Market Research Report
Global Logistics Market - 2021-2028
|Published by||DataM Intelligence||Product code||982627|
|Published||Content info||180 Pages
Delivery time: 2 business days
|Global Logistics Market - 2021-2028|
|Published: July 15, 2021||Content info: 180 Pages||
Logistics is a management of the flow of goods from one point of origin to the point of consumption, to meet the requirement of customers. The logistics sector is largely dependent on the global economic situation and international trade flows. The assets managed in logistics can contain physical items, such as food, animals, materials, equipment and liquids, as well as intangible items, such as information, particles, and energy. The logistics market in the emerging countries is estimated to offer above average growth rates. Increasing in global trade activities of the developing economies, rise in trade related agreements and global logistics infrastructure and advancement in information technology and transportation sector are the prime factors responsible for the growth of global market. However, rise in pollution level and high inventory cost & low warehousing space are restraining the logistics market growth. Irrespective of the challenges, rise in adoption of green logistics solutions is creating an opportunity to the market growth. The global logistics market valued USD XX million in 2020 and is forecasted to reach USD XX million by 2028, growing at a CAGR of XX% during the forecast period (2021-2028)
Market Dynamics: Rise in trade related agreements
Dynamic market conditions and improvement in global economy are the key factors driving globalization. Owing to rise in globalization, various activities related to trade are witnessing increase. Hence, it is becoming difficult for manufactures or retailers to keep track of these activities in an efficient manner. This factor is expected to drive the logistics market for logistics companies. Moreover, development of the overseas market is a significant factor that fuels the growth of the market. Logistics services are becoming extremely vital for price-sensitive customers who require a wider choice of high-quality products with timely delivery. Thus, increase in trading activities due to globalization fuels the growth of logistics market.
Reduction in cost of transportation and timely delivery of goods pose a challenge to logistics service providers to increase profitability. Amount of orders to be delivered in limited time is rising, as a result of which logistics companies have the opportunity to use multi-modal transportation system to increase efficiency of the supply chain. For example, APL logistics provides ShipMax solution to its customers. It includes pairing with compatible trucking partners as well as allows customer to take advantage of better load utilization and delivery optimization, thus enabling customers to maximize transportation budget. Hence, cost cutting and lead time reduction by adopting multi-modal system poses exponential growth opportunities for the key players operating in the logistics market.
However, lack of control of manufacturers on logistics service is expected to hinder the market growth. By using logistics service, a manufacturing company has to rely on the reliability, competency, and honesty of service providers. In this scenario, manufacturer has to rely on logistics provider, which results into lack of direct control. In addition, manufacturer is not able to monitor the operations at warehouse, which is a serious threat to the quality of products.
Market Segmentation: Manufacturing and automotive segment is expected to dominate the global logistics market, by end-user
The global logistics market has been segmented by end-user into manufacturing & automotive, oil & gas, mining & quarrying, agriculture, fishing & forestry, and construction among others. The manufacturing & automotive segment is expected to hold the highest market share in the year 2020. Factors such as the policy reforms that have improved the ease of doing business along with the easy availability of cheap labor contribute to the growth of the market. Moreover, globalization coupled with population growth and consumption behavior has seen ever-increasing demand for products from all corners of the world. The rise of e-commerce has added to the transport boom, and over the past decade, a considerable growth has been seen across the industry's value chain as a whole. In terms of growth of the wider industry, logistics infrastructure will see almost across the board real growth in the years between 2021 and 2028.
Geographical Penetration: Asia Pacific is the largest market for logistics with a share of nearly XX% in 2020
By geography, Asia Pacific is expected to dominate the global logistics market, followed by North America in the year 2020, growing with a CAGR of xx% during the forecast period. The growth of the global market is directly related to the growth of global international trade flow and economic environment. Asia Pacific and North America appeared to be the most attractive markets for logistics particularly in contract logistics such as fourth party logistics and second party logistics. Intra-regional trade in emerging markets is becoming important, particularly in Asia Pacific.
United States held highest market share in the North America logistics market. Logistics-trucking, warehousing, and other transportation and storage activities related to the flow of goods makes up almost 8 percent of the US economy (7.6% in 2019). 2020 is expected to be a challenging year for the country's freight transportation and logistics. COVID-19 has been more economically damaging than a standard recession or an escalation of trade tensions. The GDP declined by 1.2 percent in the first quarter of 2020, and unemployment rose to 14.7 percent in April. Road freight is the most significant segment of the US logistics market. The disruptions of COVID-19 have scrambled capacity across all the logistics sectors. However, the pandemic has accelerated an already fast growth in e-commerce, which has different logistics needs than traditional retailing.
The global logistics market is fragmented. A few major market players operating in the global logistics market are XPO Logistics Inc., Ceva Holdings LLC, C.H. Robinson Worldwide, Inc., and FedEx Corp., among others. Key players are focusing on strategies such as geographical expansion, and technological innovation.
COVID-19 Impact: Lower economic activity on account of COVID 19
Consumer spending and industrial production drive freight movement, so the growth in logistics demand will follow overall economic growth in different countries. The pandemic, and global measures taken to reduce its further spread, have decimated supply chains, scrambled logistics capabilities, and destroyed huge swaths of demand. The outlook for the global economy over the next two years remains highly uncertain. The sharp fall in economic activity in the first half of 2020 is expected to contribute to a contraction in the global trade of about 13.4 percent in 2020. World trade is set to plummet by between 13 and 32% in 2020 due to the COVID-19 pandemic, according to The World Trade Organization (WTO). The decline will likely exceed the trade slump brought on by the global financial crisis of 2008-09. The recovery of logistics market prospects is likely to vary depending on the length of lockdowns and the duration of the succeeding economic crisis, as logistics is a diverse sector.