The global market for e-commerce logistics acted as a playground for DHL International GmbH and FedEx Corporation in 2015, who jointly accounted for over 50% of the overall business across the globe. The other two prominent players in the global e-commerce logistics market are United Parcel Service Inc. and XPO Logistics although their presence is not as far reaching as the first two mammoth companies. However, the companies operating in the global market are already upping their game with an expectation of explosive development of the e-commerce segment in China and India. The market space for e-commerce logistics is thus deemed to be extremely lucrative presently and is expected to help the growth of numerous new companies. While the big corporates are heavily investing last mile connectivity and drones to keep themselves ahead of their rivals, the smaller players are concentrating on different value added services such as innovative tracking of parcel and route optimization. These new trends are expected make the global e-commerce logistics market an attractive business space fuelled with innovation.
The global e-commerce market is expected to cross the market valuation worth US$781 bn over the course of the given forecast period of 2016 to 2024. This huge growth is expected to be achieved with the help of a sturdy CAGR of 20.6% over the same period of forecast. In terms of types of service, the transportation segment has been dominating the overall market since 2015 and is expected to continue to do so. From a geographical standpoint, North America led the global e-commerce logistics market in 2015 with valuation of US$48.32 bn and is expected to continue its domination owing to impressive digital infrastructure and strong B2C sales. Asia Pacific market is projected to show most promising growth over the given forecast period with a strong CAGR of 22.4%.
Innovative Methods of Delivery to Drive Growth of Global Market
The rise of the modern day B2C e-commerce business model has enforces the players in the market to alter and re-alter their business models many times in the last few years. New and innovative technologies are considered to be one the key driving factors for the overall growth of the global e-commerce logistics market. Drone delivery is expected to attract maximum attention over the course of the forecast period. In addition to this, e-commerce startups in countries such as Brazil, India, and Mexico have blossomed over the last few years. This is also expected to drive the overall growth of the global market.
Loopholes in Reverse Logistics Services to Slow down Market Growth of E-commerce Logistics
In a market space that is as intensely competitive as the global e-commerce logistics, the players are force to provide various value added services such as free delivery of products and reverse logistics. Even though majority of the players in the global e-commerce logistics market have put up a minimum amount for purchasing products before availing the option of free delivery, there are several loopholes in the arrangement. One of the most common trick used by customer while shopping online is ordering products up to the minimum amount mark and then returning the unwanted products after delivery. This puts pressure on the chain of reverse logistics and hikes up the expenses incurred by the companies in the e-commerce logistics market.
Moreover, in emerging countries, there are numerous infrastructural challenges which restrict the service of last-mile connectivity offered by the players in the market. All these factors are thus expected to slow down the overall growth of the global e-commerce logistics market over the coming years of forecast.
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