Last-mile delivery drives growth in logistics sector

Wize

• Logistics well funded in Mena
• GCC industry could hit $1.85bn
• Sustainability key area

Last-mile delivery is recording strong growth in the Mena logistics sector, which itself is receiving substantial funding in the region. 

Logistics was the third highest-funded sector in the Mena region last year, amounting to $362 million, according to data from advisory service and investor Wamda.

Wize, a logistics startup in Dubai which specialises in last-mile delivery, recently secured $16 million in pre-seed funding from UAE investors. Last-mile delivery is the final part of the journey when the consumer gets their product.

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Wize offers electric motorcycles, a rental and subscription platform for businesses, battery-as-a-service, swapping stations and software components.

The startup also holds a 50 percent stake in Motoboy, a delivery service provider in Dubai.

Alexander Lemzakov, co-founder and CEO of Wize told AGBI its subscription-based electric motorcycles comply with UAE regulations for courier transport and its delivery boxes are standardised to Roads and Transport Authority requirements.

“Using electric motorcycles, businesses reduce transportation costs by up to 30 percent per month,” he said.

Wize has developed its own software that allows it to manage battery-swapping stations and monitor the condition of all batteries. 

“We understand the challenges posed by extreme weather conditions on electric vehicles and riders, which is why we have invested in technology to safeguard batteries during high temperatures, and are also exploring special suits for riders,” Lemzakov said.

Wize’s expansion plans extend to launching in other countries outside the UAE, including Saudi Arabia next year.

The company aims to introduce an additional 1,000 electric motorcycles to the region.

Yango, another logistics company, announced the opening of its global operational office in Dubai during the fourth quarter of 2023. The office will oversee various operations, including its last-mile delivery arm Yango Delivery.

Yango is a subsidiary of the Netherlands-headquarted but Russian-based company Yandex.

Earlier in the year, the logistics provider Aramex also introduced fully electric vehicles to its delivery fleet in the UAE.

With the climate change conference Cop28 set to start this week, sustainability is a key issue for the sector and One Moto, another Dubai-based company, recently said it aims to decarbonise last-mile deliveries using electric vehicles, with plans to serve 100 cities by 2028. 

These initiatives reflect the changing landscape of last-mile deliveries. Indian market research company Infinium Global Research predicts the GCC market could reach $1.85 billion by 2027, driven by a compound annual growth rate of 7.82 percent.