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Physical Internet Market

ID: MRFR/ICT/9349-HCR
100 Pages
Ankit Gupta
October 2025

Physical Internet (PI) Market Research Report: Information By Type (Logistic Nodes and Logistic Network), By Component (Solution and Services), By Organization Size (SMEs and Large Enterprises), By Vertical (Retail & E-commerce, Transportation & Logistics, Pharmaceuticals and Healthcare, Manufacturing, FMCG, Automotive, Aerospace & Defense, and Others), and By Region (North America, Europe, Asia-Pacific, and Rest Of The World) – Market Forecast Till 2035.

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Physical Internet Market Summary

As per MRFR analysis, the Physical Internet Market Size was estimated at 12.5 USD Billion in 2024. The Physical Internet industry is projected to grow from 13.82 USD Billion in 2025 to 43.68 USD Billion by 2035, exhibiting a compound annual growth rate (CAGR) of 12.19 during the forecast period 2025 - 2035.

Key Market Trends & Highlights

The Physical Internet Market is poised for substantial growth driven by sustainability and technological advancements.

  • North America remains the largest market for the Physical Internet, showcasing robust demand for innovative logistics solutions.
  • Asia-Pacific is emerging as the fastest-growing region, propelled by increasing investments in digital infrastructure and smart technologies.
  • The logistics segment dominates the market, while the warehousing segment is experiencing rapid growth due to evolving consumer expectations.
  • Key market drivers include sustainability initiatives and technological integration, which are reshaping logistics and warehousing operations.

Market Size & Forecast

2024 Market Size 12.5 (USD Billion)
2035 Market Size 43.68 (USD Billion)
CAGR (2025 - 2035) 12.19%

Major Players

DHL (DE), FedEx (US), UPS (US), Maersk (DK), Kuehne + Nagel (CH), XPO Logistics (US), C.H. Robinson (US), DB Schenker (DE), Nippon Express (JP)

Physical Internet Market Trends

The Physical Internet Market is currently experiencing a transformative phase characterized by the integration of advanced technologies and innovative logistics solutions. This market appears to be evolving towards a more interconnected and efficient system, where the flow of goods and information is optimized through digital platforms. Stakeholders are increasingly recognizing the potential of collaborative networks, which facilitate seamless interactions among various participants in the supply chain. As a result, the emphasis on sustainability and reduced environmental impact is becoming more pronounced, prompting companies to adopt greener practices and technologies. Moreover, the rise of e-commerce and changing consumer expectations are driving the demand for faster and more reliable delivery services. This trend suggests that businesses are likely to invest in automation and smart logistics to enhance operational efficiency. The Physical Internet Market seems poised for further growth, as organizations strive to adapt to the dynamic landscape of global trade and logistics. The ongoing advancements in artificial intelligence, big data analytics, and the Internet of Things are expected to play a crucial role in shaping the future of this market, enabling more responsive and agile supply chains.

Sustainability Initiatives

The focus on sustainability within the Physical Internet Market is intensifying, as companies seek to minimize their carbon footprints. This trend indicates a shift towards eco-friendly practices, including the use of renewable energy sources and sustainable packaging materials. Organizations are increasingly collaborating to develop shared logistics solutions that reduce waste and enhance resource efficiency.

Technological Integration

The integration of cutting-edge technologies is reshaping the Physical Internet Market. Innovations such as artificial intelligence, machine learning, and blockchain are being adopted to streamline operations and improve transparency. This trend suggests that businesses are likely to leverage these technologies to enhance decision-making processes and optimize supply chain management.

Consumer-Centric Logistics

The demand for consumer-centric logistics solutions is growing within the Physical Internet Market. As customer expectations evolve, companies are focusing on providing personalized services and faster delivery options. This trend indicates that businesses may invest in advanced tracking systems and flexible delivery methods to meet the diverse needs of their clientele.

Physical Internet Market Drivers

Regulatory Support

Regulatory frameworks are increasingly supporting the Global Physical Internet Market (PI) Market Industry by promoting collaborative logistics and shared infrastructure. Governments are recognizing the benefits of PI principles in enhancing supply chain resilience and efficiency. Policies that encourage the adoption of digital technologies and data sharing among logistics providers are becoming more prevalent. Such regulatory support not only facilitates the implementation of PI frameworks but also fosters innovation within the industry. As these supportive measures gain traction, they are expected to contribute to the market's expansion, aligning with the projected growth trajectory towards 45 USD Billion by 2035.

Global Trade Dynamics

The Global Physical Internet Market (PI) Market Industry is influenced by evolving global trade dynamics, including shifts in trade agreements and international regulations. As countries seek to enhance trade relationships, the demand for efficient logistics solutions increases. The PI framework facilitates seamless cross-border logistics, enabling businesses to adapt to changing trade landscapes. For instance, the implementation of standardized protocols can simplify customs processes, reducing delays and costs. This adaptability is crucial for businesses aiming to remain competitive in a globalized economy. Consequently, the market is poised for growth, with a projected CAGR of 12.35% from 2025 to 2035.

Consumer Demand for Speed

In the Global Physical Internet Market (PI) Market Industry, consumer demand for faster delivery times is reshaping logistics strategies. As e-commerce continues to flourish, businesses are compelled to adopt PI principles to meet customer expectations for rapid fulfillment. The ability to provide real-time tracking and efficient last-mile delivery solutions is becoming paramount. Companies that leverage PI frameworks can optimize their supply chains, ensuring timely deliveries while minimizing costs. This shift towards speed is likely to drive market growth, as businesses recognize the competitive advantage of efficient logistics in an increasingly impatient consumer landscape.

Market Growth Projections

The Global Physical Internet Market (PI) Market Industry is on a growth trajectory, with projections indicating a rise from 12.5 USD Billion in 2024 to 45 USD Billion by 2035. This anticipated growth reflects the increasing adoption of PI principles across various sectors, driven by technological advancements, sustainability initiatives, and evolving consumer demands. The market is expected to experience a compound annual growth rate of 12.35% from 2025 to 2035, highlighting the industry's potential to transform logistics and supply chain management. These projections underscore the importance of embracing PI frameworks to enhance efficiency and competitiveness in a rapidly changing global landscape.

Sustainability Initiatives

Growing awareness of environmental issues is propelling the Global Physical Internet Market (PI) Market Industry towards sustainable practices. Companies are increasingly adopting PI principles to minimize their carbon footprints and enhance resource efficiency. For example, the integration of shared logistics networks can significantly reduce empty miles and optimize transportation routes. This shift not only aligns with corporate social responsibility goals but also meets regulatory requirements aimed at reducing emissions. As sustainability becomes a core business strategy, the market is anticipated to expand, with projections indicating a growth to 45 USD Billion by 2035, reflecting a commitment to greener logistics.

Technological Advancements

The Global Physical Internet Market (PI) Market Industry is experiencing rapid technological advancements that enhance logistics and supply chain efficiency. Innovations in automation, artificial intelligence, and the Internet of Things are streamlining operations and reducing costs. For instance, smart containers equipped with sensors can provide real-time data on shipment conditions, improving transparency and reliability. As these technologies become more accessible, they are likely to drive the adoption of PI frameworks across various sectors, facilitating a more interconnected and efficient global supply chain. This trend is expected to contribute to the market's growth, projected to reach 12.5 USD Billion in 2024.

Market Segment Insights

By Application: Logistics (Largest) vs. Warehousing (Fastest-Growing)

In the Physical Internet Market, the application segment exhibits notable variations in market share distribution among its core components: logistics, supply chain management, transportation, and warehousing. Logistics holds the largest market share, driven by the increasing demand for efficient and streamlined operations. Supply chain management closely follows, enabling businesses to optimize their processes. Transportation and warehousing are also significant, with interdependencies that enhance overall operational performance.

Logistics: Dominant vs. Warehousing: Emerging

Logistics represents the dominant application within the Physical Internet Market, characterized by its robust frameworks that streamline operations and optimize the flow of goods. It encompasses various functions, such as inventory management, order fulfillment, and distribution. Warehousing, on the other hand, is emerging as a vital segment due to its rapid growth in response to e-commerce demands and the need for strategic inventory holding. Enhanced technologies, such as automation and data analytics, are reshaping warehousing capabilities, allowing businesses to respond quickly to market changes while maintaining efficiency.

By Technology: IoT (Largest) vs. AI (Fastest-Growing)

In the Physical Internet Market, the segment values of Technology are dominated by the Internet of Things (IoT), which significantly enhances connectivity and data exchange across logistics and supply chains. Following IoT, Artificial Intelligence (AI) emerges as a pivotal force, revolutionizing operational efficiencies and predictive analytics. Blockchain and Big Data, though instrumental, take a backseat in market share, primarily serving as complementary technologies that support the overall ecosystem but do not currently exhibit the same influence as IoT and AI.

Technology: IoT (Dominant) vs. AI (Emerging)

The Internet of Things (IoT) stands as the dominant technology within the Physical Internet Market due to its critical role in ensuring seamless connectivity among devices, facilitating real-time data sharing across logistics. Its widespread adoption has enabled companies to optimize their supply chain operations and improve inventory management. Conversely, Artificial Intelligence (AI) is distinguished as the fastest-growing technology, leveraging advanced algorithms and machine learning to analyze vast datasets, predict trends, and enhance decision-making processes. While IoT provides the infrastructure, AI adds significant value by transforming data into actionable insights, thus driving innovation and efficiency in the physical internet infrastructure.

By End Use: E-commerce (Largest) vs. Retail (Fastest-Growing)

In the Physical Internet Market, the End Use segment displays a varied distribution among key sectors including E-commerce, Retail, Manufacturing, and Healthcare. E-commerce holds the largest market share, driven by the growing reliance on digital platforms for shopping and goods delivery. Meanwhile, Retail is showing significant growth due to the integration of advanced logistics and supply chain solutions that enhance customer experiences and operational efficiency. These sectors are reshaping how goods are delivered and consumed, placing them at the forefront of this market.

Retail (Dominant) vs. Healthcare (Emerging)

Retail remains the dominant sector within the End Use segment of the Physical Internet Market, characterized by its adaptation of innovative delivery systems and omnichannel strategies that satisfy consumer demand for instant access and convenience. As technological advancements penetrate this space, retailers are harnessing the Internet of Things (IoT) and data analytics, leading to streamlined operations. Conversely, the Healthcare sector is emerging as a significant player, driven by the increasing need for efficient logistics in medical supplies and pharmaceuticals. This segment is gaining traction as healthcare providers seek to enhance supply chain resilience, ensuring timely delivery and accessibility of critical healthcare products, which positions it favorably for future expansion.

By Service Type: Consulting (Largest) vs. Support (Fastest-Growing)

In the Physical Internet Market, the service type segment is diversely represented by consulting, integration, maintenance, and support services. Consulting holds the largest share as it offers strategic guidance essential for businesses transitioning to physical internet infrastructures. Meanwhile, support services are rapidly gaining traction, reflecting a growing demand for ongoing assistance as companies increasingly rely on continuous connectivity and agile operations to enhance their supply chain performance. As organizations navigate the complexities of implementing and maintaining physical internet solutions, the growth of consulting services is driven by the necessity for expert insights that contribute to efficiency and innovation. Simultaneously, the rise of support services aligns with the increasing complexity of technologies and infrastructures, compelling businesses to seek reliable solutions that ensure minimal downtime and maximize productivity.

Consulting (Dominant) vs. Maintenance (Emerging)

Consulting services are identified as the dominant force in the Physical Internet Market due to their role in providing tailored strategies and insights that facilitate organizations’ adaptation to new technologies. These services encompass a variety of tasks, including assessments, strategy formulation, and implementation planning that are crucial for successful transitions. In contrast, maintenance is emerging as a key service type, fueled by the need for ongoing operational efficiency and system reliability. This is particularly significant as disruptions could impact the interconnected logistics and seamless operation that the physical internet aims to enhance. As organizations become increasingly reliant on their network infrastructures, the demand for robust maintenance solutions is expected to grow, ensuring systems remain optimized and operational.

By Deployment Type: Cloud-based (Largest) vs. On-premises (Fastest-Growing)

The Physical Internet Market's deployment type segment is dominated by cloud-based solutions, which hold the largest share due to their scalability and flexibility. Organizations prefer cloud-based systems as they provide cost-effective alternatives, allowing them to efficiently manage resources and data. In contrast, on-premises deployment has shown significant growth recently, appealing to businesses seeking enhanced control over their infrastructure and data security.

Deployment Types: Cloud-based (Dominant) vs. On-premises (Emerging)

Cloud-based deployment in the Physical Internet Market stands out due to its ability to support vast networks and facilitate collaboration in real-time. This model allows organizations to leverage shared resources and data analytics across operations, which enhances efficiency and reduces operational costs. On the other hand, on-premises deployment is emerging as a preferred choice for companies prioritizing security and compliance. By maintaining their systems in-house, businesses can exert greater control over their IT infrastructure, ensuring robust data protection while still adapting to new technological advancements.

Get more detailed insights about Physical Internet Market

Regional Insights

North America : Leading Market Innovators

North America is poised to maintain its leadership in the Physical Internet Market, holding a significant market share of 5.0 in 2025. The region's growth is driven by advanced logistics infrastructure, increasing e-commerce demand, and supportive regulatory frameworks. The integration of technology in supply chain management is also a key catalyst, enhancing efficiency and reducing costs. As companies adapt to consumer needs, the market is expected to expand further, supported by investments in automation and digitalization. The competitive landscape in North America is robust, featuring major players like FedEx, UPS, and DHL, which are continuously innovating to enhance service delivery. The U.S. leads the market, followed by Canada, with a focus on sustainability and efficiency. The presence of these key players fosters a dynamic environment, encouraging collaboration and competition. As the market evolves, companies are likely to leverage data analytics and AI to optimize operations, ensuring they meet the growing demands of consumers and businesses alike.

Europe : Emerging Logistics Hub

Europe's Physical Internet Market is projected to reach a size of 3.5 by 2025, driven by a strong emphasis on sustainability and regulatory support for green logistics. The European Union's initiatives to reduce carbon emissions and enhance supply chain transparency are pivotal in shaping market dynamics. As businesses adapt to these regulations, the demand for innovative logistics solutions is expected to rise, fostering growth in the sector. The region's commitment to digital transformation further accelerates this trend, making logistics more efficient and responsive. Leading countries in Europe include Germany, France, and the Netherlands, where major logistics firms like DB Schenker and Kuehne + Nagel are headquartered. The competitive landscape is characterized by a mix of established players and emerging startups, all vying for market share. The presence of key players enhances collaboration and innovation, driving the market forward. As the region embraces new technologies, the Physical Internet Market is set to thrive, aligning with broader economic goals and consumer expectations.

Asia-Pacific : Rapidly Growing Market

The Asia-Pacific region is witnessing rapid growth in the Physical Internet Market, projected to reach 3.0 by 2025. This growth is fueled by increasing urbanization, rising e-commerce activities, and government initiatives aimed at enhancing logistics infrastructure. Countries like China and India are at the forefront, with significant investments in technology and infrastructure to support the burgeoning demand. Regulatory support for digital logistics solutions is also a key driver, enabling businesses to optimize their supply chains effectively. China leads the market, followed by Japan and India, with major players like Nippon Express and XPO Logistics making significant inroads. The competitive landscape is vibrant, characterized by both local and international firms striving to capture market share. As the region continues to innovate, the integration of AI and IoT in logistics operations is expected to enhance efficiency and customer satisfaction, positioning Asia-Pacific as a formidable player in the global market.

Middle East and Africa : Emerging Logistics Frontier

The Middle East and Africa region is gradually emerging in the Physical Internet Market, with a projected size of 1.0 by 2025. This growth is driven by increasing investments in logistics infrastructure and a growing demand for efficient supply chain solutions. Governments in the region are actively promoting initiatives to enhance trade and logistics capabilities, which are crucial for economic development. The rise of e-commerce is also contributing to the demand for innovative logistics solutions, creating new opportunities for growth. Leading countries in this region include the UAE and South Africa, where logistics firms are expanding their operations to meet the rising demand. The competitive landscape is evolving, with both local and international players entering the market. As the region embraces technological advancements, the Physical Internet Market is expected to grow, aligning with broader economic goals and enhancing connectivity across borders.

Key Players and Competitive Insights

The Physical Internet Market is currently characterized by a dynamic competitive landscape, driven by the increasing demand for efficient logistics solutions and the integration of advanced technologies. Major players such as DHL (DE), FedEx (US), and Maersk (DK) are strategically positioning themselves through innovation and digital transformation. DHL (DE) has focused on enhancing its supply chain capabilities, while FedEx (US) emphasizes its commitment to sustainability and operational efficiency. Maersk (DK) is actively pursuing partnerships to expand its service offerings, thereby shaping a competitive environment that prioritizes agility and responsiveness.Key business tactics within the market include localizing manufacturing and optimizing supply chains to enhance efficiency. The competitive structure appears moderately fragmented, with several key players exerting influence over various segments. This fragmentation allows for a diverse range of services, yet the collective impact of major companies like UPS (US) and Kuehne + Nagel (CH) fosters a competitive atmosphere where innovation and customer-centric solutions are paramount.

In November UPS (US) announced a significant investment in AI-driven logistics solutions aimed at streamlining operations and improving delivery times. This strategic move underscores UPS's commitment to leveraging technology to enhance its service offerings, potentially positioning the company as a leader in operational efficiency within the Physical Internet Market. The integration of AI is likely to facilitate better decision-making and resource allocation, thereby enhancing customer satisfaction.

In October Kuehne + Nagel (CH) launched a new digital platform designed to optimize supply chain visibility and management. This initiative reflects the company's focus on digital transformation, enabling clients to track shipments in real-time and manage logistics more effectively. Such advancements may not only improve operational efficiency but also strengthen Kuehne + Nagel's competitive edge in a market increasingly driven by technology.

In September Maersk (DK) entered into a strategic partnership with a leading technology firm to develop blockchain solutions for enhanced transparency in shipping processes. This collaboration is indicative of Maersk's proactive approach to addressing industry challenges and improving trust among stakeholders. By adopting blockchain technology, Maersk aims to streamline operations and reduce costs, which could significantly impact its market positioning.

As of December current trends in the Physical Internet Market are heavily influenced by digitalization, sustainability initiatives, and the integration of AI technologies. Strategic alliances are becoming increasingly vital, as companies seek to enhance their service offerings and operational capabilities. The competitive differentiation is likely to evolve from traditional price-based competition to a focus on innovation, technology adoption, and supply chain reliability, suggesting a transformative shift in how companies compete in this space.

Key Companies in the Physical Internet Market include

Industry Developments

Amazon.com Inc., for example, The physical internet is about to get a lot more involved with an effort to build a network where boxes are bytes travelling through the supply chain network in the same way that data travels on the internet. Amazon wants to vertically integrate its logistics.

In order to provide a holistic approach for logistics and supply chain management invention research, innovation, and market deployment in Europe, the European Technology Platform (ETP) Alliance for Logistics Innovation via Collaboration in Europe (ALICE) was founded.

Future Outlook

Physical Internet Market Future Outlook

The Physical Internet Market is projected to grow at a 12.19% CAGR from 2025 to 2035, driven by technological advancements, sustainability initiatives, and increased demand for efficient logistics solutions.

New opportunities lie in:

  • Development of decentralized logistics hubs for enhanced supply chain efficiency.
  • Integration of AI-driven analytics for real-time inventory management.
  • Expansion of automated last-mile delivery systems to reduce operational costs.

By 2035, the Physical Internet Market is expected to be a cornerstone of global logistics, enhancing efficiency and sustainability.

Market Segmentation

Physical Internet Market End Use Outlook

  • Retail
  • Manufacturing
  • E-commerce
  • Healthcare

Physical Internet Market Technology Outlook

  • Internet of Things
  • Blockchain
  • Artificial Intelligence
  • Big Data

Physical Internet Market Application Outlook

  • Logistics
  • Supply Chain Management
  • Transportation
  • Warehousing

Physical Internet Market Service Type Outlook

  • Consulting
  • Integration
  • Maintenance
  • Support

Physical Internet Market Deployment Type Outlook

  • Cloud-based
  • On-premises
  • Hybrid

Report Scope

MARKET SIZE 202412.5(USD Billion)
MARKET SIZE 202513.82(USD Billion)
MARKET SIZE 203543.68(USD Billion)
COMPOUND ANNUAL GROWTH RATE (CAGR)12.19% (2025 - 2035)
REPORT COVERAGERevenue Forecast, Competitive Landscape, Growth Factors, and Trends
BASE YEAR2024
Market Forecast Period2025 - 2035
Historical Data2019 - 2024
Market Forecast UnitsUSD Billion
Key Companies ProfiledDHL (DE), FedEx (US), UPS (US), Maersk (DK), Kuehne + Nagel (CH), XPO Logistics (US), C.H. Robinson (US), DB Schenker (DE), Nippon Express (JP)
Segments CoveredApplication, Technology, End Use, Service Type, Deployment Type
Key Market OpportunitiesIntegration of advanced automation and data analytics enhances efficiency in the Physical Internet Market.
Key Market DynamicsRising technological advancements and regulatory changes are reshaping supply chain dynamics in the Physical Internet Market.
Countries CoveredNorth America, Europe, APAC, South America, MEA

Market Highlights

Author
Ankit Gupta
Senior Research Analyst

Ankit Gupta is an analyst in market research industry in ICT and SEMI industry. With post-graduation in "Telecom and Marketing Management" and graduation in "Electronics and Telecommunication" vertical he is well versed with recent development in ICT industry as a whole. Having worked on more than 150+ reports including consultation for fortune 500 companies such as Microsoft and Rio Tinto in identifying solutions with respect to business problems his opinions are inclined towards mixture of technical and managerial aspects.

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FAQs

How much is the Physical Internet (PI) market?

The global Physical Internet (PI) market size was valued at USD x.x Billion in 2022.

What is the growth rate of the Physical Internet (PI) market?

The global market is projected to grow at a CAGR of xx.xx% during the forecast period, 2023-2032.

Which region held the largest market share in the Physical Internet (PI) market?

North America had the largest share in the global market

Who are the key players in the Physical Internet (PI) market?

The key players in the market are Amazon.com Inc., UPS, AmeriCold Logistics LLC, Mercedes-Benz Group AG, SF Express Co. Ltd., Yamato Logistics Ltd., DHL, FedEx Corporation, Velove Bikes AB, and MIXMOVE

Which Type led the Physical Internet (PI) market?

The Logistic Nodes Type dominated the market in 2022.

Which Component had the largest market share in the Physical Internet (PI) market?

The Solution Component had the largest share in the global market.

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