Logistics Market

Global Industry Analysis (2017 – 2020), Growth Trends and Market Forecast (2021 – 2025)

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International Trade Boosts Demand for Managing Complex Logistics

The logistics industry plays a crucial role in enabling the trend of globalization as each business venture vies to expand internationally. As trading borders blur with better transportation facilities, the global logistics market is expected to witness a remarkable change and momentum.

Growth of the logistics market is directly proportional to the smooth operations of international trade and favourable economic conditions. Logistics are an indispensable part of economic activity and business economics. Similar to other industries the logistics industry has been confronting with immense changes. Some of which includes, change in technology, new competition, changing consumer expectations and ultimately transforming nature of business models.

With varied types of end customers, expecting more than one delivery option vis-à-vis same day, next day deliveries and last-mile services, the logistics solutions providers are being challenged to maintain B2B supple chain. From solutions ranging from cheapest and fastest, key players are constantly reinventing themselves.

Digitalization Brings in New Wave of Change

Rapidly evolving technology with the advent of e-commerce has disrupted the logistics industry. This has equally transformed the supply chain, introducing multiple channels to satisfy consumer demands. Major manufacturers and consumer goods companies are reinventing the wheel by retailing straight to the end customers via online platforms. Thus, an exponential rise in e-tailing is likely to boost the logistics demand in the foreseeable future.

Increasing outsourcing in the logistics market has also been a shot in the arm. Rising exports and imports are compelling producers to trade internationally and domestically with efficiency. These two factors have led to significant improvement in logistics infrastructure via IT deployments such Internet of Things (IoT) and data management software.

Better tracking solutions have built strong consumer confidence, giving the global logistics market a renewed reputation. Growth in online shopping and quicker deliveries including same-day deliveries are expected to keep these players in this market on their toes.

According to the World Economic Forum, urban demand for last-mile delivery in the world’s top 100 cities is expected to surge by 60% over the next decade.

COVID-19 Challenges Global Logistics Market with Lockdowns and Fear of Contamination

Austerity measures of lockdown to restrain the COVID-19 pandemic have the global logistics market. This has severely hampered demand-supply issues, raising concerns about business sustainability. During strict measures, problems related to sudden fluctuation in trade with limited labour force held back the market proliferation. However, with easing lockdowns, the bottled-up demand is expected to cheer up the market in the immediate future.

The pandemic caused short term disruptions, while it led to long term structural changes. These changes have been executed based on the soaring demand witnessed from groceries and health care products. Demand emanating from the daily needs and pharmacy products during the pandemic balanced out the demand fluctuation up to a certain extent. COVID-19 has been consistently pressurizing logistics services. The pandemic postured as a catalyst towards the improvements in unattended, contactless and autonomous delivery forms.

The global logistics market is likely to be driven by e-commerce platforms as demand for perishable items such as food and beverages will be catered via e-tailing. Similar trends will be seen in the healthcare sector.

Asia Pacific to Lead the Way as E-tailing Sectors Pick Pace

Asian countries are likely to be in the leading position in terms of market share. Introduction of e-commerce platforms, strong transportation infrastructure and increasing manufacturing activities are expected to bode well for the countries.

Asia Pacific is widely touted as a global logistic hub, with significant advancements in the e-tailing sectors. As a result, the international and domestic trade flow has grown substantially in Asian countries. South China Sea has been instrumental in the prospective development of logistics market for China. Similarly, Japan, India and ASEAN countries among others are major markets in the Asia Pacific region.

Delivery Robots to Determine Future of Global Logistics Market

Key players are focusing towards providing technology-laden logistic services. These services enable end customers to track their shipments through real-time tracking.

Many key players are exploring new ways to sustain the rising cost involved in goods delivery. Their efforts include ways of achieving cost-efficacy while introducing advancements such as robotic delivery systems. Deployment of robotic systems and autorotation has been a common sight in the logistic warehouses over the last couple of years. Robotic system implementation has entailed the key players with cost benefits and aided in time management with improved efficiency.

For instance, the introduction of Kiva Robots by Amazon assists the logistics department in packaging and transporting the goods. This in turn has assisted the logistics department in automation and raising the overall business efficacy.

Some of the key stakeholders steering the market growth are DB Schenker Logistics, Americold Logistics, C.H. Robinson Worldwide, Ceva Holdings, DHL Supply Chain, Expeditors International of Washington, FedEx, J.B. Hunt Transport Services, Kuehne + Nagel, Penske Logistics, Ryder Supply Chain Solutions, SNCF Logistics, The Boeing Company, United Parcel Service, XPO Logistics and DSV A/S among others.

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