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The last mile delivery market is estimated to grow at a CAGR of 15.62% between 2022 and 2027. The size of the market is forecast to increase by USD 165.6 billion. The growth of the market depends on serval factors, including the growing global e-commerce industry, premiumization of goods and merchandise delivery, and a growing number of warehouses.
This report extensively covers market segmentation by service (B2C and B2B), Application (FMCG, e-commerce, retail, and others), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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Technavio categorizes the global last mile delivery market as a part of the global trucking market within the global transportation market. The parent global trucking market covers companies engaged in goods and passenger land transportation, including vehicle rental and taxi companies. Technavio calculates the size of the global trucking market based on the combined revenue generated by companies operating in the goods and passenger land transportation sector, including vehicle rental, leasing, and taxi companies. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The growing global e-commerce industry is notably driving the market growth, although factors such as the operational challenges for last mile delivery companies may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Last Mile Delivery Market Driver
The growing global e-commerce industry is the key factor driving the global last mile delivery market growth. The e-commerce industry in China and the US is growing rapidly. For instance, e-commerce retail sales in the US increased by 39% in Q1 2021 over that in Q1 2020, whereas total retail sales showed a growth of only 16.4% in Q1 2021. Similarly, China is home to a large number of e-commerce players, which significantly contributes to the growth of the B2B last-mile delivery segment.
Currently, some of the major logistics providers, such as XPO Logistics, also provide last-mile delivery services and deliver around 13 million packages in a year. Last-mile deliveries account for a significant portion of this market share. The online retail market in North American countries is expected to witness continuous growth and investments during the forecast period. This will increase the demand for last mile delivery services during the forecast period.
Key Last Mile Delivery Market Trend
The strong focus on technological advances will fuel the global last mile delivery market growth. A major trend in the market is the growing adoption of advanced technology for real-time tracking, which allows consumers to manage and modify their retail deliveries with the help of easily accessible online tools. Such tools provide greater transparency to customers besides offering them complete control over package delivery. Large packages or goods need to be collected directly by the customer during delivery due to their high value. These packages cannot be delivered outside homes, which poses a challenge for delivery services companies.
Delivery providers are providing their customers with web and mobile-based last-mile delivery management applications for managing the delivery schedules for large or heavy packages. These applications allow the real-time management of package delivery and electronic rescheduling and notifications/alerts to the customer through email, electronic messages, or voice calls in the case of delays due to inclement weather or heavy traffic. All these technological advances are expected to have a positive impact on the growth of the market during the forecast period.
Key Last Mile Delivery Market Challenge
The operational challenges faced by last mile delivery companies are a major challenge to the global last mile delivery market growth. A key challenge associated with last-mile delivery operations is to provide transparency and improve delivery efficiency while maintaining profitability. Long-distance transportation (logistics) is mainly carried out in bulk via sea, rail, and road, which results in lower delivery costs. However, last-mile delivery requires separate deliveries to many locations within a region, thereby increasing logistics costs. M
Major costs associated with last-mile delivery include labor and fuel costs. Online shoppers prefer to track the goods being transported, which requires further investments by service providers. Real-time tracking requires additional geolocation-related infrastructure and the use of technologies such as radio frequency identification (RFID) sensors and the generation of tracking codes at each delivery station. These technologies are expensive, which leads to further escalation in the delivery charges. Thus, the operational challenges faced by last mile delivery companies are expected to hamper the growth of the market during the forecast period.
Key Last Mile Delivery Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Last Mile Delivery Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
crst.com - The company offers last-mile delivery services such as white glove delivery of big and bulky, non-conveyable goods, including furniture, appliances, and electronics, to consumers' homes. Also, this segment offers different types of transportation services.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the B2C segment will be significant during the forecast period. B2C-type last-mile delivery refers to the delivery of various parcels and goods from adjacent transportation hubs to consumers. In most cases, last-mile delivery involves the direct delivery of goods to consumers' homes. The B2C last mile segment consists of the delivery of small and lightweight products, unlike B2B last mile delivery. With the increasing sales of products through e-commerce sales channels, the importance of last mile delivery is growing significantly.
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The B2C segment showed a gradual increase in market share from USD 60.82 billion in 2017 and continued to grow by 2021. The global last mile delivery market has grown rapidly over the past few years, with most of the growth coming from the B2C segment. The growth of the B2C services market has also encouraged last-mile service delivery operators to introduce new services that are specifically designed for residential customers. Such services include next-day delivery, same-day delivery, and parcel returns. B2C customers also have the option of availing of real-time shipment tracking and package delivery status updates. It has also been noticed that many prominent players in the last mile delivery market are increasingly focusing on enhancing the consumer experience. They are focusing on improving last-mile delivery services through faster deliveries and easy returns. Such emerging trends will positively impact the growth of the market during the forecast period.
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APAC is projected to contribute 40% growth by 2027. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The last mile delivery market in APAC is expected to register significant growth during the forecast period. China is a major revenue contributor in APAC. This is attributed to the e-commerce market in China, which is the fastest-growing in APAC. For instance, e-commerce sales in China grew at a rate of 28% over the last five years. Also, domestic e-commerce sales are largely influenced by the presence of major vendors such as Alibaba and Jingdong (JD.com). In addition to the presence of global players, APAC has been witnessing rapid growth in the number of small and medium-sized regional e-commerce players. Therefore, the growing e-commerce sector will boost the demand for last-mile delivery services in this region.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by service, application, and region.
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Last Mile Delivery Market Scope |
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Report Coverage |
Details |
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Page number |
169 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 15.62% |
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Market growth 2023-2027 |
USD 165.6 billion |
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Market structure |
Fragmented |
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YoY growth (%) |
13.79 |
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Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 40% |
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Key countries |
US, China, India, Germany, and France |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
C.H. Robinson Worldwide Inc., CEVA Logistics AG, CRST The Transportation Solution Inc., DB Schenker, Deutsche Post AG, DSV Panalpina AS, FedEx Corp., J.B. Hunt Transport Services Inc., Kerry Logistics Network Ltd., Kuehne Nagel Management AG, LaserShip Inc., Nippon Express Holdings Inc., Postmates Inc, Royal Mail Plc, TForce Logistics, TNT Holdings BV, United Parcel Service Inc., United States Postal Service, Werner Enterprises Inc., and XPO Logistics Inc. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast periodCOVID-19. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Service
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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