E-commerce – changing how logistics is done

[Source transportintelligence.com – C. Roberson] When asked his thoughts on e-commerce in 1996, Steve Jobs, CEO of Apple simply said, “It’s going to be huge.” Indeed, e-commerce is huge and with it, the logistics needed to keep it going. Estimated at over €140bn, e-commerce logistics is rapidly changing to try to keep pace with this quickly evolving e-commerce market. Ti’s latest report, Global e-commerce Logistics 2015 provides an analysis of the trends and challenges facing the supply chain.

Mobile commerce (m-commerce), alternative payments, cross-border and the ‘shared economy’ are among the many trends affecting e-commerce and its logistics. Logistics providers are responding in varying ways by offering more delivery options, more alternative delivery locations and utilizing technology to provide such services as real-time tracking and visibility.

At the same time, retailers are investing in e-commerce logistics such as establishing e-fulfillment centres and creating a multichannel experience for consumers.

Of course there have been hiccups along the way as evident during the past two holiday seasons as well as the ‘free shipping’ concept. As such a collision is imminent as some retailers take on traits of logistics providers. Amazon is perhaps the biggest example of this. But it is not alone, what about eBay, Alibaba, Google and even Walmart?

Meanwhile, phenomenal growth is occurring in every geographic region. Even though North America is currently the largest e-commerce logistics market this is expected to change in 2015 as Asia-Pacific takes the crown. Led by China which is the market share leader with over 60% of Asia-Pacific’s e-commerce logistics, India is finally showing signs of long anticipated growth.

The rapid adoption of cheap mobile devices is further stirring growth in Africa and South America. The Middle East is also witnessing unprecedented growth in e-commerce and the logistics associated with it. Likewise, even in mature e-commerce markets as the US and Europe, logistics needs are expected to grow as well.

What does the future hold for e-commerce logistics? If it’s anything like the almost 20 years since Steve Jobs’ quote, there will certainly be plenty more innovations to impact the supply chain as we know it. But, as Ti’s CEO, John Manners-Bell cautions, “It is inevitable that the e-commerce logistics market will experience a major shake-up in the next few years. There will have to be more consolidation – more companies will go out of business and there will be future mergers.”