Global 3PL (Third Party Logistics) Market size will reach over $1 trillion by 2026

The Global 3PL (Third Party Logistics) Market is expected to increase to a value of $1 trillion by 2026, at a growing CAGR of 8%.

What is 3PL (Third Party Logistics)?

3PL or Third- party logistics in logistics management is an organisation’s use of third- party industries to outsource elements of its distribution, warehousing, and fulfilment services.

It is the function by which a producer outsources activities related to logistics and distribution. A 3PL organization can offer particular types of assistance, like, stock management, cross-docking, house to house conveyance, and packaging of items. The market for 3PL assistance is likely to observe critical development, because of improvement of the internet business industry. Additionally, the interest for this assistance is anticipated to heighten soon, because of expansion in focus of producers and retailers on their core business, and subcontracting activities, for example, logistics where they have less ability. In this way, expansion in contest has conveyed the focal point of makers to advance individual specialization in production and distribution.

Market overview

The quick development of internet business is driving the interest for 3PL administrations universally. The tenacious development of web-based business is in a general sense changing the third-party (3PL) scene. With the expanding buyer assumptions for on schedule and precise deliveries, and to remain cutthroat, more web-based business retailers are re-appropriating crucial parts of their dissemination and satisfaction tasks to 3PL accomplices.

Numerous web-based business retailers are small in size and can't bear to have in-house logistics services. Accordingly, services like supply chain management, warehousing, alliance service, and request execution are outsourced to 3PL organizations. Though, significant internet business retailers, like Amazon and Alibaba are fostering their own logistics infrastructure.

For the meantime, the development of internet business and change in customer assumptions are additionally introducing difficulties to the 3PL organizations as far as lessening the parcel delivery items, expanding proficiency, embracing the most recent and trend setting technologies, and so on. A colossal change is occurring in last-mile delivery, with organizations observing for substitutions, like delivery lockers, pickup points, crowdsourced deliveries, drone deliveries, and independent vehicles. The progress of technologies is reforming the entire supply chain and rethinking the parcel business. Technology is turning into a significant empowering influence in expanding effectiveness and arriving at customer assumptions.

Economic growth

The Global 3PL (Third Party Logistics) Market size was $1,027.71 billion in 2019, $838.9 billion in 2020, and is expected to increase to a value of $1 trillion by 2026, at a growing CAGR of 8%.

In 2019, Asia- Pacific, gathered the maximum share in the global 3PL market.

Based on means of transport, airways play the main role to increase the economic growth. 

Market segment analysis

The Global 3PL (Third Party Logistics) market is segmented on the basis by Type, Transport Type, Application, and geography.

By type- DTM (domestic transportation management), ITM (international Transportation Management), DCC (dedicated Contract Carriage), W&D (Warehousing and Distribution), and VALs

DCC (Dedicated Contract Carriage), is expected as the most profitable segment, which drive the market.

By transportation Type- Roadways, Railways, Waterways, and Airways

In this segmentation, railways are anticipated to develop the immense growth in the market.

By Application- Manufacturing, Retail, Healthcare, Food and Groceries and Automotive.

From all the segmentation, Food and Groceries is the most driving factor in the 3PL market

By Geographic Region- North America, Asia- Pacific, Europe, and LAMEA

The biggest offer in the market will be dominated by United States which is assessed at $222.1 billion in 2021. Among the other critical geographic business sectors are Japan and Canada, each estimate to develop at 5.5% and 6.2% individually. Inside Europe, Germany is assessed to develop at around 6% CAGR while Rest of European market will arrive at US$358.9 Billion.

Key players in the 3PL (Third Party Logistics) market are:

• Agility
• Ceva logistics
• DB Schenker Logistics
• Kerry Logistics
• CH Robinson