Indian D2C Market to Reach 3 Billion Shipments by 2027, Backed by 3PL Providers: Redseer Report

The domestic Direct-to-Consumer (D2C) market in India is poised for remarkable growth, with projections indicating a whopping 3 billion shipments by 2027, according to a recent report from Redseer Strategy Consultants, a leading strategy consulting firm. The report also underlines that third-party logistics providers (3PLs) are expected to play a pivotal role in facilitating this surge.

The Indian D2C market is anticipated to achieve a Gross Merchandise Value (GMV) ranging from $30-35 billion by 2027. This substantial growth is attributed to the rise of emerging D2C brands and the critical support provided by 3PL partners.

Delhivery, India’s largest fully integrated logistics services provider, has emerged as the preferred partner for D2C brands looking for cutting-edge technology and swift, dependable deliveries spanning a broader range of pin codes. Following closely is Blue Dart, another prominent player in the logistics arena.

Brands with cost-effective shipping requirements often opt for players like Shadowfax and Xpressbees, with Shadowfax being more focused on metropolitan areas.

To compile this report and understand the success factors for 3PLs catering to D2C brands, Redseer Strategy Consultants collaborated with over 60 emerging D2C brands in India. The report unravels the expectations of these brands from their 3PL partners.

The report underscores that the D2C market in India is still in its early stages. With an environment that encourages and facilitates brand creation, this sector is set to exhibit extraordinary growth. The predicted GMV of $30-35 billion by 2027 represents a Compound Annual Growth Rate (CAGR) of around 40% for the period between 2022 and 2027. This growth significantly outpaces the broader retail market and the overall e-commerce sector.

In 2022, the D2C market saw approximately 0.5 billion shipments, and this is expected to surge to a substantial 3 billion D2C shipments by 2027.

Highlighting the integral role of 3PLs in this growth story, Mrigank Gutgutia, a partner at Redseer, emphasized, “3PL solutions tie in well with the D2C segment as demand varies across cities and regions and the required logistics investment is on the higher side. Brands need reliable logistics partners with a wider reach across India to ensure consistency of experience.”

The report also reveals that D2C brands’ expectations from 3PL partners vary based on the category and size of the brand. For instance, in the fashion segment, effective return management is crucial, while smaller brands prioritize cost-efficient shipments and robust shipment protection. Beauty and personal care brands require cold-storage supply chains for fragile items, whereas home and general merchandise brands seek reliable insurance and shipment protection. Finally, packaged food and beverage brands prioritize affordable shipping and dense networks to ensure swift city deliveries.