Changing Consumer Preference for Online Shopping, Entry of New Players and Technological Disruptions Expected to Drive the UAE E-Commerce Logistics Market: Ken Research

Key Findings

Way Forward for E-Commerce in UAE: In the past few years, the UAE has managed to position itself as one of the fastest-growing e-commerce markets in the world. It is currently the most advanced e-commerce market in the Middle East and North Africa, revealing an estimated annual growth of ~17% between 2020 and 2025. While customers continue to enjoy the 'destination shopping' aspect of visiting a physical store, COVID-19 has encouraged many people to try e-commerce for the first time. This jump in online users is not expected to reduce. The country has transformed into a digital hub providing access to high-speed internet to its citizens. This along with other factors has led to a rise in the popularity of online shopping. From business-friendly laws and regulations to a rise in the popularity of online shopping culture, a variety of factors would continue to drive the rapid growth of e-commerce in the area.

Promoting E-Commerce Logistics Development in UAE: Opening up of logistics hubs along with the introduction of new web technologies in last mile logistics would provide the much needed boost to the shipping companies as well as the consumers. The growth of e-commerce logistics companies will highly depend on their last mile delivery model. Mobile Depots are expected to make urban deliveries faster as where in mobile depots will carry parcels of the day from the fulfilment centers to the city centre for last mile delivery. New models for handling the last mile such as "click and collect" locations are further anticipated to drive the growth of E-commerce logistics. Moreover, local retailers are expected to increase their presence in the e-commerce segment and would partner with an e-commerce logistics company to deliver the products. Companies would focus more on technology upgradation such as GPS Monitored Robots, Drones, Inbuilt RFID, GPS, IoT, telematics for better inventory management.

Long Term Positive Impact of Covid-19: The sudden onset of the pandemic has essentially interrupted and unsettled social and economic activities worldwide. Despite the slump faced by the commercial sector at the onset of the pandemic, long stretches of progress have occurred recently with the offline market moving to the web. This growth can be mainly attributed to the increased demand for quick, comfortable, and speedy delivery of products and services. 49% customers are shopping more online since the start of pandemic with high share of spends attributable to Groceries, Retail Goods, Apparels, and Electronics etc. Online retailers have seen a huge decrease in cash on delivery (COD) orders, and a remarkable expansion in digitally paid orders. The abrupt flood in the utilization of online businesses resulted in a demand to upscale the existing logistics networks. Businesses were increasingly reliant on advanced logistical networks with the demand for competent delivery partners increasing by 60% during the first 3 to 4 months of COVID-19. Logistics companies are likely to invest more on technologies such as AI to derive information and insights, such as delivery packaging, weight, and the like from images, detect anomalies, perform quality assurance checks, or build delivery schedules.

Analysts at Ken Research in their latest publication "UAE E-Commerce Logistics Market Outlook to 2025 – Driven by Growth in Online Shoppers along with Introduction of New Age Technologies by Logistics Players" observed that the e-commerce and e-commerce logistics market in UAE has a great potential to grow supported by emerging e-commerce players in the country.  Covid-19 outbreak has further accentuated the growth of the market by shifting major retailers on online platform for sustenance in the market. UAE E-Commerce Logistics Market is expected to grow at a CAGR of 15.8% on the basis of number of shipments delivered over the forecast period 2020-2025.

Key Segments Covered:-

By Accepted & Returned Orders

By Channel

By Type of Shipments

By Area of Delivery

By Mode

By Delivery Period

By Type of Products

By Payment Mode

E-Commerce Logistics Companies Covered:-

E-Commerce Marketplace Platform Covered:-

Key Target Audience:-

Time Period Captured in the Report:-

Key Topics Covered in the Report:-

For More Information on the research report, refer to below link:-

UAE E-Commerce Logistics Market Research Report 2025

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