Market Trends of Poland Freight and Logistics Industry
This section covers the major market trends shaping the Poland Freight & Logistics Market according to our research experts:
Rise in Total Warehousing Space in Poland
Strong demand for warehouse and industrial space in Poland is primarily driven by the need to diversify logistics chains covering both metropolitan and smaller regional markets, as well as border areas.
E-commerce and manufacturing sectors are expected to continue to grow in the coming months. An unprecedented amount of space has been leased on a short-term basis as a result of the exponential rise of online retail. Comparing online and traditional retail chains, online retailers require three times as much storage space. The expansion in space is anticipated to continue as the Polish internet trade market grows.
A record-breaking 1.27 million square feet of warehouse space was delivered across 45 projects in the first quarter of 2022, with total supply in the following 12 months at 3.6 million square feet, a 57% year-over-year increase.
However, key vacancy rates fell to 3.3% at the end of March 2022, the lowest level since records began due to a sharp increase in demand compared to supply growth. Further, Net absorption reached a record 1.41 million square meters in Q1 2022, an increase of 85% year-on-year. The biggest year-on-year declines in vacancy were in Pomerania, Greater Poland, Lodz and Lower Silesia, Silesia, Lesser Poland and Mazovia.
In the first quarter of 2022, the developer began construction of approximately 1.5 million square feet of warehouse space, bringing the total development pipeline to 4.8 million square feet. If all upcoming projects are realized within the planned timeframe, the total inventory will increase by more than 20% in the next 12 months from the current 25 million square meters. These are the factors that are expected to drive the country's freight and logistics market.
Strong E-commerce Growth in Poland Driving the Logistics Market
Poland is an attractive market for the development of e-commerce as the number of online purchases reached an all-time high in Poland. Poland is one of the fastest-growing e-commerce markets in Europe. In 2020, online spending reached EUR 10 billion on the main product categories, i.e., clothing, consumer electronics, furniture, food, and toys. This was an increase of about 25% compared to pre-COVID levels.
The rapid growth of e-commerce is primarily driven by the expansion of omnichannel and the rising penetration rate of online retailing (share of total sales). Retailers focus on customer experience to enable convenient and quick shopping on any device. To fulfil the customer's needs, the companies are developing additional mobile sales channels. This is expected to affect return logistics and improve processing times considerably.
Polish customers have high standards for deliveries. Polish residents are the second most demanding of all the nations examined, with 25% expecting their online purchases to arrive within 1-2 days, according to a poll by international media. Just 5% are willing to wait more than six days, while 67% anticipate getting their things within three to five days. Hence, sellers who wish to grow their market share in Poland must be aware of delivery deadlines and select a logistics provider with a solid track record for prompt delivery. Further, Poland's strategic location at the crossroads of major transport routes, rise in investments to improve its transport infrastructure, and the growth of urban and cross-border logistics is expected to drive the market through teh forecast period.
