Huge potential! Get the three major trends of e-commerce and logistics in the Philippines in the next five years

The pandemic has further fueled the market’s growth by shifting major retailers to online platforms to sustain the market, and the Philippines’ e-commerce logistics market is expected to grow at a CAGR of 29.0% during 2020-2025 .

Recently, a report analyzed the development trends of the Philippines' e-commerce and logistics markets in the next five years.

E-commerce sales set to soar by 2025

E-commerce in the Philippines is still in its early stages of development, with the country ranking behind other markets in Southeast Asia in terms of online retail sales.

However, strong economic growth , a growing middle class and young population , increasing number of internet and smartphone users, and government initiatives are driving e-commerce in the country.

At the same time, the opening of logistics centers and the introduction of new network technologies in last-mile logistics will provide much-needed impetus to shipping companies and consumers. Updated systems will help transportation companies plan routes, classify transactions and track all deliveries.

Promoting e-commerce logistics development in rural areas

This segment of the population is lacking due to the low level of e-commerce awareness in remote and rural areas compared to urban areas.

Transforming small supermarkets in rural areas into multi-functional commercial and distribution centers will enable them to provide various services to rural residents, such as helping customers order tickets online or purchase goods from e-commerce websites.

Furthermore , the improvement of last-mile services can prove to be one of the key parameters in evaluating customer experience and final delivery efficiency. It can be expected that the new model for handling the last mile in the Philippines will drive the growth of e-commerce logistics.

Long-term impact of Covid-19

The outbreak of the COVID-19 pandemic has disrupted social and economic activities around the world over the past year, but it has opened another window for e-commerce as people's desire to maintain social distance will drive consumers towards online shopping.

Before the pandemic, in March 2020, e-commerce accounted for 2% of total retail sales. By July 2020, 78% of consumers in the Philippines had made an e-commerce purchase in the past month.

The rise in e-commerce usage during the pandemic will continue to be a permanent feature of the retail industry. Logistics companies are also likely to invest more in technologies such as AI to derive information and insights from images .

The Philippines’ e-commerce and logistics markets have huge growth potential, supported by emerging e-commerce players in the country.

Cross-border e-commerce market

the Philippines