Retail Logistics Market Size, Share & Trends Analysis Report By Type (Conventional Retail Logistics, E-commerce Retail Logistics), By Solution, By Mode Of Transport, By Region, And Segment Forecasts, 2022 - 2030

Report Overview

The global retail logistics market size was valued at USD 227.61 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 12.3% from 2022 to 2030. Due to increased worldwide trade activity, particularly in emerging economies, and global transportation infrastructure expansion, the market is likely to rise incrementally. The retail logistics system ensures a smooth flow of durable and non-durable goods to customers. Furthermore, logistics has resulted in quicker delivery times, lower fulfillment costs, and a more significant opportunity to focus on customer care rather than administrative operations in the retail industry.

As a result of increased globalization, international retailers have grown fiercely competitive. International retailers constructing new outlets in developing economies such as Asia Pacific, face fierce competition. This is causing a rise in economic activity and making transportation between regions easier. Hence, the demand for retail and logistic services to speed product delivery has increased. International retailing helps countries improve their economies by increasing tax revenue through importing and exporting commodities, which contributes to market growth. Similarly, the growing use of the internet has increased the number of trade and e-commerce opportunities available to international retailers.

Multimodal transportation has gained significant traction due to lowered costs per vehicle, decreased cargo-handling time, and reduced customs controls. Inclination to opt for multiple means of transportation is one of the significant trends in the retail logistics market. It involves using a combination of trucks, ships, railcars, or aircraft. Integrating this multimodal transportation allows for minimizing inventory costs and enables inventory operators to control the merchandise costs. Multimodal transportation helps merchants transfer goods efficiently and affordably during outbound logistics.

Furthermore, the retail e-commerce market's last-mile delivery strategy is predicted to boost the retail logistics business in near future. Customers can evaluate products from several online sources, which is a disadvantage for distributors or brick-and-mortar businesses because an e-commerce platform allows them to compare products based on delivery time, prices, features, specs, and compatibility requirements. These advantages over brick-and-mortar stores are propelling the retail e-commerce industry forward, and this trend is projected to continue in the future years.

The ongoing COVID-19 outbreak has taken a severe toll on the global economy in three ways:

• Drying up financial reserves and cash flows

• Suppressing profitability

• Affecting production and demand directly

Retail logistics companies have been largely affected by the COVID-19 pandemic. Due to a lack of manpower and supply chain disruptions during the pandemic's early stages (Q1 and Q2), the industry faced a temporary dip. Later, as consumers eschewed in-store purchases favoring internet shopping, the rise in online purchases increased the burden on retail logistics companies' distribution and logistical services. 

Type Insights

The conventional type segment held the largest revenue share of over 55% in 2021. The high percentage is due to the growing use of traditional retail logistics services by consumers who have limited reliance on the internet and hence prefer to shop in conventional retail establishments. It has been discovered that approximately 36% of shoppers prefer to purchase things from traditional retail outlets after researching them online. The buyers can pick up and check a product in a retail store. It also delivers immediate gratification because customers can purchase a thing without waiting for it to be delivered.

The e-commerce retail logistics segment is estimated to register the highest CAGR of 13.0% from 2022 to 2030. The growth is primarily attributable to the global spread of the coronavirus pandemic, which resulted in a surge in sales for e-commerce portals. Furthermore, rising internet penetration, combined with perks such as easy and free returns/exchanges, fast delivery, lower shipping costs, and a vast product selection, contribute to e-commerce retail's rapid rise.

As a result, logistics companies invest in enhancing and diversifying their services to meet the fast-rising e-commerce sector. FedEx, for example, announced the acquisition of ShopRunner, an e-commerce platform, in December 2020. The purchase was made to allow FedEx to utilize ShopRunner's e-commerce capabilities, allowing it to expand its e-commerce portfolio and client base.

Solution Insights

The supply chain solutions segment accounted for the largest revenue share of over 35% in 2021 and is expected to continue its dominance over the forecast period. The supply chain ensures on-time delivery, optimizes Omni channel operations, personalizes kitting and order fulfillment, and manages customer returns efficiently. It also allows for quick direct-to-consumer and direct-to-store shipment, boosting warehouse efficiency and inventory management. The segment is expected to register the fastest CAGR of over 13.8% from 2022 to 2030, owing to the growing usage of cloud-based supply chain systems, which assist track and optimize transportation and managing returns.

Over the projection period, the reverse logistics and liquidation segment is expected to witness significant growth. The booming e-commerce business, combined with an increase in the number of e-shoppers, is driving the demand for reliable reverse logistics services. Customers are increasingly favoring simple and quick returns/exchanges, so retailers aim to ease the process of replacing online goods that are simple and convenient for customers. This factor is expected to contribute to the growth of the segment in near future.

Mode of Transport Insights

The roadways mode of transport segment held the largest revenue share of over 52% in 2021 and is expected to dominate over the forecast period. Increasing demand for roadway vehicles to transport retail goods over long distances, especially in domestic regions, has increased the growth of the roadways segment. Trucks and cargos with large carrying capacities make a better choice for retail companies to opt for road transport. Several government measures encourage growth. For example, the Federal Motor Carrier Safety Administration's recent regulations promote the use of cameras to substitute rearview mirrors to increase the safety of truck drivers.

Furthermore, increased road connectivity in developing countries and excellent road connectivity across all developed countries is a crucial element driving the growth of the highway mode of the transportation segment. Most tier 2 and tier 3 cities in various nations are well connected by roadways, making delivery and pick-up of products accessible for retail logistics companies. Due to developments in road transportation systems and the improvement of highways around the world, this trend is projected to continue in the forthcoming years.

Regional Insights

Asia Pacific accounted for the largest revenue share of 26.3% in 2021. The region is home to a vast customer base and has witnessed significant adoption of e-commerce channels by individuals. China, Japan, Australia, and India are among the leading item exporters, accounting for a considerable share of worldwide retail e-commerce sales. As a result, the region's promising e-commerce growth prospects are the primary drivers of regional market expansion.

Other factors projected to fuel regional market expansion include a growing focus on transportation methods and ongoing logistics infrastructure upgrades in emerging countries. For example, the Ministry of Road Transport & Highways (MoRTH) is developing multimodal logistics parks to solve underdeveloped road and material handling infrastructure as part of the Indian Government's Logistics Efficiency Enhancement Program (LEEP).

North America held a significant revenue share of the market in 2021. The presence of numerous prominent competitors such as United Parcel Service of America, Inc., XPO Logistics, Inc., FedEx, Ryder System Inc., C.H. Robinson Worldwide, Inc., and Expeditors International of Washington, Inc. is helping to drive the growth of the regional market.

Key Companies & Market Share Insights

Major players operating in the market are expanding their service portfolios, forming partnerships, and merging and acquiring small and medium-sized businesses to expand their customer base. For instance, in April 2020, FedEx partnered with an open SaaS e-commerce platform provider, BigCommerce Pty. Ltd., enabling small and medium enterprises to sell online and connect to commerce and delivery. This collaboration has allowed the customers of BigCommerce Pty. Ltd. can now use FedEx shipping services within the existing platform at a low cost and with ease. Some prominent players in the global retail logistics market include:

• XPO Logistics, Inc.

• DSV

• Kuehne + Nagel International

• C.H. Robinson Worldwide, Inc.

• Nippon Express

• FedEx

• Schneider

• United Parcel Service

• APL Logistics Ltd

• DHL International GmbH

• A.P. Moller - Maersk

Retail Logistics Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global retail logistics market report based on type, solution, mode of transport, and region:

• Type Outlook (Revenue, USD Billion, 2017 - 2030)

  • Conventional Retail Logistics

  • E-commerce Retail Logistics

• Solution Outlook (Revenue, USD Billion, 2017 - 2030)

  • Commerce Enablement

  • Supply Chain Solutions

  • Reverse Logistics & Liquidation

  • Transportation Management

  • Others

• Mode of Transport Outlook (Revenue, USD Billion, 2017 - 2030)

  • Railways

  • Airways

  • Roadways

  • Waterways

• Regional Outlook (Revenue, USD Billion, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • U.K.

    • France

  • Asia Pacific

    • China

    • India

    • Japan

    • Australia

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa