Retailers to spend profits to optimise delivery, logistics

17 Jan '20

2 min read

Pic: Shutterstock

Total e-commerce revenue in 2020 will reach $3.52 trillion, which will force retailers to find faster and better modes to reach the final mile and yard, according to global tech market advisory firm ABI Research, which has identified 35 trends that will shape the technology market and 19 others that look less likely to move the needle over the next 12 months.

“After a tumultuous 2019 that was beset by many challenges, both integral to technology markets and derived from global market dynamics, 2020 looks set to be equally challenging,” said Stuart Carlaw, chief research officer at ABI Research in a recent whitepaper, titled ‘54 Technology Trends to Watch in 2020’.

The company forecasts total e-commerce revenue will grow year on year (YoY) at nearly 19 per cent and this depends on ever faster and more convenient modes to reach the final mile and yard in suburban and urban markets, as well as share in rural areas, said Susan Beardslee, freight transportation and logistics principal analyst at US-based ABI Research.

This includes the increase of one-day delivery and seven-days-a-week delivery in 2020 to reduce ‘click-to-door’ time and combat the Amazon effect. There is increasing convergence of online and in-store businesses, with brick and mortar positioned as hubs closer to the customer, as well as e-commerce sites directing package delivery to retail outlets. Additive investment will grow in Buy Online Pay in Store (BOPIS) options, the company said in a press release.

China giants Alibaba and JD.com now have greater focus on growth through lower-tier cities, chasing fast growing, third place Pinduoduo’s rural playbook to reach the next 600 million people. Singles Day in China for 2020 will surpass not only all of the US retail holidays, but 2019’s record-setting $38.4 billion for Alibaba alone, at a 26 per cent increase YoY.

Retailers need to address their increasing costs and consumer expectations through new business models and optimised transportation and logistics methods.

Fibre2Fashion News Desk (DS)

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