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The last mile delivery market is estimated to grow by USD 60.82 billion at a CAGR of 5.12% between 2023 and 2028. The market expansion relies on several pivotal factors, including the rapid growth of the global e-commerce sector, a noticeable shift towards premiumization in product offerings, and the increasing prevalence of warehouses. However, challenges persist, particularly in the operational realm for last mile delivery firms dealing with logistical complexities. Risks such as package damage and theft further complicate the landscape, necessitating robust security measures. Additionally, the market contends with the emergence of alternative delivery services, adding competitive pressures. Amidst these dynamics, the industry strives to optimize delivery efficiency while enhancing customer experience, navigating through a landscape shaped by technological advancements and evolving consumer expectations.
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The B2C segment is estimated to witness significant growth during the forecast period. Technological innovations, such as autonomous vehicles and drones, are transforming last mile logistics. Consumer behavior shifts towards on-demand services and peer-to-peer marketplaces necessitate route optimization and mobile applications. Brick-and-mortar retailers and omnichannel retailing, including cloud kitchens and food delivery platforms, are also impacted.
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The B2C segment was the largest segment and was valued at USD 96.08 billion in 2018. Sustainability, cost efficiency, and customer experience are key considerations for companies in the food, e-commerce, retail, and pharmaceutical industries. Last mile delivery involves ground delivery vehicles and shipping costs, necessitating innovations in autonomous and non-autonomous technology. The internet and online shopping have significantly influenced product delivery services, necessitating a focus on last mile logistics and transportation hub efficiency. Thus, such emerging trends will positively impact the growth of the market through the B2C segment during the forecast period.
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APAC is estimated to contribute 46% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market in APAC is experiencing substantial growth, driven by investments in technology and infrastructure. In China, a delivery robot named Scout and other advanced delivery vehicles are being utilized due to the rapid expansion of the e-commerce industry. This sector, which accounts for a significant portion of trading activities in APAC, is influenced by the presence of global players like Alibaba and JD.com, as well as regional e-commerce players.
Moreover, the growth of the e-commerce industry is fueled by the increasing demand for better delivery services, multiple products, and various shipping and tracking options. However, poor infrastructure and logistics costs remain challenges for retailers. The postal address system in APAC also poses complexities for delivery services. To address these issues, freight transportation companies and logistics market players are focusing on system integration, IT standards, and equipment upgrades. The logistics market is expected to witness growth in areas such as warehousing, distribution, fulfillment services, and skilled workers. Hence, such factors are expected to drive market growth in this region during the forecast period.
In the dynamic world of retail and commerce, last mile delivery has emerged as a critical component of consumer experience. With the rise of e-commerce and on-demand services, consumer expectations for real-time tracking and quick delivery have become the norm. Urban congestion poses challenges to logistics processes, making sustainability considerations essential. Last mile delivery encompasses the transportation of goods from a distribution center or warehouse to the customer's doorstep or retail store. Autonomous vehicles, drones, and route optimization through mobile applications are technology insights that aim to streamline this process. Brick-and-mortar retailers and omnichannel retailing have also adopted cloud kitchens and food delivery platforms to cater to changing consumer behavior. Peer-to-peer marketplaces and non-autonomous technology are alternative solutions that offer cost-effective last mile delivery options. Companies must consider company costs, including shipping costs, to maintain profitability while ensuring a positive customer experience. In conclusion, the market is a complex ecosystem that requires continuous innovation and adaptation to meet evolving consumer demands and urban realities. Our researchers analyzed the data with 2023 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.
The market is experiencing rapid growth, driven by the burgeoning global e-commerce industry. The market is experiencing significant growth in both the US and China, driven by the e-commerce industry's expansion. Consumers' increasing expectations for real-time tracking and on-demand services, urban congestion, and sustainability considerations are shaping the logistics process. Technology insights, such as autonomous vehicles and drones, are being explored to optimize last mile delivery routes and reduce company costs.
Moreover, peer-to-peer marketplaces and cloud kitchens in the food industry, pharmaceutical industry product delivery services, and omnichannel retailing are also contributing to the market's growth. Brick-and-mortar retailers are adapting to this trend by integrating their operations with transportation hubs and warehouses to streamline the delivery process to the customer's doorstep. Route optimization through mobile applications and ground delivery vehicles are essential to ensuring efficient and cost-effective last mile logistics. Innovations in autonomous technology and non-autonomous technology continue to shape the last mile delivery landscape. Hence, such factors are driving the market during the forecast period.
A strong focus on offering services to specific end-user segments is the primary trend shaping market growth. In the dynamic market, consumer expectations are increasingly shaped by real-time tracking and on-demand services. Urban congestion and sustainability considerations necessitate advancements in logistics processes. For large or high-value packages, consumers often need to collect them directly from distribution centers or retail stores. This challenge is addressed through web and mobile-based last mile delivery management applications. Technology insights, such as autonomous vehicles and drones, are transforming the delivery landscape.
Moreover, consumer behavior in e-commerce, food, and pharmaceutical industries is driving innovations in last mile logistics. Brick-and-mortar retailers and omnichannel retailing are leveraging cloud kitchens and food delivery platforms for efficient route optimization and delivery to the customer's doorstep. Company costs and shipping costs are a concern, with innovations in transportation hubs, warehouses, and delivery destinations aiming to streamline the process. Peer-to-peer marketplaces and non-autonomous technology are also playing a role in the evolving last mile delivery ecosystem. The internet and online shopping continue to shape product delivery services, with ground delivery vehicles adapting to meet the demands of various industries. This supply chain model is already being utilized by major medical device companies across North America and is expected to grow further, which, in turn, will drive market growth and trends during the forecast period.
The operational challenges faced by companies are hindering market growth. In the market, consumer expectations for real-time tracking and on-demand services have intensified competition among providers. Urban congestion adds complexity to the logistics process, leading to higher costs for ground delivery vehicles. Sustainability considerations are increasingly important, with companies exploring autonomous vehicles, drones, and route optimization to reduce fuel consumption and labor costs.
Moreover, peer-to-peer marketplaces and technology insights from autonomous and non-autonomous technology are transforming the last mile delivery landscape. Brick-and-mortar retailers, food industry, e-commerce, pharmaceutical industry, and other sectors rely on efficient last mile logistics to meet customer demands and reduce shipping costs. Innovations such as mobile applications, cloud kitchens, food delivery platforms, and warehouse optimization are key to providing a superior customer experience and staying competitive in the market. Thus, the operational challenges faced by last mile delivery companies are expected to impede the growth of the market during the forecast period.
The market research and growth 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 market growth and forecasting report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies 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.
The market growth analysis report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies 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 companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
The last mile delivery refers to the final leg of the supply chain, from the transportation hub to the consumer's doorstep. This critical stage of the delivery process has gained significant attention in the marketing world due to its impact on customer experience and satisfaction. Consumer expectations for fast, reliable, and convenient delivery have escalated, leading companies to invest in various strategies to optimize their last mile delivery operations. These include the use of technologies such as real-time tracking, on-demand delivery, and automation. On-demand delivery services like Uber Eats and Amazon Prime Now have disrupted traditional delivery models, setting new standards for speed and convenience. The use of urban logistics solutions, such as micro-fulfillment centers and delivery drones, is also gaining popularity to reduce delivery times and costs. The logistics industry is continuously exploring new ways to improve last mile delivery, with the ultimate goal of providing a seamless and satisfying experience for consumers.
Market Scope |
|
Report Coverage |
Details |
Page number |
172 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.12% |
Market Growth 2024-2028 |
USD 60.82 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
5.68 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 46% |
Key countries |
US, China, India, Germany, and UK |
Competitive landscape |
Leading Companies, market report, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Accenture Plc, CMA CGM SA Group, Deutsche Bahn AG, Deutsche Post AG, DSV AS, FarEye Technologies Inc., FedEx Corp., FM LOGISTIC CORP, Honeywell International Inc., Infosys Ltd., J B Hunt Transport Services Inc., Kuehne Nagel Management AG, Mara Labs Inc., Nippon Express Holdings Inc., Royal Mail Plc, Schneider Electric SE, SNCF Group, United Parcel Service Inc., Werner Enterprises Inc., and XPO Inc. |
Market dynamics |
Parent market analysis, market forecast, market analysis and report, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
Customization purview |
If our market forecasting 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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