Latin America E-commerce Logistics - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

Latin America E-commerce Logistics - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Latin America E-commerce Logistics Market size is estimated at USD 5.75 billion in 2024, and is expected to reach USD 9.38 billion by 2029, growing at a CAGR of 10.30% during the forecast period (2024-2029).

Key Highlights

• The COVID-19 pandemic spurred significant growth in the digital realm in 2020, notably benefiting e-commerce. Latin America experienced exponential growth in online shopping, with several countries reporting substantial increases in online purchases, serving as a primary driver for the market.
• The Latin American e-commerce market stands as a global leader in growth, expected to surpass the global average of 14% (as reported in 2021), with an anticipated growth rate of 19% over the forecast period. This robust expansion offers immense opportunities for the e-commerce logistics market.
• The surge in demand for home delivery catalyzed the growth of specific e-commerce segments like food and beverage, which had been gaining popularity in recent years. The digitalization of shopping habits has transcended the initial impact of the coronavirus, becoming an increasingly entrenched aspect of people's daily lives.
• Several significant factors contribute to this market growth, including the rise of e-commerce businesses, the surge in sales, and technological advancements across Latin America. The proliferation of mobile internet usage has also played a pivotal role, enabling people to search for products more conveniently.
• Countries like Brazil, Argentina, and Chile heavily rely on road transportation for moving agricultural products and fertilizers across long distances. Thus, the dependence on efficient logistics and transportation networks ensures competitiveness, indicating a continual growth trajectory for the e-commerce logistics market in Latin America.

Latin America E-commerce Logistics 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 could be more active 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 catch up with its e-commerce hegemony.
• The online marketplace created in Argentina remains at the top of the 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 40% of online consumers prefer utilizing PayPal, and 38% use cash-on-delivery.
• 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 an 8-10% share of total retail sales in Latin America.
• Brazil and Mexico hold enormous potential for e-commerce in Latin America. There are currently 77.4 million e-commerce users in Brazil, with an additional 38.8 million estimated to be shopping online by the end of 2023. By comparison, there are 103.31 million internet users in Mexico, accounting for just under half of the population, leaving room for substantial growth.

Latin America E-commerce Logistics Industry Overview

The Latin American e-commerce logistics market is relatively 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 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 long-lasting customer relationships​.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support