopping activity. This makes it important for retailers and courier services to work closely to develop a workable system wherein they can continue to offer the delivery demands of consumers, but in a manner sustainable to both parties.