Global Journal of Management and Business Research, A: Administration and Management, Volume 23 Issue 2

An Assessment of the Last Mile Delivery Market in Saudi Arabia during and Post COVID-19 69 Global Journal of Management and Business Research Volume XXIII Issue II Version I Year 2023 ( ) A © 2023 Global Journals Hani K. Alzahrani Author: e-mail: hani.alzahrani.2@aramco.com Abstract- Last mile delivery (LMD) focuses on the final step in the supply chain which considered to be the most critical part of the supply chain. This research examines the LMD in Saudi Arabia during and post COVID-19. Further, the challenges and successes of the companies in Saudi Arabia were examined to provide insight into market opportunity. Data was collected by way of semi-structured interviews with professionals working in the LMD industry that were purposively selected based on their roles within their organisation that would allow them to discuss their LMD in their organisation, and the impact of the Covid-19 pandemic on their business and on LMD specifically within and outside their organisation. Interviews were conducted and these were analysed using Grounded Theory combined with thematic analysis. Further, as it relates to the LMD market specifically, there appear to be permanent changes in how people are shopping as well as an evolution of payments in Saudi Arabia. I. I ntroduction a) Background ast mile delivery (LMD) focuses on the final step in the supply chain and that considered to be the most expensive aspect of providing home delivery (de Souza et al., 2014). This is an issue that has to be addressed by all businesses involved in delivery to consumers, and this has increased over the last two decades as online shopping has grown. The surge in online business across the world has led to increased emphasis on home delivery and the LMD problem is a key issue in this area (de Souza et al., 2014). As a result, there has been a growth in the need for LMD services globally, which is driven by the development and growth in the e-commerce sector business and the rise in the trading activities (Yadav and Mutreja, 2022). The global LMD market size was estimated in 2020 at a value of US$ 39.6 Billion and is projected to grow at a compound annual growth rate (CAGR) of approximately 9% to reach over US$ 66 Billion by 2026 (Sharma, 2021). In the Kingdom of Saudi Arabia (hereafter KSA or Saudi Arabia) in particular, the LMD market gained great importance on back of e-commerce and trading sectors growth. Development of the LMD market became an integral part of the Kingdom’s 2030 vision (CITC, 2019) as the Kingdom has positioned itself to become the new logistics hub for the Middle East (Vision 2030, 2022). The LMD market in Saudi Arabia was valued at US$ 285 Million in 2020, and is projected L to reach US$ 521 Million by 2030, registering a CAGR of 6.3% from 2021 to 2030 (Yadav and Mutreja, 2022). This research examines the issue of LMD in Saudi Arabia. b) Research Overview and Aims Covid-19 pandemic has led to an increase in online shopping and home deliveries, spurred on by the need for lockdowns and cessations of movements, and this has also affected business models. Thus, this research examines how companies reacted strategically during and post Covid-19 to adapt to the demand trends. c) Research Objectives The key objectives for this study are as follows: 1. To provide an overview of the LMD market in Saudi Arabia during and after Covid-19 and examine how this has influenced the LMD industry in Saudi Arabia; and 2. To assess the challenges that companies faced during the pandemic and might face while entering the LMD market in Saudi Arabia. d) Research Question This research is guided by the following question. How have LMD companies been adapting to market trends during and after Covid-19? e) Research Scope The scope of the study is limited to providing an assessment of the LMD market in Saudi Arabia. The research data was collected between April 2022 and November 2022 and targeted key opinion leaders of different firms in Saudi Arabian LMD market. f) Importance of the Study The Saudi Arabia launched its Vision 2030 in April 2016 and one of the key pillars of the vision is transforming the Kingdom into the go-to logistics hub for the region, capable of efficiently linking trade across three continents, namely Asia, Europe, and Africa. There are potential development and expected growth in the LMD market in KSA since the government is focusing on logistics as part of its 2030 vision (Vision 2030, 2022). The LMD in KSA was valued at $285.3 million in 2020, and is projected to reach $520.9 million by 2030, registering a CAGR of 6.3% from 2021 to 2030. Last mile delivery aims to deliver items to customers as quickly as possible while minimizing company costs (Cabral A. R., 2021). Last mile delivery accounts for more than ~50%