July 16, 2024
Contract Logistics Market

Contract Logistics Market is Estimated to Witness High Growth Owing to Increased Supply Chain Complexities

Contract logistics involves outsourcing logistics and supply chain activities to third-party logistics service providers. It includes warehousing, transportation, cross-docking, inventory management, packaging, and freight forwarding. Contract logistics services help companies focus on their core competencies by outsourcing logistics activities. They provide cost-effective solutions by leveraging economies of scale. With growing international trade and complex supply chains, the need for efficient logistics services has increased. Contract logistics providers use advanced technologies like IoT, AI, and analytics to improve visibility and optimize operations.

The Global Contract Logistics Market is estimated to be valued at US$ 461.27 Bn in 2024 and is expected to exhibit a CAGR of 7.3% over the forecast period 2024 to 2031.

Key Takeaways

Key players operating in the Contract Logistics are CJ Logistics Corporation, Kuehne Nagel, Deutsche Post AG, Ryder System, Inc., A.P. Moller – Maersk, CEVA LOGISTICS, United Parcel Service of America, Inc., YUSEN LOGISTICS CO., LTD., DB Schenker, Penske, DSV, XPO Logistics Inc., LOGISTEED, Ltd., Neovia Logistics Services, LLC., Agility, GEODIS, Hellmann Worldwide Logistics. The key players are focusing on mergers and acquisitions to expand their service portfolio and global footprint.

The key opportunities in the Contract Logistics Market Trends include growing e-commerce industry, investments in cold chain logistics infrastructure, and multi-client warehousing facilities. The global expansion of the market is being driven by companies setting up shared distribution centers and expanding into new geographies.

Market Drivers

Increased supply chain complexities owing to globalization is a key driver for the contract logistics market. With international suppliers and manufacturers, companies require reliable logistics partners to ensure seamless movement of goods across borders. Other drivers include focus on core competencies by companies due to lack of in-house logistics expertise. Further, evolving customer demands such as faster delivery, transparent tracking, and flexible inventory management necessitate contract logistics services.

PEST Analysis

Political: The contract logistics market is influenced by government policies and regulations related to transportation and warehousing. Changes in trade policies, import/export laws can impact market dynamics.

Economic: The market is dependent on the economic growth and industrial activity in key sectors like manufacturing, retail, healthcare etc. Economic recession or slowdown in these sectors adversely affects demand for contract logistics services.

Social: Evolving customer preferences, focus on sustainability and carbon footprint are shaping trends in the market. Growing e-commerce is generating demand for efficient supply chain and logistics services.

Technological: Advanced technologies like IoT, AI, blockchain, automation are being adopted by logistics companies to improve visibility, tracking and optimize operations. Technology helps improve efficiency, reduce costs and enhance customer experience.

Geographical regions where the Contract Logistics Market Regional Analysis is concentrated in terms of value include North America, Western Europe and Asia Pacific. North America accounts for the largest share currently led by the US due to size of the manufacturing and retail industries.

The Asia Pacific region is poised to be the fastest growing market during the forecast period supported by rapid economic development, rising consumerism, expansion of manufacturing sector and growth in international trade across countries like China, India, Japan, South Korea. This will generate strong demand for modern logistics infrastructure and third party logistics services in the Asia Pacific region.

*Note:
1. Source: Coherent Market Insights, Public Source, Desk Research
2. We have leveraged AI tools to mine information and compile it
About Author - Ravina Pandya

Ravina Pandya,a content writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemicals and materials, etc. With an MBA in E-commerce, she has expertise in SEO-optimized content that resonates with industry professionals.  LinkedIn Profile

About Author - Ravina Pandya

Ravina Pandya, a content writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemicals and materials, etc. With an MBA in E-commerce, she has expertise in SEO-optimized content that resonates with industry professionals.  LinkedIn Profile

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