BENGALURU: The last mile delivery sector in India is on a steady upward trajectory and is estimated to a market size of $6 billion by 2024, a report by research firm Redseer said. Even though the country has been in the grip of lockdowns over the past year where only the delivery of essentials have been permitted, e-commerce shipments have grown from 814 million in 2018 to 1.36 billion in 2020.
This number is expected to jump almost six-fold, signaling a shift in shopping behaviour. Intra-city logistics constitutes 18 per cent of the overall $320 billion industry. Logistics have remained a backbone for many industries and have enhanced technology-based offerings to suit various sectors and their needs, said Kanishka Mohan, Director at Redseer.
E-commerce and FMCG constitute nearly 70 per cent of the last mile delivery market, which includes the movement of goods within 200 kilometres with a round trip of less than 24 hours, and a load of less than 5 tonnes. In the intra-city segment, the market is dominated by players like such as Porter, LetsTransport, Blowhorn, and Lynk.
E-commerce biggies like Amazon, Flipkart, Reliance have tied with third-party players, SMEs, and neighbourhood stores, as well as hired thousands of delivery executives over the past year to efficiently executive last-mile deliveries. The companies have also strategised ways to boost their delivery capabilities through contactless offerings.
Mohan added that the last mile delivery sector in 2019 was a $ 800-900 million industry with a 3-4% penetration, but the industry is moving in a similar direction to markets like China and the US.