Global 3PL Market: Overview
Third party logistics, also known as 3PL, is an outsourcing
system wherein storage and transportation services are outsourced to a
specialist company. Outsourcing these services allows companies to cut costs
and focus on their core competency. Inventory management, delivery, packaging,
and cross-docking services are now usually bundled with 3PL services, making
the 3PL platform even more cost-effective. The global 3PL market is driven
primarily by the rising preference to outsource all non-essential tasks in the
corporate sector. This boosts the profit margin of the vendor significantly and
the trend is expected to remain influential in the forecast period.
The global 3PL
market is also driven by the increasing demand from the ecommerce sector
thanks to the latter’s steady growth in recent years. This is another major
driver for the global 3PL market, particularly in developing countries, where
the ecommerce sector stands to grow handsomely in the coming years.
The report presents a detailed profile of the global 3PL market,
including a review of the market’s historical trajectory and the key factors
influencing its growth at present. The current market figures are given in
detail in the report and are used to project the global 3PL market’s future.
The major segments of the global 3PL market are examined in the report to get
an idea of the hierarchy of the market by each criterion. The competitive
landscape of the market is also examined in the report.
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Global 3PL Market: Drivers and Restraints
Apart from the increasing preference to cut costs on
non-essential functionalities, the global 3PL market is majorly driven by the
fall in shipping rates, which have allowed 3PL operators to make a profit even
while allowing their clients to cut their own total expenditure. Utilizing 3PL
results in a smoother, more streamlined supply chain, making the process of
marketing and selling the products much easier
The rise of the ecommerce sector has been a major driver for the
global 3PL market in the last few years. Ecommerce giants focus on selling the
products through an online platform, and not all have their own logistics
services. Startups, which are becoming increasingly numerous in today’s
business environment, may not be able to afford their own logistics services,
necessitating the use of third party logistics.
The convenience of shopping online has resulted in consumers
unanimously showing their support to the expansion of ecommerce. This will
remain a major driver for the global 3PL market, as developing economies are
expected to witness a steady expansion of their ecommerce sectors in the coming
years, leading to an increase in the demand for 3PL services.
Global 3PL Market: Regional Analysis
The global 3PL market was led by Asia Pacific in 2015. A
trifecta of increasing disposable incomes, increasing availability of the
Internet, and escalating investments by ecommerce players has seen the
ecommerce sector grow by leaps and bounds in emerging countries such as China
and India. This is expected to remain influential for the global 3PL market in
the coming years.
Europe and North America accounted for the next largest shares
in the global 3PL market. The recent eurozone crisis has held the Europe 3PL
market back, but the increasing demand from the automotive industry is likely
to turn the tide in the years ahead. Latin America is expected to become
another key market for 3PL service providers in the near future due to the
increasing demand for ecommerce in the region.
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