Warehousing and Transportation is Expected to Dominate the Global Third-party Logistics (3PL) Market

The third-party logistics model delivers greater asset utilization and asset sharing alliances, which increases its demand, and contributes toward the growth of the 3PL market.

According to TechSci Research report, “Global Third-party Logistics (3PL) Market - Industry Size, Share, Trends, Competition Forecast & Opportunities, 2028”. Global Third-party Logistics (3PL) is anticipated to project robust growth in the forecast period with a CAGR of  9.9% through 2028.   E-commerce shippers are increasingly turning to 3PL providers to help them meet changing customer expectations and deal with supply chain disruption, labor constraints, transportation issues, inflation, and other challenges that have become the "new normal" in today's operating environment. As a result, 3PLs are offering shippers strategic locations, more space to accommodate higher inventory volumes, and a wider range of delivery options. As the volume of returns has increased in the last year, e-commerce shippers want to work with 3PLs that can help customers with the returns process. Omni-channel logistics services are also in high demand, with automation serving as a critical component of e-commerce fulfillment processes.

The larger 3PLs have multiple e-commerce operations, such as Geodis, DHL, Ryder, and JD Logistics (in Asia), to name a few of the larger players. Smaller providers have followed suit and now offer e-commerce fulfillment as well. In most cases, these 3PLs have e-commerce fulfillment operations separate from their traditional business-to-business (B2B) warehousing operations. More 3PLs will be needed in the future to add value in the last mile of the supply chain, where getting large and bulky items from the final point of distribution to the customer's location remains a major challenge. Getting furniture, fitness equipment, and other large items to customers' doors requires extra planning, especially if they require quick delivery.

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In a competitive and growing market, the last two years, 2020-22, have taught us that we must be both flexible and agile. In 2021, unprecedented growth in online retail was expected, particularly in direct-to-consumer services. The provision of omnichannel services, in which customers enjoy a unified shopping experience regardless of channel, is a major focus. This could be done in-store, online, on mobile, or through social media. Customers now expect a more seamless experience, lower prices, faster shipping, and a greater emphasis on sustainability. One of the most difficult challenges has been the extraordinary demand in the grocery and apparel segments, where one-day deliveries or less are becoming the norm. There was a global shortage of transport capacity and a limited supply of delivery drivers in 2021.

Quick commerce is being adopted by industries such as grocery, pharmaceuticals, and e-commerce. Companies and brands are replacing traditional business models and distribution channels with digital platforms to improve their delivery services by leveraging available technological advancements. This market is typically distinguished by delivery times of less than 20 minutes. The order size, value, and weight are typically small(er) and easily transported via two-wheelers, drones, or small vehicles. The 3PL, on the other hand, has already grown to become an important stakeholder in the supply chain network. With the growing demand for resource-backed fulfillment services, such as improved delivery management software, acute logistics optimization, and increased use of smaller warehouses in urban areas, reliance on 3PLs will only increase.

With delivery volumes increasing all over the world, particularly due to the rapid growth of eCommerce, supply firms are looking for innovative, cost-effective, and efficient approaches to last-mile delivery. This has resulted in investments and trials of cutting-edge technology such as driverless cars, delivery bots, and drones. Aurora (self-driving technology) from Amazon is a prime example.

Key market players in the Global Third-party Logistics (3PL) Market are following:-

• Geodis
• DHL International GmbH
• db Schenker
• a.p. moller - maersk, Kuehne+Nagel Inc.
• XPO Logistics Inc.
• C.H. Robinson Worldwide, Inc.
•  FedEx Corporation
• United Parcel Service of America, Inc.
• DSV

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“.Logistics is the core area of the third party logistics (3PL) firms and their proficiency in this areas is always superior to that of the core companies. 3PL firms have the expertise to keep IT systems updated and deliver the logistic services more time & cost effectively along with this they own the ability to meet the technical requirements. Moreover, 3PL firms also help to reduce inventory cost and can strategize to reduce a company’s overall shipping & delivery costs as well. The core companies may not have that time or expertise to keep logistic services and systems updated. The company often face challenges meeting timely delivery of products during high business growth. Outsourcing logistic function from a third party is helpful for core companies as these firms manage and maintain warehouse, transportation, and other operations with more efficiently with expertise. ”  said Mr. Karan Chechi, Research Director with TechSci Research, a research-based  global management consulting firm.

Third-party Logistics (3PL) Market – Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented    By Mode of Transport (Railways, Roadways, Waterways, Airways), By Service Type (Dedicated Contract Carriage (DCC), Domestic Transportation Management, International Transportation Management, Warehousing and Transportation, Others), By Industry (Technological, Automotive, Retailing, Elements, Food and Beverages, Healthcare, Others), By Region, By Competition, 2018-2028 has evaluated the future growth potential of Global Third-party Logistics (3PL) Market and provides statistics and information on market structure, size, share, and future growth. The report is intended to provide cutting-edge market intelligence and help decision makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities present in the Global Third-party Logistics (3PL) Market.

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