The global third-party logistics market size accounted for USD 1.10 trillion in 2022 and it is projected to hit USD 2.43 trillion by 2032, expected to grow at a CAGR of 8.25% from 2023 to 2032.
Third-party logistics is a method by which manufacturers outsource their logistics and distribution services. A third-party logistics companies provide various services to its customers that include cross-docking, inventory management, packaging of products, and door-to-door delivery. These companies provide fast supply chain services in cost-effective way. In addition, the outsourcing of supply chain services by the manufacturing companies reduces their shipping & delivery cost, inventory cost, as well as meet the technical requirement that increases their capability to focus more towards the product development and other growth strategies.
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| Report Highlights | Details |
| Growth Rate from 2023 to 2032 | CAGR of 8.25% |
| Market Size in 2023 | USD 1.19 Trillion |
| Market Size by 2032 | USD 2.43 Trillion |
| Base Year | 2022 |
| Forecast Period | 2023 to 2032 |
| Segments Covered | By Service, By Transport and By End-use |
| Regional Scope | North America, Europe, Asia Pacific, Middle East & Africa, Latin America |
Growth Factors
Rising e-commerce and retail businesses are significantly escalating the demand for third-party logistics. Main factors contributing towards the growth of e-commerce business are changing consumer purchasing behavior, easy availability of the products over internet, no need to go out for shopping in the digital world, and many others. Additionally, growing demand for fast and cost-effective logistics services also aid in the growth of the third-party logistics market. Hence, the market anticipated to witness profound growth over the forecast period.
Apart from this, increasing tilt of manufacturing businesses to outsource their supply chain also provides significant escalation to the third-party logistics market. Earlier, these businesses invest largely on maintaining their supply chain and inventory as they need to manage their logistics from raw material procurement to finished product distribution process. By outsourcing supply chain process, manufacturers are now free from warehouse management, inventory management, and focus more towards their market growth strategies.
However, COVID-19 outbreak in the early 2020 has significantly impacted the global supply chain. The logistics network has also been disrupted due to stringent regulations imposed by the government in order to prevent the rapid spread of virus. Several third-party logistics companies are facing uncertainty for the movement of their goods. In addition, lack of human resource and less working hour have also impacted badly on the third-party logistics market.
Report Highlights
Read Also: Intelligent Transportation System Market Size to Hit US$ 65.33 Bn by 2032
Regional Snapshots
North America led the global third-party logistics market and hold significant share nearly 25.4% in the year 2020. Rise in the domestic and international trade has significantly impacted the third-party logistics market growth in North America region. United States is the front-runner in the North America region and captured nearly 70% of the market revenue. As per World Trade Organization (WTO), merchandise exports to the United States have significantly increased from the year 2017 to 2018. Because of growing trade activities customers are also demanding timely delivery of product and efficient operations of the process.
On the other side, the Asia Pacific exhibits the fastest growth rate over the upcoming years owing several policies for trade liberalization coupled with rapid growth in the manufacturing sector in developing as well as under-developed countries. China, India, South Korea, Japan, and Taiwan are some of the rapidly developing countries in terms of manufacturing, transportation, and industrialization that account to propel the market growth in the region. For instance, the Government of India has set the Logistics Efficiency Enhancement Program (LEEP) for the development of multi-model logistics park.
Key Players & Strategies
The prominent players in the market are more focused to include technological advancements to their services that include route optimization, real time tracking of shipments, and advanced driver assistance systems. These technologies help companies to maintain complete visibility during the entire supply chain.
Moreover, some market players are also highly focused towards inorganic strategies of growth such as merger & acquisition, partnership, regional expansion, and many others. For instance, in August 2019, Panalpina Welt transport Holding AG, a logistics company based at Switzerland was acquired by DSV. This increases the competitive value of the company in the market.
Some of the prominent players in the third-party logistics market include:
Segments Covered in the Report:
By Service
By Transport
By End-Use
By Geography
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