BANGALORE, India, May 11, 2020 /PRNewswire/ -- 3PL is the mechanism by which the producer outsources logistics and distribution-related activities. Third-party logistics companies usually specialize in integrated warehousing and transportation services activities, which can be customized and tailored to the needs of consumers, depending on market conditions. Services also expand beyond logistics to provide value-added services related to the manufacturing or purchase of products, such as services that incorporate supply chain elements.
The global Third-party Logistics (3PL) market size was valued at USD 1,027.71 Billion in 2019 and is projected to reach USD 1,789.94 Billion by 2027, at a 7.1 % CAGR from 2020 to 2027.
The report covers the global impact of the 2019 coronavirus disease (COVID-19) as a separate chapter.
One of the major reasons for the growth of the global 3PL market size is the development of the e-commerce industry and the increase in reverse logistics operations.
The growth of globalization has helped create a global network of manufacturing activities. Owing to the rise of globalization, numerous trade-related events have been observed to increase. Thus, manufacturers or distributors find it difficult to keep an efficient track of these activities. 3PL companies allow these manufacturers to keep track and monitor these activities. This is expected to drive the 3PL market size.
In addition, the reach of 3PL services is expected to increase during the forecast period, as efficiency gains in the supply chain in terms of cost and reliability can be extracted with the aid of managerial and IT expertise provided by 3PL firms.
The market has witnessed an increased concentration of retailers and manufacturers on their core business and sub-contracting operations, such as logistics, where they have less expertise. 3PL Companies can make efficient use of transport assets by balancing the needs of several shippers through transport and distribution functions, resulting in economies of scale. Management of this form of supply chain is extremely difficult for manufacturers; thus the 3PL market size is expected to grow during the forecast period, due to rise in manufacturers and retailers' emphasis on their core business (known as core competencies) and subcontracting operations, such as logistics where they have less expertise.
The Asia-Pacific region held the highest 3PL market share in 2019. This growth can be attributed to the economic growth of India and China. Implementation of Goods and Services Tax (GST) and the penetration of e-commerce are key factors leading to business growth in India. The GST is expected to dramatically reduce logistics costs, thus growing the Indian economy's competitiveness. Furthermore, growing ongoing investment in railways, bridges, and airways across the region's developing economies is expected to fuel demand in warehousing and logistics over the forecast period.
North America's 3PL market share is expected to show remarkable growth during the forecast period due to the rising demand for logistics software. Increased investment to boost route optimization and visibility are expected to increase regional demand for 3PL services.
Europe is expected to witness slow growth in the coming years due to continuing apprehensions regarding labor shortages and talent management. More efficient logistics operations are expected, with the U.K. spearheading the uptake of these services.
From 2016 to 2022, the global logistics market size is projected to experience a CAGR of 3.48 % and achieve a market size of about USD 12,256 Billion by 2022.
With the growing demand for various products across the globe, the international logistics market is experiencing significant growth. Logistics involves transport and warehousing.
Growing emerging economies' foreign trade activities, growing trade-related agreements and foreign logistics infrastructure, and advancements in the information technology and transport sector are the prime factors responsible for the growth of Logistics Market size.
It is estimated that the e-commerce logistics market size will reach USD 535.895 Billion by 2022, at a 21.2% CAGR.
Digital technology development has driven the e-commerce logistics adoption pace through a range of applications. Market growth is driven primarily by factors such as the rise of cross-border e-commerce activities, and the increase in internet penetration, especially in developing countries, will contribute to the growth of this market as it will exacerbate the total consumption of foreign products across different regions.
Transportation Management Systems (TMS) Market Report
In 2019, the global Transportation Management Systems market size was USD 2.453 Billion and it is expected to reach USD 6.633 Billion by the end of 2026, with a CAGR of 15.1% during 2021-2026. The transport management system (TMS) is a branch of transportation supply chain management and can be part of an enterprise resource planning framework
Third-party logistics (3PL) software helps businesses to organize and manage the logistics sector. 3PL software enables the fulfillment of orders, management of warehouses, coordination of shipping, tracking of inventories, and the setting up of billing
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