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Global Third-Party Logistics Market was valued at US$ 1,112.6 Bn in 2022 and is estimated to reach US$ 2,349.2 Bn by 2031. The market is registering a growth at a CAGR of 8.7% during the forecast period 2023-2031.
Third-Party Logistics (3PL) is an essential and rapidly growing business sector that offers a wide range of services to help companies manage their transportation, warehousing and distribution needs. 3PL provides critical business solutions by taking on the practical tasks that many companies would rather not do themselves. These third-party services can include inventory management, order fulfillment, transportation management, warehousing, reverse logistics, parcel delivery, and other related services.
Providers in the global third-party logistics market offer these services to businesses in a variety of industries, such as retail, manufacturing, food and beverage, medical and pharmaceutical, automotive, and more. The goal of 3PL is to optimize supply chain operations and reduce costs, while increasing customer satisfaction. 3PL providers are also able to customize services to meet the specific needs of each customer, making them a great choice for companies looking to streamline their operations.
However, there are some challenges associated with the use of 3PL services. One such challenge is the issue of over dependency, which arises when businesses contract with 3PL providers. This dependency puts the client company in a vulnerable position and can lead to uncomfortable situations.
By Mode of Transport
In 2022, the roadways segment dominated the mode of transport market with the highest market share (44%) and is expected to maintain its dominance in the forecast period. The growth of this segment is being driven by various government initiatives, such as the recent regulations imposed by the Federal Motor Carrier Safety Administration.
These regulations permit the use of cameras as an alternative to rearview mirrors, improving safety for truck drivers. The global third-party logistics market indicate that the road transportation industry is poised for significant growth, driven by increasing demand for efficient and cost-effective transportation solutions. As a result, various market players are investing in developing advanced technologies and expanding their logistics network, further fueling the growth of the roadways segment.
The global third-party logistics market is segmented into Dedicated Contract Carriage (DCC), Domestic Transportation Management (DTM), International Transportation Management, Warehousing & Transportation, and others. In 2022, the DTM segment holds the largest share in the market, with reports indicating its continued growth in the forecast period. The growth of the DTM segment can be attributed to various factors, such as the increasing trade movement from unloading docks to warehouses, rising carrier rates, a surge in cross-docking services, and an increase in fuel surcharges. These trends have prompted market players to focus on expanding their DTM services, leading to increased competitiveness in the market.
Additionally, the growing e-commerce sector, advancements in transportation technology, and changing consumer preferences for faster and more efficient delivery services have created new opportunities for market growth. Market reports predict that the global third-party logistics market will continue to experience substantial growth in the coming years, driven by these and other factors.
By End User
The technological segment is the largest end-user segment (26.8%) of the third-party logistics market in 2022, and is expected to register the highest compound annual growth rate (CAGR) during the forecast period 2022-2027. The introduction of mobile technology is revolutionizing the 3PL industry, with many companies adopting the use of mobile devices and apps to improve their operational agility and efficiency. The increasing demand for real-time tracking and monitoring of shipments, as well as the need for instant access to information, is driving the adoption of mobile technology in the third-party logistics market.
The Market reports indicate that the integration of mobile technology with other digital tools, such as big data analytics and artificial intelligence, is leading to significant advancements in the third-party logistics market. This, in turn, is driving the demand for advanced logistics services, such as predictive analytics and automation, further propelling the growth of the technological segment. Market players are investing in research and development to stay ahead of the competition and offer innovative solutions to their customers, which is expected to drive the growth of the market in the coming years.
The global third-party logistics (3PL) market is segmented into five major regions: North America, Europe, Asia-Pacific, South America, and Middle East & Africa.
North America: North America is one of the largest markets for 3PL services, with the U.S. being the largest contributor. The region is characterized by a well-developed transportation infrastructure, an established e-commerce sector, and a highly educated workforce, making it an attractive market for 3PL providers. Market reports indicate that the growing demand for efficient and cost-effective logistics solutions, along with the increasing adoption of digital technologies, is driving the growth of the third-party logistics market in North America.
Europe is also a significant market for 3PL services, with Germany, the UK, and France being the key contributors. The region is characterized by a well-established transportation network, a large number of small and medium-sized enterprises, and a mature e-commerce sector. These factors, combined with the increasing demand for more efficient logistics solutions, are driving the growth of the third-party logistics market in Europe.
The Asia-Pacific region is the largest (38.8% share) and fastest-growing third party logistics market, with China, Japan, and India being the key contributors. The region is characterized by a rapidly growing e-commerce sector, a large number of small and medium-sized enterprises, and a rapidly expanding transportation infrastructure. These factors, combined with the increasing demand for efficient and cost-effective logistics solutions, are driving the growth of the third-party logistics market in the Asia-Pacific region.
The global third-party logistics market is highly competitive, with a presence of numerous international and regional players. Key players in the market include DHL International GmbH, Kuehne+Nagel Inc., DB Schenker, Nippon Express, and FedEx Corporation.
List of Key Companies Profiled:
The following are the different segments of the global third-party logistics market:
By Mode of Transport segment of the global third-party logistics market is sub-segmented into:
By Service segment of the global third-party logistics market is sub-segmented into:
By End User segment of the global third-party logistics market is sub-segmented into:
By Region segment of the global third-party logistics market is sub-segmented into:
|Market Size Value in 2022||US$ 1,112.6 Bn|
|Expected Revenue in 2031||US$ 2,349.2 Bn|
|Unit||Value (USD Bn)|
|Segments covered||By Mode, By Service, By End User, By Region|
|Key Companies||DHL INTERNATIONAL GmbH (DEUTSCHE POST DHL GROUP), KUEHNE+NAGEL INC., DB SCHENKER (DB GROUP), NIPPON EXPRESS, C.H. ROBINSON WORLDWIDE, INC., UNION PACIFIC CORPORATION, FEDEX CORPORATION, UNITED PARCEL SERVICE (UPS), PANALPINA WORLD TRANSPORT LTD., MAERSK, Other Prominent Players|
|Customization Scope||Get your customized report as per your preference. Ask for customization|
A 3PL company can provide specialized services such as inventory management, cross-docking, door-to-door delivery, and packaging of products.
Global Third-Party Logistics Market was valued at US$ 1,112.6 Bn in 2022.
Global Third-Party Logistics Market is estimated to register a CAGR of 8.7% during the forecast period 2023-2031.
Third-party logistics market is driven by factors such as increase in trade activities due to globalization and rising focus of manufacturers and retailers on core competencies.
Over dependency of businesses on 3PL companies hinders the market growth.
Pooled warehousing is an emerging opportunity in the 3PL market.
Roadways segment has the highest share in the third-party logistics market in 2022.
Domestic Transport Management service has the highest share in the 3PL market in 2022.
Technological segment is the highest shareholder of the third-party logistics market in 2022.
Asia Pacific dominates the Global Third-Party Logistics Market.
The key players in the third-party logistics market are DHL, KNL, Nippon, DB Schenker, and C.H. Robinson among others.