Micro Fulfillment Centers: Transforming E-commerce Delivery and Projected to Reach $36 Billion Opportunity by 2030 - ResearchAndMarkets.com

The Micro Fulfillment Center (MFC) market is rapidly growing and is expected to offer substantial opportunities in the coming years, with a cumulative opportunity worth $36 billion by 2030.

The market is projected to witness significant growth, with an installed base of over 5,600 MFCs if the technology and concept continue to expand. By 2025, the market is anticipated to reach approximately $3 billion in installed capacity, setting the stage for future growth.

Key Highlights of the Micro Fulfillment Market Study:

1. Growth Trajectory: The study predicts that annual MFC installations will grow over 20 times by 2030, from the current installed base of around 250 to approximately 5,600 in 2030.
2. Geographical Deployment: More than 50% of these micro fulfillment centers are expected to be deployed in the United States in 2023, making it the leading market for MFCs.
3. Market Expansion: The Micro Fulfillment Market is projected to grow 2 times by 2025 and 12 times by 2030 compared to the current market size in 2022.
4. Contributions: MFC services are expected to contribute approximately $2 billion by 2030, highlighting the significance of this emerging market.
5. Technology Trends: Nearly 60% of MFC installations in 2030 are expected to deploy Shuttle-Based and Cube-Storage technologies, with players like AutoStore and Takeoff Technologies leading the way. Other companies like Geek Plus, Grey Orange, and Hai Robotics are also entering the market with Automated Mobile Robots (AMR) solutions.
6. Market Revenue: The market is expected to generate more than $5 billion in revenue from Micro Fulfillment automation by 2030, primarily driven by Grocery Omnichannel and Pure-Play E-commerce/Q-commerce players.
7. Deployment Locations: The study forecasts approximately 1,000 MFC installations for in-store deployment and around 120 installations for dark stores in 2030. Some installations may also be integrated within existing or new Distribution Centers (DCs) or Fulfillment Centers (FCs).
8. Warehouse Sizes: Over 50% of MFC installations are projected to target warehouses with sizes between 5,000 square feet and 25,000 square feet. There is also expected growth in the less than 5,000 square feet segment, driven by new dark stores opened by ultrafast delivery players.
9. Delivery Services: For delivery service providers like Getir, Grofers, GoPuff, Instacart, and others, manual order fulfillment is not a sustainable or profitable model. Automation is seen as a key solution, and these providers may partner with retailers or establish their own dark stores to automate the fulfillment process.
10. Global Market Dominance: The United States is expected to dominate the market for the next decade, accounting for nearly 50% of the worldwide market share by 2030.

Micro Fulfillment - Meeting the Growing Demand:

Micro Fulfillment Centers are considered a crucial solution to meet the rising demand for e-commerce, especially for same-day or same-hour delivery. Industry giants like Amazon, Walmart, and Alibaba have been at the forefront of adopting these technologies to enhance efficiency and meet consumer expectations.

The key drivers for adopting MFCs include:

• E-Grocery Growth: It is estimated that online grocery will contribute more than 10% of overall grocery sales in the US by 2025.
• Consumer Habits: Consumers have developed a habit of buying groceries online, especially during the pandemic, and are likely to continue this behavior.
• Delivery Options: Multiple delivery options such as home delivery, in-store pick-up, curb-side pickup, and locker delivery are expected to be available.
• Urban Warehouses: Urban warehouses with automation are essential to meet same-day delivery expectations.
• Delivery Fee: The cost of delivery is a key factor influencing the choice of digital channels in the long term.

Overall, Micro Fulfillment Centers have the potential to make online grocery businesses more profitable by reducing costs related to storage, retrieval, picking, last-mile delivery, and real estate.

Market Trends in Micro Fulfillment:

• The Micro Fulfillment Market has emerged as a critical trend, especially during the COVID-19 pandemic. It is driven by factors such as eGrocery Growth, Urban Warehouses, Dark Stores, and Automated Cold Storages. Major investments have been made in startups specializing in MFC technologies, and established players are also entering this space.
• Key technologies in the MFC market include AutoStore, Takeoff Technologies, Fabric, Exotec Solutions, Attabotics, Berkshire Grey, Geek Plus, and Alert Innovation. These technologies offer various advantages and are suitable for different types of fulfillment centers.
• Software is expected to play a significant role in differentiating MFC systems and adding value to the overall solution. Both in-house software capabilities and partnerships are being utilized to enhance MFC operations.
• Geographically, the United States is expected to lead the market for the next decade, followed by the United Kingdom, China, Japan, and France.
• Micro Fulfillment is recognized as a crucial solution to improve the efficiency and profitability of e-commerce, particularly in the rapidly evolving grocery sector. The market is expected to witness substantial growth in the coming years, with a significant number of installations and innovations in technology and processes.