Third-Party Logistics Market Expected to Pass $1.1 Trillion by 2022
An Allied Market Research report found that the global third-party logistics market is expected to reach $1.1 trillion over the next six years.The result would be a 5.16% compound annual growth rate, according to the research firm.
“The scope of 3PL services is expected to increase as productivity gains in supply chain in terms of cost, and reliability can be derived with the help of managerial and information technology expertise provided by 3PL companies," according to the report. Increase in the e-commerce industry and reverse logistics operations are also driving the market of 3PL industry.
“The market of 3PL is still fragmented, with plenty of room for growth. With number of orders increasing in small amount of time, the opportunity or challenge to the 3PL companies will be to meet the demand by completing more orders at lower cost with the help of multichannel distribution.”
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The researchers also found that trucking and rail freight will be the major modes of transportation over the next six years, with intermodal continuing to play an important role.
The annual State of Logistics report from the Council of Supply Chain Management Professionals, released last month, addresses the issues facing the logistics market over the next 10 years. It found that technology adoption, macroeconomic trends, operational constraints and customer requirements will be factors in what researchers call “major changes” over the next decade.
Among the technological changes could be autonomous vehicles, artificial intelligence, the "Uberization" of logistics, 3D printing and alternative fuels. From the consumer’s perspective, the researchers believe pressures for omnichannel shopping and the “want it now” mentality also will challenge the 3PL market. From a political perspective, the report also found that free trade agreements, environmental legislation and safety rules will continue to be factors in the future of 3PL firms.
