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Latin America E-commerce Logistics Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022-2027)

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  • 200 Pages
  • August 2022
  • Region: Latin America
  • Mordor Intelligence
  • ID: 5332819
The Latin American e-commerce logistics market is expected to register a CAGR of more than 13% during the forecast period 2022-2027.

The COVID-19 pandemic encouraged growth in the digital world in 2020, with e-commerce being one of the biggest beneficiaries. The exponential growth of internet shopping throughout Latin America, with some countries reporting significant increases in online purchases, is one of the primary drivers of the market.

As a result, the Latin American e-commerce market is the global leader in e-commerce growth and is expected to grow by 19% over the forecast period, surpassing the global average of 11% (as reported in 2020), providing immense scope for growth of the e-commerce logistics market.

Last-mile delivery solutions in the region have become more attractive from an investment perspective due to the COVID-19 pandemic. For example, as reported in April 2020, 99 Minutos, a Mexico City-based company that provides last-mile delivery services and is backed by Engie’s corporate venture arm Engie Factory, was expected to raise USD 12 million to accelerate its regional expansion.

E-commerce sales in Latin America grew by 230% during the first weeks after the pandemic began. The massive demand for home delivery boosted the growth of e-commerce segments that had already been gaining popularity in recent years, such as food and beverage. The digitalization of shopping seems to have transcended the coronavirus onset, becoming an increasingly normal habit in people's everyday lives. According to a survey conducted at the end of 2020, at least eight out of ten Latin Americans surveyed said they would continue shopping online after the pandemic.

Key Market Trends

E-commerce Boom Spearheading Last-mile Delivery Demand

With a population of 386 million, there is an abundance of potential opportunities for e-commerce success in the region. While many would not expect growth in e-commerce during economic unrest, this surge mostly came from the rise in internet and smartphone usage, which provided access to goods from abroad that were previously out of reach.

E-commerce's rapid growth in Latin America faces a stubborn bottleneck offline with same-day deliveries. Reaching a customer's doorstep faster has drawn investors toward warehouses and fulfillment centers in dense city centers. However, moving goods in and out of mega metropolises like Mexico City or Sao Paulo is sluggish at best.

Van and small truck drivers drive on poor roads amid terrible traffic jams to make deliveries from large warehouses in the sprawling suburbs, often arriving late. While e-commerce companies have shaved delivery times from 7-10 days to 2-3 over the past few years, the target is to reach same-day deliveries.

Mercado Libre has played a leading role in developing the sector in Latin America. Although the third-party sales giant maintains a growing influence, many competitors are rising to the challenge of catching up with its e-commerce hegemony. However, no local competitor has been able to match the USD 1.7 billion generated by Mercado Libre in the second quarter of 2021. The online marketplace created in Argentina remains at the top of Latin America-born e-commerce companies list. Branching out to digital payments, Mercado Libre's Mercado Pago, its online payments service, processed a staggering USD 50 billion inside and outside the marketplace business model.

Digitization and Inclination Toward Online Transactions

To circumvent the logistical nightmare of a cash-based society, e-commerce providers targeting the region have found ways to manage this reality. About 36% of online consumers prefer utilizing PayPal, and 35% use cash-on-delivery, as reported in 2019. Moreover, the declining costs of internet services and data and the growing use of credit cards and digital payment systems have reduced the challenges to adopting online shopping. As a result, the sector has captured a 4-5% share of total retail sales in Latin America, as reported in March 2020.

Brazil and Mexico hold enormous potential for e-commerce in Latin America. There are currently 66.4 million e-commerce users in Brazil, with an additional 28.2 million estimated to be shopping online by the end of 2021. By comparison, there are 95.31 million internet users in Mexico, accounting for just under half of the population, leaving room for substantial growth.

Competitive Landscape

The Latin American e-commerce logistics market is fairly fragmented, with a mixture of domestic and international companies, including DHL, DB Schenker, and Kerry Logistics.

Growing e-commerce activities have led to a high frequency of large-scale deliveries across provinces, giving birth to logistics services specifically for e-commerce activities in the region. Since the e-commerce business environment has become more dynamic and competitive, companies tend to demand better logistics services that are flexible and cost-effective.​​ Value-added services, such as door delivery, real-time tracking, and others, have given a competitive advantage to logistics players who want to build a long-lasting relationship with their customers​.

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Table of Contents

1.1 Study Assumptions
1.2 Scope of the Study
2.1 Analysis Methodology
2.2 Research Phases Explained
4.1 Current Market Scenario
4.2 Technological Trends and Automation
4.3 Government Regulations and Initiatives
4.4 Supply Chain/Value Chain Analysis
4.5 Impact of COVID-19 on the Market
4.6 Insights into the E-commerce Market
4.7 Spotlight - Key Hubs for E-commerce Logistics
4.8 Insights into Reverse/Return Logistics
5.1 Market Drivers
5.2 Market Restraints/Challenges
5.3 Market Opportunities
5.4 Industry Attractiveness - Porter's Five Forces Analysis
5.4.1 Bargaining Power of Buyers/Consumers
5.4.2 Bargaining Power of Suppliers
5.4.3 Threat of New Entrants
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6.1 By Service
6.1.1 Transportation
6.1.2 Warehousing and Inventory Management
6.1.3 Value-added Services (Labeling, Packaging, etc.)
6.2 By Business
6.2.1 B2B (Business-to-Business)
6.2.2 B2C (Business-to-Customrs)
6.3 By Destination
6.3.1 Domestic
6.3.2 International/Cross-border
6.4 By Product
6.4.1 Fashion and Apparel
6.4.2 Consumer Electronics and Home Appliances
6.4.3 Beauty and Personal Care Products
6.4.4 Other Products (Toys, Food Products, Furniture, etc.)
6.5 By Country
6.5.1 Brazil
6.5.2 Mexico
6.5.3 Argentina
6.5.4 Colombia
6.5.5 Chile
6.5.6 Peru
6.5.7 Rest of Latin America
7.1 Market Concentration Overview
7.2 Company Profiles
7.2.1 DHL Express
7.2.2 FedEx Corporation
7.2.3 Bollore Logistics
7.2.4 DB Schenker
7.2.5 Gefco Logistics
7.2.6 CH Robinson Worldwide Inc.
7.2.7 CEVA Logistics
7.2.8 Kuehne Nagel
7.2.9 Nippon Express
7.2.10 Kerry Logistics
7.2.11 Loggi
7.2.12 B2W Digital*
7.3 Other Companies**
9.1 Macroeconomic Indicators (GDP Distribution by Activity, Contribution of Transport/Courier Sector to Economy)
9.2 Key Statistics Related to Retail and E-commerce Sectors (such as Sales/Revenue, Consumer Preferences, etc.)

Companies Mentioned

A selection of companies mentioned in this report includes:

  • DHL Express
  • FedEx Corporation
  • Bollore Logistics
  • DB Schenker
  • Gefco Logistics
  • CH Robinson Worldwide Inc.
  • CEVA Logistics
  • Kuehne Nagel
  • Nippon Express
  • Kerry Logistics
  • Loggi
  • B2W Digital*