The Contract Logistics Market is estimated to reach US$ 298.8 Bn by 2028-The Insight Partners.

the contract logistics market is estimated to reach US$ 298.8 Bn by 2025 from US$ 203.9 Bn in 2017. The report include key understanding on the driving factors of this growth and also highlights the prominent players in the market and their developments.


Contract Logistics Market to 2028 - Global Analysis and Forecasts by Type (Outsourcing and Insourcing); Services (Transportation, Warehousing, Packaging Processes and Solutions, Distribution, Production Logistics, and Aftermarket Logistics); and End-user (Aerospace, Automotive, Consumer, High-Tech, Industrial, Pharma Healthcare, and Retail)

the contract logistics market is estimated to reach US$ 298.8 Bn by 2025 from US$ 203.9 Bn in 2017. The report include key understanding on the driving factors of this growth and also highlights the prominent players in the market and their developments.
The advent of internet had taken global business markets by storm at the start of the 21st century. Countries and regions that realized its potentials have made most of the business opportunity provided by the internet and have been successful in improving their economies. With the rollout of internet, different business models were created and e- commerce is one such example. The E- commerce industry gathered pace in the early part of this decade with advancements in the internet infrastructures speed, as well as increasing smartphones and internet penetration among the users. E- commerce sparked an upheaval in the consumers buying behavior and also changed the ways in which businesses interact with each other. As the global e- commerce market is heating up, varying buying patterns and trends have been observed in different countries of the region with regards to the product category preferred for online purchase.

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Asia-Pacific dominated the Contract Logistics market in 2017, Asia-Pacific dominated the global contract logistics market with more than one-third of the market share surpassing Europe with China and Japan being the leading countries in this region. This growth in demand for contract logistics in this region is attributed to robust economic growth along with growing retail enactment owing to the rising disposable income. Moreover, foreign manufacturers select Asian countries as their production locations due to the availability of cheaper labor. The factors such as continual urbanization, strong economic growth, and growth in middle-class population supported the growth in domestic consumption of fast-moving consumer goods for everyday consumption, personal automobiles, household items, and luxury items is expected to drive the growth of the Contract Logistics market in the Rest of APAC countries during the forecast period.

Also, the presence of several manufacturing firms in the economies of the region is another significant factor fueling the growth of the market. The growth achievement in these emerging markets of Asia Pacific is comparatively easier than in developed nations. Strong manufacturing and retail sales growth together with a rising appetite for subcontracting is a far more promising environment than in developed economies. However, the major restraining factor faced by logistics players in these developing economies is to efficiently operate in a completely different logistics and supply chain environment. One of the prominent hindrances throughout the ASEAN region is inadequate supply chain infrastructure.

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Market Insights

Swift growth of manufacturing industry and their focus laid on core competencies

The global manufacturing industry has witnessed rapid growth in recent times owing to huge investments coming up from Governments of various countries and especially the developing economies. As per the China Federation of Logistics and Purchasing (CFLP), the global manufacturing purchasing managers index (PMI) accounted 55.1 in October 2017, which was down from 55.9 in September 2017 however, still at a comparatively high level. The PMI index remained above 53.5 since the beginning of 2017, signifying a strong recovery of the manufacturing sector in developed countries, increasing industrial advancement in emerging market economies and intensifying commodities prices on the global market. This expansion in the manufacturing industry is expected to embrace technological advancements to enhance plant productivity, maintain an edge with the customers and gain competitive advantage. Steady and consistent economic growth worldwide is a major driving factor for the development and advancements in the manufacturing industry. Further, the manufacturing industry is presently found to be in the middle of a technological renaissance, which is changing the outlook, systems, and processes of the modern factory.

Type-Based Market Insights

Based on type, the global contract logistics market is segmented into outsourcing and insourcing. Many companies that run small and medium scale businesses do not have the scale required or the complexity in their shipping operations for contracting logistics service providers. Moreover, maintaining a completely in-house shipping operation provides the companies with complete control over the shipping operations. These operations include negotiating carrier rates, planning and optimizing loads, and executing the distribution plans.

Service-Based Market Insights

Based on service, the contract logistics market is segmented into transportation, warehousing, packaging processes and solutions, distribution, production logistics, aftermarket logistics, and others. Contract logistics players provisioning transportation management services own core competencies in freight forwarding and also offer additional value-added services.

End User-Based Market Insights

On the basis of an end user, the global contract logistics market is categorized into aerospace, automotive, consumer, high-tech, industrial, pharma healthcare, retail, and others. In the era of cut-throat competition, companies offering products, solutions, and services have largely focused on their core competencies. As a result, whatever task is outside of the core competency of the firm, is outsourced. Further, the theory of core competency has resulted in the unprecedented growth of the services industry globally. Contract logistics services have emerged to be one of the fastest growing services in the services industry.

Company Profiles

  • Deutsche Post AG
  • XPO Logistics Inc.
  • Kuehne + Nagel International AG
  • CEVA Logistics AG
  • DB Schenker
  • Hitachi Transport System Ltd
  • Geodis
  • Neovia Logistics Services
  • UPS Supply Chain Solutions
  • Ryder System

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