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‘Global e-commerce logistics market expected to grow at 9.69%’

Technavio forecasts a rapid growth in the global e-commerce logistics market driven by growth in the cross-border e-commerce market.

The “Global e-commerce logistics market 2016-2020” market research report from Technavio forecasts Global e-commerce logistics market growth at CAGR of 9.69% during the period 2016-2020

Impact of emerging markets.
Emerging markets have recorded an increase in foreign goods consumption and are driving the demand for e-commerce logistics. Over the next 5 years, China is expected to emerge as the largest market for online shopping, as their growing middle-class population increasingly spend on foreign products. In turn, the logistics market in China is predicted to exhibit significant growth and contribute to the overall revenue of the global e-commerce logistics market.

“While initially international transportation management was the primary service demanded, more recently, domestic value-added warehousing and distribution are also finding a positive reception in developing countries,” says Sharan Raj, a Technavio lead analysts.

Last-mile deliveries for e-commerce
Two types of warehouses are required for e-commerce logistics, small facilities for last-mile deliveries, and larger requirements serving regional e-fulfillment. Last-mile delivery facilities are located in proximity to city centers. Originally, logistics service providers focused on developing regional centers, but with the growing demand for same day deliveries, last-mile delivery centers have also gained traction.

To cater to constantly changing logistical requirements in the e-commerce industry, vendors are expanding existing networks or acquiring new ones.

In September 2015, Menlo Logistics partnered with real estate developer Prologis to build a distribution facility in the Netherlands. Their warehousing, distribution and fulfillment center will provide direct access to markets in neighboring countries such as Belgium and Germany. Technavio researchers predict strong demand for heavy-goods last-mile logistics, which will continue to drive the e-commerce logistics market in Europe and vendors will continue to expand their logistics capabilities, including technological capabilities, to accommodate customer requests for last-mile services.

Increasing technology investment
A major trend set to emerge in the e-commerce logistics market is increased investments in technology to help logistics service providers enhance delivery services and monitor movement of goods accurately given short lead times. The use of software technologies such as warehouse management software, automated material handling equipment, warehouse control software, and other evolving technologies, such as mobile technology, global positioning systems, trailer seals, RFID, and biometrics, is expected to help logistics providers maintain a balance in inventory levels and monitor products correctly.

For instance, in 2014, Deutsche Post DHL signed a five-year contract with the Escher Group for using a software, which will allow DPDHL to streamline its network by introducing easier collection and delivery of parcels in Germany. To augment further expansion, DPDHL has also invested in BravoAdvantage, a next-generation procurement platform BravoSolution, which provides the Deutsche Post DHL group an e-procurement platform that integrates five key areas of strategic sourcing: savings management, spend analysis, supplier relationship management, and sourcing and contract management.

Source: Logistics Management

Tags: global e-commerce, Logistics

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