E-commerce Fulfillment Services Market Growth & Trends

The global e-commerce fulfillment services market size is anticipated to reach USD 113.59 billion by 2027, expanding at a CAGR of 6.5% from 2020 to 2027, according to a new report by Grand View Research, Inc. The rapid penetration of internet services and the resulting rise in the number of online shoppers is the major factor driving demand for e-commerce fulfillment services worldwide. The consumer expectations with regards to delivery time, shipping speed, and associated costs are changing rapidly. The major reason for consumers abandoning online shopping carts includes delayed shipping. Therefore, established merchants such as Amazon.com, Inc. have started delivering orders in the shortest turnaround time, in some cases within an hour across large cities. This has been possible only because of the strategic location and positioning of fulfillment service centers.

The growing demand for the shorter delivery period has augmented the need for micro warehouses with a wide geographical presence to ensure the order reaches the end-user in a short period. Picking and bundling play a vital role in fulfilling consumer demand for rapid delivery. Automated packaging and labeling solutions used at fulfillment centers help staff sort, locate, seal, package, and label products in relatively lesser time, thereby accelerating the delivery process.

Over the years, e-commerce fulfillment service companies have gained significant momentum, especially with the rise in the number of e-commerce startups and fast-growing small & medium-sized enterprises worldwide. These startups do not have established distribution networks and robust logistics or transportation infrastructure owing to which they extensively depend on third-party fulfillment service providers. However, service providers including ShipBob, Inc., ShipMonk, Red Stag Fulfillment, and Radial, among others are now providing a full suite of e-commerce fulfillment services including picking, packaging, warehousing, shipping, and reverse logistics like Amazon.com, Inc. Therefore, the advent of new businesses in the e-commerce market space is anticipated to boost the market growth over the forecast period.

E-commerce Fulfillment Services Market Report Highlights

  • The market is anticipated to witness substantial growth during the forecast period due to the proliferation of the e-commerce industry, especially in the emerging markets leading to an unprecedented rise in the number of online buyers
  • The shipping fulfillment service segment accounted for the largest revenue share in 2019 owing to trade liberalization policies resulting in increased imports and exports of cross-border shipments worldwide
  • The clothing and footwear application segment accounted for the largest revenue share in 2019 due to the growing acceptance of western culture and the evolving fashion needs of the youth population
  • The Asia Pacific dominated the global market and is expected to register the fastest growth over the forecast period. This is majorly attributable to the growth prospect offered by relatively untapped markets (rural areas and tier 2 cities) in the region.
  • Some of the prominent market players in the market include Red Stag Fulfillment, Shipfusion Inc., Amazon.com, Inc., ShipBob, Inc., and Ingram Micro, Inc. among others