India Last Mile Delivery Market 2021-2026

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    Published- March 2022

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    INDIA LAST MILE DELIVERY MARKET

     

    KEY FINDINGS

    1. Indian Last Mile Delivery market which was estimated at $XXB in 2021 is expected to witness a growth rate of 77% i.e., $XXB in 2027
    2. Transportation cost represents approximately ~40 to 50 percent of total logistic costs and 4 to 10 percent of the product selling price for many FMCG companies.
    3. Tier-1 cites will continue to be largest contributor, driven by overall e-commerce sector (FMCG, Pharma and Apparel)
    4. The tier-2 & tier-3 cities is expected to have higher growth rate compared to tier-1 cities, due to increased services of online players in these cities
    5. Trend of online apparel shopping is gaining prominence in India’s smaller cities, with 118% growth coming from tier-2 cities and over 192% order volume growth from tier-3 cities.
    6. The top 5 players, Allcargo Logistics, Mahindra Logistics, Delhivery, Blue Dart and Indian Post account for ~33.8% of the market share in terms of value.
    7. E-commerce giants Amazon India & Flipkart have been operating about 80-90% of the last mile delivery through their home grown services Amazon Transportation and Ekart Logistics.
    8. In March 2022, Electric two-wheeler startup Yulu planned to raise up to $100 million to expand its business model and grab a larger pie of the growing last-mile mobility segment.

     

    INTRODUCTION

    The last mile logistics stage of the delivery process is the most time consuming and expensive. One of the most difficult difficulties for most businesses is dealing with the competitiveness of E-commerce in the face of continually altering customer demand.

     

    Furthermore, last mile delivery performance has become the most important component in the relationship between E-commerce shop and end consumer, as it may either develop or break the bond, which has a direct impact on the client’s reordering choice.

     

    Customers now have a plethora of online purchasing choices to choose from. As a result, merchants put pressure on last-mile service providers to improve their performance.

     

    The transfer of people and commodities from a transportation hub to a final destination in the house is referred to as the last mile (LM) in supply chain management and transportation planning [Wikipedia].

     

    The cost per parcel in rural regions is significant. Retailers, LM service providers, and customers are the essential players in last mile logistics.

     

    Sometimes the store conducts the last mile delivery itself, while others outsource that stage to a third-party logistics provider (3PL).

     

     

     

    infographic: India Last Mile Delivery Market, India Last Mile Delivery Market Size, India Last Mile Delivery Market Trends, India Last Mile Delivery Market Forecast, India Last Mile Delivery Market Risks, India Last Mile Delivery Market Report, India Last Mile Delivery Market Share

     

     

    The “Last mile” is a logistical concept that entails tailored methods to guarantee that final delivery is both comfortable and efficient for clients.

     

    The most expensive and time-consuming element of the shipping process is last mile delivery. The “last mile” delivery, which accounts for 30% of overall E-logistics costs, became one of E-bottlenecks. commerce’s

     

     

    INDIA LAST MILE DELIVERY MARKET DYNAMICS

     

     

    SI No Timeline Developments
    1 Q4-2021 In 2021, there were about 22 million sq feet of land occupied for warehousing and industrial facilities in the top 5 cities, propelled by robust warehousing demand from the E-commerce segment and strong production growth
    2 Q4-2021 Various D-2-C platforms opted for 3rd Party Logistics provider Bluedart, Delhivery and DTDC to send inter-state shipments
    3 Q4-2021 The average order value of online ordered food has dropped significantly during the last 6 months. It has dropped from ~$6.5 to ~$5 in this period
    4 Q4-2021 Last mile delivery startup QuickShift opened its second fulfillment center at Bengaluru, to support its warehouse fulfillment, last mile delivery, logistics services in south regions.
    5 Q4-2021 FedEx entered the Indian market by investing $100 million Delhivery to assist its operations with a long term agreement. FedEx operates international logistics operations from India and Delhivery will assist FedEx by providing services in pickup, deliveries and return of products in India.
    6 Q4-2021 The last mile logistics companies are partnering with EV manufacturers to deploy EVs in the delivery services to reduce emissions under sustainability development.

     


    In the previous several decades, India has seen a tremendous upheaval in the delivery environment. The increased need for local goods, combined with an unexpected surge in hyperlocal entrepreneurs, has given rise to a new delivery sector, the hyperlocal or last mile delivery ecosystem.

     

    As part of their environmental goals, e-commerce corporations and third-party logistics providers are pledging to include electric cars in their fleets. Amazon India said in January 2020 that it will integrate 10,000 EVs (both 3Ws and 4Ws) in its delivery truck fleet by 2025.

     

    The India Last Mile Delivery Market is served by traditional logistics service providers (LSPs), e-commerce store logistics providers, and captive logistical arms.

     

    In recent years, dedicated LSPs for e-commerce transactions have entered the market, utilising a technology-centric approach that allows the firms to develop facilities and systems, and still provide affordable prices to customers.

     

    Logistics is critical in e-commerce retail. There has been a substantial amount of investment, with foreign corporations viewing India as a promising market.

     

    infographic: India Last Mile Delivery Market, India Last Mile Delivery Market Size, India Last Mile Delivery Market Trends, India Last Mile Delivery Market Forecast, India Last Mile Delivery Market Risks, India Last Mile Delivery Market Report, India Last Mile Delivery Market Share

     

    Furthermore, as the e-commerce retail industry transforms, with a greater proportion of demand projected from tier II and tier III cities and air to surface movement, current players are searching for novel concepts to improve end-to-end logistics.

     

    Pack Stations or Parcel Lockers are a Western concept that is gaining traction in India. This kind of Last Mile delivery is more appropriate for B2C shipments because the cargo is intended for an individual client who is gone on business during the day.

     

    The parcel station is kept in a strategic place in a densely populated region, is easily accessible 24 hours a day, and the consignee may come and receive the cargo on their own.

     

    For the convenience of customers, parcel lockers might be built in major metro stations or near shopping malls.

     

     

    INDIA LAST MILE DELIVERY MARKET SEGMENTATION

    The India Last Mile Delivery Market can be segmented into following categories for further analysis.

    By Application

    • Residential Application
    • Commercial Application
    • Industrial Application

     

    By Integration / Structure Type

    • Private Partnership Only
    • Public Private Partnership
    • Program based Public Private Partnership

     

    By Regional Classification

    • Western Region – India
    • Eastern Region – India
    • Southern Region – India
    • Northern Region – India

     

    RECENT TRENDS IN INDIA LAST MILE DELIVERY MARKET

     

    Sl No Timeline Company Developments
    1 Dec-2021 Zypp Electric Zypp Electric partnered with Flo Mobility to expand its footprint in the autonomous electric vehicles space, with the collaboration focusing on last-mile deliveries in the Delhi-NCR region
    2 Dec-2021 Shiprocket Shiprocket partnered with CommerceUp an end-to-end SaaS e-commerce company to provide integrated solutions to online e-commerce businesses
    3 Q1-2022 Borzo Delivery service company Borzo acquired the India based last mile delivery service startup NOW to strengthen its position in India and offer more delivery options to its customers.
    4 Q1-2022 ShipRocket ShipRocket is a eCommerce shipping and enablement platform provider India owned by Zomato, ShipRocket acquired logistics aggregator platform Rocketbox.
    5 Q1-2022 Zypp Electric Hyperlocal and EV based last-mile delivery startup Zypp Electric will use drones for its last mile deliveries by partnering with TSAW drones.
    6 Q4-2021 Dunzo Last mile delivery company Dunzo will deliver orders using drones after getting permission from the government.
    7 Q4-2021 BattWheelz Mobility Last mile delivery startup BattWheelz Mobility partnered with Hero Electric to use electric vehicles in last mile delivery services. Hero will supply 4000 electric vehicles by FY 2022-23 for the last mile delivery mobility solutions.
    8 Feb-2021 Amazon Amazon will deploy 10,000 of Mahindra’s electric three-wheeler Treo Zor in the country by 2025.

    As of Feb 2021, around a hundred of them have already been deployed into service in seven cities in the country like New Delhi, Bengaluru and Hyderabad

     


    Final mile delivery may also be thought of as the point at which the last mile meets the recipient. Last mile delivery and last mile transportation are inextricably linked and, as a result, are frequently studied in tandem.

     

    The majority of the funds are allocated to developing technologies and innovations, notably goods reception solutions.

     

    The Internet of Things improves the availability of critical package information such as parcel contents, parcel position in the supply chain, and parcel arrival. It also allows for speedier information flow in the supply chain, which improves customer satisfaction.

     

    It links numerous technical devices (such as cars, loading and unloading equipment, and so on) to one another via sensors mounted on these devices, allowing for real-time monitoring of vital parameters such as temperature, filing rate, and so on.

     

     

    infographic: India Last Mile Delivery Market, India Last Mile Delivery Market Size, India Last Mile Delivery Market Trends, India Last Mile Delivery Market Forecast, India Last Mile Delivery Market Risks, India Last Mile Delivery Market Report, India Last Mile Delivery Market Share

     

    One of the primary areas of concentration in becoming a Digital India is the development of a new era addressing system for the country.

     

    One of the most significant advancements is the digitization of addresses in order to synchronise physical addresses with current technologies. As a result, India has seen the emergence of a number of firms concentrating on address digitization.

     

    This is predicted to provide a variety of benefits, including, but not limited to, reduced transit time, fewer delivery attempts, fewer customer-initiated returns, and enhanced last-mile delivery accuracy.

     

     

    INDIA LAST MILE DELIVERY MARKET COMPETITIVE LANDSCAPE

     

    SI No Timeline Company Developments
    1 Feb-2022 Mahindra Logistics Mahindra Logistics, acquired a majority stake in ZipZap Logistics, a last-mile logistics service provider that operates under its brand ‘Whizzard.’ Mahindra will acquire 60% for Rs 71.73 crore in two phases.
    2 Jan-2022 Hero Electric Hero Electric partnered with Turtle Mobility, a start-up offering last-mile delivery connectivity solutions to e-commerce and grocery companies. Hero is expected to deliver more than 1,000 e-scooters to the startup
    3 Aug-2021 The Fuel Delivery App based door-to-door fuel delivery service provider, “The Fuel Delivery” launched its services in 3rd city, Bangalore. The services are available in New Delhi & Mumbai
    4 Dec-2021 Swiggy India’s Food delivery giant Swiggy reported a 23% fall year-on-year in revenue at Rs 2,145 crore ($280M) in FY-21
    5 Q4-2021 Delhivery Delhivery acquired Spoton Logistics to expand its delivery business and filed for a $500 million IPO. FedEx acquired minority stakes in Delhivery.
    6 Q4-2021 Yodacart Last mile logistics and same-day delivery startup Yodacart raised USD 225,000 to expand its presence in the Indian market.
    7 Q3-2021 Blue Dart Express Blue Dart Express Indian logistics company, generated revenue of ₹872.81 Crore in the 2nd quarter of 2021.
    8 Q3-2021 Zypp Electric Last mile delivery startup, Zypp Electric raised $7 million from its Series A round for its business expansion.

     

    E-commerce and fast moving consumer goods (FMCG) account for roughly 70% of the last mile delivery business, which comprises the movement of products within 200 kilometres with a round trip time of less than 24 hours and a load weight of less than 5 tonnes.

     

    Porter, LetsTransport, Blowhorn, and Lynk are the market leaders in the intra-city category.

     

    Over the last year, e-commerce behemoths such as Amazon, Flipkart, and Reliance have collaborated with third-party players, SMEs, and neighbourhood retailers, as well as employed hundreds of delivery executives to efficiently manage last-mile deliveries.

     

    The businesses have also planned strategies to improve their delivery capacities through contactless solutions.

     

    infographic: India Last Mile Delivery Market, India Last Mile Delivery Market Size, India Last Mile Delivery Market Trends, India Last Mile Delivery Market Forecast, India Last Mile Delivery Market Risks, India Last Mile Delivery Market Report, India Last Mile Delivery Market Share

     

    IKEA plans to be completely electric in terms of transportation by 2030. Their Hyderabad shop was the first of its kind in India to use electric cars to carry small cargo to customers’ houses.

     

    Flipkart has pledged to replace 40% of its delivery fleet with electric vehicles. For almost a year, companies such as Amazon, Big Basket, Grofers, and Swiggy have used electric cars for home deliveries.

     

    INDIA LAST MILE DELIVERY MARKET COMPANIES PROFILED

     

     

    THIS INDIA LAST MILE DELIVERY MARKET REPORT WILL ANSWER FOLLOWING QUESTIONS

    1. India Last Mile Delivery Market size and Forecast, by region, by application
    2. Average B-2-B price for India Last Mile Delivery Market, by region, per user
    3. Technology trends and related opportunity for new India Last Mile Delivery Market tech suppliers
    4. India Last Mile Delivery Market share of leading vendors, by region,
    5.  Coronavirus impact on India Last Mile Delivery Market earnings
    Sl no Topic
    1 Market Segmentation
    2 Scope of the report
    3 Abbreviations
    4 Research Methodology
    5 Executive Summary
    6 Introduction
    7 Insights from Industry stakeholders
    8 Cost breakdown of Product by sub-components and average profit margin
    9 Disruptive innovation in the Industry
    10 Technology trends in the Industry
    11 Consumer trends in the industry
    12 Recent Production Milestones
    13 Component Manufacturing in US, EU and China
    14 COVID-19 impact on overall market
    15 COVID-19 impact on Production of components
    16 COVID-19 impact on Point of sale
    17 Market Segmentation, Dynamics and Forecast by Geography, 2021-2026
    18 Market Segmentation, Dynamics and Forecast by Product Type, 2021-2026
    19 Market Segmentation, Dynamics and Forecast by Application, 2021-2026
    20 Market Segmentation, Dynamics and Forecast by End use, 2021-2026
    21 Product installation rate by OEM, 2021
    22 Incline/Decline in Average B-2-B selling price in past 5 years
    23 Competition from substitute products
    24 Gross margin and average profitability of suppliers
    25 New product development in past 12 months
    26 M&A in past 12 months
    27 Growth strategy of leading players
    28 Market share of vendors, 2021
    29 Company Profiles
    30 Unmet needs and opportunity for new suppliers
    31 Conclusion
    32 Appendix

     

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