3PL in the worldwide perspective
Armstrong & Associates (A&A), a publisher of third-party logistics (3PL) market information and consulting, has released its latest research report. According to the study “Downshift: Latest Global and Regional Logistics Costs and Third-Party Logistics Market Trends and Outlook,” global 3PL market revenues surged 31.5% to USD 1.4 trillion in 2021.
One of the interesting findings was that generally more developed countries with high Covid‐19 vaccination rates further opened their markets and saw consumer spending increase.
3PL was a key beneficiary of supply chain management price inflation. This rapid growth trend continued through H1/2022. Then in Q3/2022, ocean shipping rates and domestic transportation rates began to disinflate. China to USA and European ocean shipping rates have declined as much as 90% since the peak in early 2022.
Logistics is a cyclical industry and demand destruction will negatively impact its growth in 2023. On the plus side, 2022 ended with China reversing its zero-Covid policy and many Southeastern Asia countries have opened up. This will drive increased demand in Asia going into 2023 and provide a tailwind to the overall global 3PL industry, the authors of the study concluded. (sh)