In an increasingly unpredictable market environment, third-party logistics (3PL) providers face mounting challenges in managing last-mile delivery for oversized goods. A recent report titled "Delivering in Uncertainty: Analysis of the U.S. Oversized Last-Mile Delivery Market" , jointly published by supply chain consultancy Armstrong & Associates and the National Home Delivery Association (NHDA), provides critical insights into this complex sector.
Market Dynamics and Growth Projections
The comprehensive study examines multiple facets of oversized last-mile delivery, including market size, key players, customer segmentation, transportation costs, regional trends, labor data, driver employment models, revenue patterns, and the growing role of freight brokers in securing delivery capacity.
The report defines last-mile delivery as "the transportation of oversized goods (non-parcel) from the final warehouse or terminal to end recipients" , encompassing items such as furniture, appliances, electronics, fitness equipment, building materials, industrial machinery, and medical devices. These deliveries serve both business-to-business (B2B) and business-to-consumer (B2C) markets.
Data reveals that analyzed 3PL companies anticipate 2024 last-mile delivery revenues ranging from $1.5 million to $1.1 billion, collectively representing approximately 32% of the projected $10.15 billion U.S. 3PL oversized last-mile market. Armstrong & Associates estimates the market grew at an 11.4% compound annual growth rate (CAGR) between 2017-2024, with projections slowing to 7.2% for 2024-2026.
Key Challenges and Industry Shifts
The anticipated slowdown in growth stems from multiple factors, including new tariff implementations creating market uncertainty and reduced consumer spending significantly impacting last-mile logistics providers. Despite these headwinds, the report forecasts steady revenue increases, projecting $10.86 billion in 2025 and $11.66 billion in 2026.
A notable industry shift involves workforce composition, with independent contractors and owner-operators now comprising 96.4% of last-mile delivery drivers—up from 92.6% in 2023. Employee drivers account for just 3.6% of the workforce. This reflects a decades-long industry preference for contractor-based models, though companies are increasingly turning to freight brokers to secure capacity from small fleets (typically operating 5-7 trucks).
Product Categories and Specialized Delivery Needs
The 2024 product breakdown shows appliances (40.6%) and furniture (30.2%) dominating the oversized last-mile market, generating $4.119 billion and $3.059 billion in revenue respectively. Other segments include:
- Building materials: 9.0%
- Fitness equipment: 6.6%
- Electronics/high-tech: 5.6%
- Mattresses: 3.1%
- Industrial machinery: 1.4%
- Medical devices: 0.8%
The prominence of appliances and furniture reflects the specialized "white glove" delivery requirements for these products, where proper installation (such as connecting water lines for refrigerators or dishwashers) demands technical expertise and additional components.
As the industry evolves, stakeholders must balance regulatory considerations for independent contractors with the need to maintain high delivery performance standards and positive customer experiences. The growing utilization of freight brokerage models represents another strategic adaptation in this dynamic market segment.