RALEIGH, North Carolina, Oct. 24, 2019 /PRNewswire/ -- The global market size for road freight services is currently growing at a CAGR of 4 - 5 percent yearly, according to Beroe Inc., a procurement intelligence firm. With the impact of Brexit, trade volume with emerging economies would expand in the next 4 - 5 years, which would result in improved road freight activity.
Regions such as Western Europe, North America, and Australia have a high maturity for buyer and supplier verticals due to advanced technology adoption. Due to the increase in e-commerce and global trade, APAC and parts of Africa are expected to be the future growth-driving markets for road freight services.
Beroe, which is based in North Carolina, further stated that procurement experts can access this report on its recently launched market intelligence platform Beroe LiVE: live.beroeinc.com
Retail sales will increase by 5 - 6 percent, which will drive the demand for trucking and ultimately overall road freight services. Since retail e-commerce is growing at 14 - 15 percent per annum, it will also create new demand for logistics, especially in metropolitan cities. However, the fuel prices are a major constraint in the road freight industry and hold nearly 30 - 35 percent of trucking freight rates.
The major cost components are labor and fuel costs, which comprise 55 - 60 percent of the total cost. The driver shortages in North America, Europe, and Australia with rising fuel costs would highly impact the overall costs and profit margins of the industry. The prevalent market wage rates for truck drivers and cleaners are expected to increase in the near future due to a shortage of skilled drivers and government regulations.
- Driver wages account for nearly 30 - 35 percent of carriers' operating costs, and driver wages are expected to increase due to the prevalent shortages in the industry.
- Growth in GDP implies increased economic activity, which is a positive correlation between the development of freight transport and GDP. Thus, an increase in GDP is directly related to the increase in road freight services.
- The threat from railways to road freight industry is high, but road transport players enjoy higher accessibility and provide customization so the threat remains between low to medium.
- Global suppliers provide value-added services in addition to transportation such as warehousing, end-to-end supply chain solutions, and inventory management, which streamlines the supply chain.
- With the new trucking service providers entering the market and suppliers increasing the service costs, shippers are moving and engaging with new providers for cheaper prices.
- The introduction of digital identifiers for accurate tracking of consignments is the new trend on the technological front of logistics and road freight services industry.
The research methodology adopted for the report included:
- Experts with twenty years of domain experience
- Interaction with buyers
- Inputs from supply chain partners
According to Porter's Five Forces Analysis, in developed markets such as North America and Europe, the shortage of skilled drivers coupled with high labor rates act as a deterrent to new players venturing into the market. In emerging markets such as APAC, intrusive regulatory regimes and the non-tradable nature of the market combined with the low level of market maturity makes the market difficult for new players.
The report also includes:
- Global Market Maturity
- Global Industry Trends
- Global Drivers and Constraints
- Regional Market Analysis
- Porter's Five Forces
- Supplier Trends and Insights
- Key Global Suppliers Service Portfolio
- Key Global Supplier Profiling
- SWOT Analysis
- Key Regional Supplier Profiling
Cost & Pricing Analysis:
- Pricing Models
- Pricing Models - Comparative Analysis
- Road Freight Index Overview
- Cost Structure - North America, Europe and the Asia Pacific
- Pricing Trends and Analysis
Payment Terms & Regulations:
- Payment Terms and Trucking Regulations in
- The U.S.
Procurement Best Practices:
- Sourcing Models
- Sourcing Models - Pros and Cons
- Industry Sourcing Model Adoption
- KPIs and SLAs
End-User Industry Update:
About Beroe Inc.:
Beroe's unique business model involves providing market intelligence and analytics to the procurement teams of businesses across the globe. Beroe leverages its deep domain expertise in 300 + categories across 14 industries. It boasts of more than 80 of the Fortune 500 companies as its clients.
To learn more about Beroe Inc, please visit http://www.beroeinc.com
SOURCE Beroe Inc.