E-Commerce Logistics Demands Bigger Spaces

The e-commerce industry thrived in Mexico in 2020. As MBN previously reported, the pandemic accelerated how people communicate with the digital world and promoted e-commerce for businesses and consumers. According to the Mexican Association of Online Sales’ (AMVO) survey “COVID-19’s Impact on Online Sales in Mexico,” by October 2020, 39 percent of the consumers surveyed have changed their habits to purchase more online. This created a larger demand for logistical spaces in Mexico City and its metropolitan area, Monterrey, Guadalajara, Leon and Tijuana, reports Immobiliare.

Yadira Torres-Romero, Research Director of Markets at CBRE Mexico, explains that the commercial activity registered in 1H20 was dominated by the logistics and distribution sector. Sectors that have increased demand for industrial spaces include logistics, manufacturing, automotive, food and beverages, according to the CBRE. “We are hoping that this tendency increases during 2021,” commented Torres-Romero reports T21. Queretaro, for example, has recently received investments to strengthen its e-commerce capabilities, as MBN previously reported, with FedEx Express and Mercado Libre making large investments in logistics.

While e-commerce is booming, physical stores are lagging behind. IKEA had planned on opening its doors with a physical store in Mexico in October 2020, as MBN had previously highlighted. After the pandemic hit, the inauguration was postponed to February 2021 but the company did release its online sales platform with better-than-expected results. “We launched in a very discrete manner because we were expecting to grow very little, but I am very happy with the support given by Mexican consumers and their overwhelming response. There was a 1000 percent larger demand than we expected, which is something you cannot prepare yourself for. We are going to hire more people to process and prepare shopping orders. We will work on a plan to have our orders ready as soon as possible and we are looking for ways to increase the number of people in contact centers,” Malcolm Pruys, CEO of IKEA Mexico, told Forbes Mexico. Pruys highlighted that the size of the Mexican market creates bigger challenges for distribution, particularly when dealing with large products like furniture. He continued by explaining possible expansion strategies to get IKEA’s products all around the country, with bigger investments in logistics and distributions, not retail centers.