The India e-commerce logistics industry is growing at a rapid rate given the funding by global investors. The e-commerce focused LSPs have gained huge traction in the last couple of years, for example players like Delhivery and Ecom have already crossed a revenue mark of Rs. 350 crore individually. These emerging LSPs providing complete logistics solution to e-retail industry includes services like first mile, last mile, COD collection, remittance, parcel tracking, etc. These e-commerce focused LSPs are continuously adopting new technologies and constantly making efforts to welcome new requirements given by e-commerce companies. Meanwhile, traditional LSPs have an advantage of established network and reach, along with their experience and expertise in providing logistics service pan India. But due to lack of pattern followed to reach the client of e-commerce, along with the lack of sales techniques and IT adoption, has put these traditional LSPs to lose their ground on e-commerce logistics platform.
According to recently published report of Bonafide Research 'India E-Commerce Logistics Market Outlook, 2022' e-commerce logistics market has crossed a revenue mark of Rs. 5,000 crore in FY 2016-17. Increasing e-retail industry has augmented the demand of LSPs for distribution and reach. In distribution channel, e-commerce package in India is handled by at least 18 people before it reaches its final destination, whereas in a developed country a package would be touched by about 3-5 people. Earlier to e-commerce, the domestic express service market was largely unorganized and fragmented. The existing traditional 3PL players had limited capabilities to cater to time sensitive delivery and service levels demanded by e-commerce players, which resulted into captive logistics arms being seeded by the large e-com players. Maximum of deliveries for Amazon and Flipkart are executed through their respective captive logistics entities. In last 3-4 years, 3PL players have emerged to take advantage of scale and efficiency through a technology first approach. Within the 3PL LSP market, e-commerce focussed players like Ecom Express, Delhivery and GoJavas have more than 30% market share. Both types of LSPs, captive and third party, are looking to expand their capabilities through calculated investments. Also, large e-commerce vendors have made strategic investments in other logistics players in this critical market and have invested in start-ups too. In complex categories such as furniture, jewellery and grocery, e-commerce players still largely rely on captive logistics.
Report Link: https://www.bonafideresearch.com/product/171050021/India-E,Commerce-Logistics-Market-Outlook,-2022
In e-commerce logistics, last mile and line haul contribute major part of the logistics cost for players. Major part of line haul is by air due to time sensitive nature and service commitment. E-commerce growth over the next 5 years will be driven by demand from tier-II cities and beyond. Shipment volume will increase majorly in the forecast period. The challenge is that the demand from tier-II cities and beyond will be highly disaggregated because it will be originating from more than 4,500 small cities and town. Building a scalable and efficient logistics network for such scattered demand and supply will require innovative business models from logistics players.
Companies in this report are divided into three sections: Gati Limited, Blue Dart Express Limited, FedEx Express Transportation & Supply Chain Services (India) Pvt. Ltd., Safexpress Private Limited, Future Supply Chain Solutions Limited, First Flight Couriers Limited, Aramex India Private Limited and Indian Postal Services are major traditional logistics service providers in India. Major companies in e-commerce focused logistics service provider include Delhivery Private Limited and Ecom Express Private Limited whereas Instakart Services Private Limited - Ekart and Pigeon Express Private limited - GoJavas are major captive logistics arms in India.
Report: India E-Commerce Logistics Market Outlook, 2022
Base Year: 2015-16
Estimated Year: 2016-17, Forecast Year: 2021-22
Pages: 122, Figures: 21, Tables: 32
Bonafide Research & Marketing Pvt. Ltd.
Steven Thomas – Sales & Marketing Manager
E-mail: [email protected]
Telephone: +91-265-2331309/ +91-7878231309