Five keys to understanding the new challenges of ecommerce logistics

Logistics and last-mile delivery for e-commerce is facing new challenges after the slowdown that 2022 has meant for the progress of e-commerce. These are some of the keys to how a sector is evolving in which large logistics operators and parcel networks coexist with new specialists with a high technological component and focused on sustainability.

1. E-commerce involving shipments is slowing down: after double-digit growth in 2019, 2020 and 2021, the number of online product purchase transactions slowed down significantly in 2022. In this regard, the CNMC’s Annual Report on the Postal Sector 2022 points to a 4.4% drop in the number of postal parcels sent. Behind this decline would be the return to normality of offline commerce and inflation.

2. Costs are rising and access to finance is tightening: fuel, electricity, labour costs…. all inputs have risen, especially on the last mile delivery side. Moreover, backing from financial backers for new start-ups is falling in a context of rising rates, which offer investors more secure returns. This has led to the first casualties in the sector, with Llewo and Vamox being two of the most prominent.

3. More competition: However, despite the slowdown, which many believe to be cyclical, new initiatives continue to emerge, especially in the area of fulfilment. Of particular note is the interest awakened by the Spanish market for international logistics companies (Hive, Byrd, Huboo….), which are seeking to attract Spanish customers by offering to facilitate their marketing abroad and vice versa.

4. Between outsourcing and insourcing: In this context, large FMCG retailers are moving towards greater control of their ecommerce logistics, at least in terms of stock and order preparation, with several warehouse centre projects underway. In this sense, the Chinese marketplace Aliexpress, through its logistics division Cainiao, is strengthening its presence in Spain to shorten delivery times and gain in efficiency.

5. Delivery points and more technology: In-store pick-up and lockers continue to gain popularity among Spanish shoppers and, according to the latest CNMC Household Panel, 15.3% of shoppers choose a physical shop to pick up their parcels and 9.2% choose a smart locker. This represents an opportunity for logistics companies that decide to strengthen this alternative to home delivery. An alternative, moreover, considered more efficient and environmentally friendly. Likewise, new technologies applied to both warehouse management and delivery continue to gain importance, especially in the field of real-time route control and monitoring, direct communication between the delivery person and the buyer, and returns management.

All these points are exhaustively analysed in the 2023 Report on ecommerce logistics and last mile distribution recently published by Alimarket Logística, which you can access here.