Third-party Logistics Market (By Service: DTM, ITM, DCC, VALs, and W&D; By Transport: Railways, Roadways, Airways, and Waterways; By End-use: Retail, Manufacturing, Automotive, Healthcare, and Others) - Global Industry Analysis, Size, Share, Growth, Trends Analysis, Regional Outlook and Forecasts, 2021 - 2027

The global third-party logistics market was valued at USD 919.12 billion in 2020 and is projected to hit US$ 1710.58 Bn by 2027, expected to grow at a compound annual growth rate (CAGR) of 8.3% from 2021 to 2027.

Growth Factors

Accelerating growth of e-commerce and retail sector along with the introduction to new technologies in logistics such as advanced driver assistance system and adaptive cruise control system are thriving the growth of third-party logistics market. The market for third-party logistics expected to seek exponential growth in the upcoming years owing to rapidly changing global supply chain structure towards more customer-centric. This also encourages most of the companies to outsource their supply chain for focusing more towards responsiveness and adaptability.

In addition, complex documentation process and customs rules and regulations have triggered more to outsource supply chain in order to focus more towards customer satisfaction and demand fulfillment. As a result, medium and small-sized companies are also leveraging third-party logistics.

Moreover, the rise of internet and e-commerce business has accelerated the growth third-party logistics. Changing customer buying behavior and expectation has greatly influence the market and brought alluring opportunities in the market area. This has significantly increased omni-channel operations coupled with rising end-user expectation in terms of cost, convenience, choice, and control also thrive the third-party logistics market growth.

Service Insights

Domestic Transportation Management (DTM) held majority of market share nearly 30.3% in the year 2020. This is mainly attributed to the surge in cross-docking services, escalating carrier rates, and rising fuel surcharge. In addition, continuous growth in the sectors such as healthcare, retail, and steady Gross Domestic Product (GDP) growth of various countries are further escalating the growth of DTM market.

Moreover, continuous growth in international trade expected to flourish the growth of the segment in the coming years. This is mainly influenced by the cross-border logistics activity and trade liberalization policies. Free trade agreement between several countries to promote their international trade aids to the growth of DTM market. For instance, Progressive Trans-Pacific Partnership (CPTPP) and the African Continental Free Trade Area (AfCFTA) are the recent examples of free international trade agreements.

Transport Insights

Roadways segment dominated the third-party logistics market in 2020 accounting for more than half of the market share. Rising public-private partnerships coupled with increased emphasis on the logistics infrastructure are propelling the growth of the segment. In addition, the segment expected to exhibit accelerating growth owing to recent advancements in the vehicles along with supporting government regulations for roadways.

Airways segment estimated to forecast the fastest growth rate during the upcoming years. This is mainly attributed to the increasing necessity for fast and effective delivery system. These days, consumers are more focused towards services that are fast and cost-effective. However, COVID-19 outbreak in 2020 has significantly impacted the air freight business.

End-use Insights

The manufacturing segment held the majority of market revenue share of approximately 25.5% in the year 2020. This is mainly because manufacturing sector involves large number of suppliers and distributors for the procurement of raw materials and distribution of their products that makes logistics a tedious task for them. Henceforth, manufacturing sector occupy majority share in procuring third-party logistics services to save their time from supply chain maintenance and focus more towards customer satisfaction.

Regional Insights

North America occupied majority of revenue share of nearly 25.4% in the year 2020 and anticipated to exhibit a steady growth over the forecast period. The U.S. is leading the North America region with magnificent market share. This is mainly due to the presence of key players in the region such as XPO Logistics, Inc.,C.H. Robinson Worldwide (CHRW) Inc.,UPS Supply Chain Solutions Inc, and many others. Other than this, rising demand for cold storage in the region expected to boost the regional market growth.

The Asia Pacific anticipated exhibiting the fastest growth rate during the upcoming years. This is owing to the increasing trans-regional trade activities along with surge in manufacturing sectors in the developing and underdeveloped countries. Besides, technology advancement in the transportation and logistics sector along with introduction to advanced software for better management of supply chain in the Asia Pacific region has also created alluring opportunity for third-party logistics in this region.

Key Companies & Market Share Insights

Third-party logistics market is a fragmented market and players present are more focused to maintain their market position by adopting various marketing strategies. Besides, market leaders also adopting merger & acquisition strategy to increase their market share and jump their positions in the market. For example, in November 2019, Roadrunner Intermodal Services, LLC was acquired by Universal Logistics Holdings, Inc. to expand their logistics services across North America.

Some of the prominent players in the third-party logistics market include:

  • Burris Logistics
  • CEVA Logistics
  • C.H. Robinson Worldwide (CHRW) Inc.
  • DB Schenker Logistics
  • FedEx Corporation
  • BDP International
  • UPS Supply Chain Solutions, Inc.
  • Kuehne + Nagel International AG
  • J.B. Hunt Transport Services, Inc.
  • Nippon Express Co., Ltd.
  • XPO Logistics, Inc

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Precedence Research has segmented the global third-party logistics market report on the basis of service, transport, end-use, and region:

Service Outlook

    • Domestic Transportation Management (DTM)
    • International Transportation Management (ITM)
    • Dedicated Contract Carriage (DCC)/ Freight forwarding
    • Value-Added Logistics Services (VALs)
    • Warehousing & Distribution (W&D)

Transport Outlook

    • Railways
    • Roadways
    • Airways
    • Waterways

End-use Outlook

    • Retail
    • Manufacturing
    • Automotive
    • Healthcare
    • Others

Regional Outlook

    • North America
      • U.S.
      • Canada
    • Europe
      • U.K.
      • Germany
      • France
    • Asia Pacific
      • China
      • India
      • Japan
      • South Korea
    • Rest of the World
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Why third-party logistics?
Third-party logistics is a method by which manufacturers outsource their logistics and distribution services. A third-party logistics companies provide various services to its customers that include cross-docking, inventory management, packaging of products, and door-to-door delivery. These companies provide fast supply chain services in cost-effective way. In addition, the outsourcing of supply chain services by the manufacturing companies reduces their shipping & delivery cost, inventory cost, as well as meet the technical requirement that increases their capability to focus more towards the product development and other growth strategies.
The global third-party logistics market size was valued at USD 919.12 billion in 2020 and is projected to hit US$ 1710.58 Bn by 2027.
The global third-party logistics market is expected to grow at a compound annual growth rate (CAGR) of 8.3% from 2021 to 2027.
Rising e-commerce and retail businesses are significantly escalating the demand for third-party logistics. Main factors contributing towards the growth of e-commerce business are changing consumer purchasing behavior, easy availability of the products over internet, no need to go out for shopping in the digital world, and many others. Additionally, growing demand for fast and cost-effective logistics services also aid in the growth of the third-party logistics market. Hence, the market anticipated to witness profound growth over the forecast period.
North America occupied majority of revenue share of nearly 25.4% in the year 2020 and anticipated to exhibit a steady growth over the forecast period.
The transport segments of third-party logistics market are Railways, Roadways, Airways and Waterways.
Some of the key players of the third-party logistics market are Burris Logistics, CEVA Logistics, C.H. Robinson Worldwide (CHRW) Inc., DB Schenker Logistics, FedEx Corporation, BDP International, UPS Supply Chain Solutions, Inc., Kuehne + Nagel International AG, J.B. Hunt Transport Services, Inc., Nippon Express Co., Ltd., and XPO Logistics, Inc among others.


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