South East Asia Third Party Logistics market is expected to grow from US$ 36.4 Bn in 2017 to US$ 55.7 Bn by 2025 at a CAGR of 5.5% between 2018 and 2025.
Pune, India -- (SBWIRE) -- 03/25/2019 --
The third party logistics experiencing a steady growth with regards to the research and development activities, product innovations, investments, and technological integrations, and deployment in the current scenario and is anticipated to rise exponentially in the coming years. The market for third party logistics consists of some well-established players across the globe that caters varied diversified industries. The countries of South East Asia is experiencing a high growth in the third party logistics market and this region is expected to continue its lead during the forecast period. Where, Indonesia holds a highest market share followed by Thailand and Vietnam. The South East Asia region is contributing to the highest revenue due to robust economic growth along with growing retail enactment owing to the rising disposable income in this region. Further, fast growth in e-commerce sector and rise in foreign direct investment are boosting the market for third party logistics in this region. The selection criteria of mode of transport is depends on the physical characteristics of goods and supplies. In certain situations, environmental factors such as destruction of roads and railways may have a considerable impact on the mode of selection. The factors considered in mode of selection would be speed which the mode exhibits, flexibility that the mode offers, and comparative unit cost.
The major companies offering third party logistics to different industries include Deutsche Post AG, Nippon Express Co., Ltd., C.H. Robinson Worldwide, Inc., Kuehne + Nagel International AG, XPO Logistics, Inc., DB Schenker, DSV A/S, Geodis, Sinotrans Co., Ltd., and UPS Supply Chain Solutions among others. Several other companies are also offering these services to different industries which is facilitating the third party logistics market to propel over the years.
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Currently, roadways are the leading mode of transport segment, whereas airways are expected to grow at a higher rate during the forecast period. Airways is often considered as an alternative for other mode of transport especially in case of flooding and conflict situations. The factors that influence the selection for airway mode of transport are availability & cost of different types of aircraft, the distance to be travelled & possible constraints on certain airspace, and securing landing & over-flight permission. The solutions deployed for third party logistics have graduated from being highly expensive to inexpensive solutions over the years.
The South East Asia market for third party logistics is segmented on various parameters such as mode of transport, services, end-user, and geography. Based on mode of transportation, roadways segment dominates the entire third party logistics market and is expected to continue its dominance throughout the forecast period from 2018 - 2025. On the basis of services, other services including freight forwarding, customs brokerage, distribution, and value-added services is expected to witness a significant increase in market share in the coming years, however, warehousing services is projected to be the fastest growing segment. Third party logistics market operates in an extremely fragmented industry with huge number of smaller players capturing the market.
South East Asia experiences a high demand in the third-party logistics market which is contributing highest revenue due to the presence of a large number of players and industry verticals. Indonesia and Thailand are contributing towards a high share in third-party logistics market. Moreover, Vietnam is projected to be the fastest growing region in the third party logistics market. The South East Asian countries continue to be more competitive and consumer-focused which would result into increase in the expectations for better third-party logistics. The logistics services hold a crucial position in the entire supply chain, beginning from procurement of raw materials to last mile delivery to returns & replacement service, the companies rely completely upon third party logistics service providers for attainment of its financial goals, customer delivery commitments and securing its profit margins. Also, other factors such as continual urbanization, strong economic growth, the rise in industrialization, 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. This, in turn, increases the retail sales and makes South East Asia a growing market for third-party logistics service consumer.
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