Published: February 2021 | Report Code: AT12139 | Available Format: PDF | Pages: 115
The global market for last mile delivery valued $15.7 billion in 2019, from where it is expected to witness a CAGR of 20.3% during 2020–2030 (forecast period). This would mainly be due to the increasing use of omnichannel retailing, coupled with a significant rise in internet penetration in developing economies, such as India, Thailand, and Indonesia. Moreover, with an increase in the trust among online buyers and improved website experience, coupled with the level of comfort that is provided to online shoppers, e-commerce has gained significant popularity in the last 10 years. Thus, the e-commerce boom in emerging economies is expected to drive the last mile delivery industry during the forecast period.
COVID-19’s rapid spread has had a significant impact on the global last mile logistics industry. With the imposition of lockdown, reduced workforce, constraints in delivering goods without proper sanitization, and surge in unemployment, import and export services across the globe have been affected significantly. However, services such as food, grocery, and cargo delivery, which involve minimum contact with the final consumer, would be the biggest gainers, due to the lower infection risk here. It is expected that COVID-19 will become a key catalyst for digital and technological advancements in the industry.
In 2019, the B2B bifurcation held the larger share in the market, on the basis of service. B2B e-commerce portals have gained significant popularity, as they offer easier and quicker checkout, along with more-suitable options for repetitive future purchases.
The market for last mile delivery is expected to witness the fastest growth in the e-commerce category, on the basis of application, in the coming years. This would mainly be due to digital platforms gaining significant importance in the logistics market, by enabling small-sized companies to have a wider reach.
Globally, North America was the largest market for last mile delivery services in 2019. The region is home to developed countries — the U.S. and Canada — which are two of the most prominent users of last mile delivery services in the world. Numerous companies are entering the last mile logistics niche, one of the fastest-growing sectors in the region. This is attributed to the rapid adoption of new technologies in the region, coupled with the increasing efficiency of last mile delivery services. Some key players in this region are FedEx Corp., United States Postal Service, and Deliv.
The LAMEA last mile delivery market is expected to witness the fastest growth during the forecast period. With economic development in major LATAM countries, such as Brazil and Mexico, the state of the logistics and e-commerce industry is expected to witness a significant improvement during the forecast period, thereby driving the growth of the market. Furthermore, Brazil is expected to witness the highest adoption of last mile delivery services in the region, owing to the shifting inclination toward technological innovation and the presence of a highly adaptive consumer base.
The deployment of autonomous vehicles is expected to drive a big change in the market for last mile delivery. Artificial intelligence is a key technology for autonomous driving systems, as it enables reliable and real-time recognition of objects around the vehicle. The autonomous driving technology will allow for a drastic reduction in the cost of delivery, thus triggering further growth in e-commerce order volume. New types of vehicles and logistics structures are expected to evolve during the forecast period, to aid this paradigm shift.
The internet of things (IoT) is becoming prevalent within several industries, with transportation and logistics being considered a major sector in this regard. The tracking technology provides customers with real-time insights into their package location, while delivery- partner-centric real-time tracking solutions give businesses a holistic view of the logistics efficiency and inspire them to be more customer-centric. The e-Commerce industry has thrived on this technology, and it has become important for e-commerce players, as well as logistics service providers, to have a robust IT infrastructure in place, to allow for efficient tracking of each transaction and movement of shipments, at any time.
Last mile logistics has been an important area for investors and venture capitalists in the logistics industry. Start-ups are receiving funding from several venture capitalists, in order to expand their business. For instance, in 2019, Lalamove, a Hong Kong-based on-demand logistics provider, raised $300 million funding in its series D round, to execute expansion across the APAC region. Furthermore, Deliv, a U.S.-based company, which received a funding of $40 million in October 2018, has raised a total of $80.4 million in over five rounds. Thus, the surge in funding has been a significant driver for the market in recent years.
The last mile logistics industry has been majorly driven by the tremendous growth of the e-commerce industry across the globe, coupled with its rising share in the overall retail market. As e-commerce allows extensive research and comparison on prices, features, compatibility requirements, specifications, delivery time, and offers, it becomes easier for business customers to compare products from multiple online sources, which is not always possible at brick-and-mortar stores or with distributors. These advantages over brick-and-mortar stores are driving the e-commerce industry and will benefit the last mile delivery market during the forecast period.
|Base Year (2019) Market Size||$15.7 Billion|
|Forecast Period CAGR||20.3%|
|Report Coverage||Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, Competitive Analysis, Companies’ Strategic Developments, Product Benchmarking, Company Profiling|
|Market Size by Segments||By Service; By Application; By Geography|
|Market Size of Geographies||U.S., Canada, Germany, France, Italy, U.K., Spain, Japan, China, India, South Korea, Brazil, Mexico, Argentina|
|Secondary Sources and References (Partial List)||International Road Transport Union (IRU), Bureau of Transportation Statistics (BTS), Connected Vehicle Trade Association (CVTA), European Association of Automotive Suppliers (CLEPA), Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME), Organisation Internationale des Constructeurs d'Automobiles (OICA), Society of Indian Automobile Manufacturers (SIAM), The Intelligent Transportations Systems Joint Program Office (ITS JPO)|
The rise of e-commerce has led to a tremendous growth in the number of parcels delivered to residential or B2C customers. This rapid growth in online shopping has made residential delivery more attractive to key players, and thus, increased the competition among them. In recent years, the major players in the market have taken several strategic measures, such as service launches, partnerships, and facility expansions, to gain a competitive edge.
In May 2020, United Parcel Service of America Inc. announced the launch of the UPS Premier service, to meet the needs of the healthcare industry, by offering them priority handling of shipments. This would help the company classify and identify critical healthcare shipments that require an extra level of control.
In May 2020, DHL International GmbH launched a one-stop customer portal for digital logistics. The platform would merge existing online services, such as myDHLi Quote + Book and myDHLi Analytics, and incorporate them into one comprehensive platform with new services and features. This would offer users complete control, from pick-up to final delivery.
In February 2019, FedEx Corporation unveiled an autonomous delivery robot, to meet the rapidly changing needs of customers. With the bot, retailers are able to accept orders from nearby customers and make bot-assisted deliveries directly to their homes or offices the same day.
The last mile delivery market report offers comprehensive market segmentation analysis along with market estimation for the period 2014–2030.
Based on Service
Based on Application
The last mile delivery market CAGR forecast for 2020–2030 is 20.3%.
Though the COVID-19 pandemic has affected the last mile delivery industry negatively, food, grocery, and cargo delivery services are expected to get a boost during these times.
North America dominated the last mile delivery market in 2020; whereas, LAMEA is expected to witness the fastest growth in the coming years.
Autonomous vehicles are the key last mile delivery industry trend as they could help reduce the operational expenses for logistics companies, and, in turn, the delivery cost for the final customers.
The competitive landscape of the last mile delivery market is characterized by partnerships, service launches, and facility expansions.
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