New research from Transport Intelligence (Ti) reveals that the global contract logistics market grew 4.9% in real terms in 2018, one of the fastest growth rates seen in recent years. It paints a picture of a healthy market, with 2018’s expansion well above annual growth rates seen over much of the last decade.

Growth is expected to remain at such levels over the forecast horizon too, suggesting ongoing strength in core manufacturing and retail markets at a global level. Ti forecasts a slight slowdown in 2019, while looking ahead to 2023, Ti’s 5-year CAGR forecast for the global contract logistics market suggests an expansion rate of 4.7%.

The latest round of contract logistics market sizing reveals a mixed picture in major economies, however. In China, one of 95 markets for which contract logistics market sizing is available, the contract logistics market shows remarkable vigour with a 2018 growth rate of more than double the global rate powered by an expanding consumer market and the growth of advanced manufacturing fields such as robotics, IoT and 3D printing. In the US, the story in 2018 was reasonably positive, but while the contract logistics market grew, the rate of expansion was more modest and well below the global rate. The 5-year CAGR to 2023 for the US is muted at 2.0%.

“2018 was a strong year for contract logistics providers in many respects,” said Nick Bailey, Ti’s Head of Research. “While the fundamentals remain positive, players in the market need to take advantage and react to some significant changes in the market. Across key verticals like retail, pharmaceuticals, automotive and beyond, demands are changing and shippers are expecting higher levels of service, digital offers and greater end-to-end value. The pressure is on contract logistics providers to make sure their offer stays relevant.”

Analysis in the 2019 edition of Global Contract Logistics also places DHL Supply Chain well ahead of its nearest competitors XPO and Kuehne + Nagel as the largest contract logistics provider globally, with a 6.2% market share.

Andy Ralls, Quantitative Analyst at Ti, said, “The global market for contract logistics grew at a strong pace in 2018, down only slightly on what was an excellent year in 2017. There are some stark contrasts between the significant bright spots in China, India and South East Asia, when compared with developed markets in Europe, but even these are showing a reasonable level of expansion. This means that 3PLs across the world have had significant opportunities to grow their businesses.”

About Global Contract Logistics 2019

Ti’s latest market report, Global Contract Logistics 2019 is essential reading for those looking to understand how the contract logistics market is changing, key trends in 3PL operations and how the industry is responding to technological developments.

What are some of the reports key findings? 

  • The global contract logistics market grew by 4.9% in 2018.
  • The underlying trends in EV production suggest a significant change in the EV supply chain
  • Increasing automation in the warehouse will change the role of contract logistics providers
  • Top 10 contract logistics providers in Europe, Asia Pacific and North America
  • Analysis of the most important benchmarks and KPIs

The report also contains comparative analysis of leading contract logistics providers:

  • Approach to and implementation of technology
  • Approach to M&A
  • Financial performance – margins in contract logistics
  • New contract wins
  • Approach to strategic threats – deglobalisation, shifts in vertical sector