DHL: Poor logistics infrastructure could hold back e-commerce growth in Latin America

A new report from DHL and the Panamanian Government suggests that poor logistics infrastructure could hold back the growth of e-commerce in Latin America.

The white paper states that e-commerce is predicted to grow at an annual rate of 22% in Latin America through 2021 and that, between 2016 and 2018, the region was the fastest growing in the world for Uber, Netflix and Air BnB.

“The rapid adoption of these disruptive e-commerce platforms, accelerated by less variety, infrastructure challenges and a perceived lower level of customer service from traditional operators in the segments, suggests that Latin American consumers are particularly responsive to newer digital buying models,” DHL said.

However, while this expected growth presents plenty of opportunities for the transport and logistics sector, there are also numerous challenges.

“Inconsistency in the ease and speed of customs clearance, poor GPS coverage and difficulties with congestion and sub-optimal infrastructure for last-mile delivery, and the complexity of reverse logistics processes for returns are all potential brakes on growth,” DHL said.

The white paper identified five key elements that comprise a successful regional logistics hub to support cross-border e-commerce: free trade zone capabilities, efficient port and airport infrastructure, business-friendly trade and customs regulations (for example, for cross-border returns), specific e-commerce logistics knowledge and inter-industry cooperation, with merchants, technology and logistics providers working in sync.