Contract Logistics Market in APAC Size to grow by USD 53.9 billion between 2024-2028
According to a research report “ Contract Logistics Market in APAC” by Application (Retail, Pharmaceutical, Automotive, Others) Type (Outsourcing, Insourcing) Geography (APAC)- Global Forecast to 2028 published by Technavio, the market size is estimated to grow by USD 53.9 billion, at a CAGR of 8.08% during the forecast period. The e-commerce sector's continued growth in APAC, with sales increasing by 6.6% in Q3 2021 compared to the same period in 2020, according to the US Census Bureau, is driving the demand for contract logistics services. Contract logistics providers are responding by investing in advanced technologies and integrating them into their offerings to enhance their capabilities and better serve clients. The emergence of e-fulfillment services like Amazon's and the resulting shift in consumer behavior towards online shopping have significantly influenced logistics vendors' business strategies. In Q3 2021, e-commerce sales accounted for 13% of total retail sales, highlighting the market's potential for contract logistics providers..
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By Application, the Retail segment is projected to dominate the market size in 2024
The retail segment, comprising consumer goods, clothing and accessories, pharmacies and drugs, food and beverage stores, electronics and appliances, and furniture, experiences significant growth in the APAC Contract Logistics Market. This expansion is primarily attributed to the burgeoning e-commerce industry, which necessitates the use of various transportation modes, such as rail, air, water, and roadways, for moving goods. Furthermore, increased government investment in logistics infrastructure and the proliferation of digital sales channels, driven by the adoption of multiple payment facilities like mobile wallets and net banking, are key catalysts fueling the segment's growth during the forecast period.
By Type, Outsourcing segment is expected to hold the largest market size for the year 2024
In the dynamic business landscape of APAC, outsourcing logistics functions to third-party logistics (3PL) providers has become a strategic choice for companies seeking to optimize their supply chain operations. By engaging 3PL providers, businesses can leverage specialized expertise in areas such as warehousing, transportation, freight forwarding, and value-added services (VAS), including inventory management, cross-docking, kitting and assembling, door-to-door delivery, and product packaging. These providers not only streamline logistical processes but also offer operational and strategic value to shippers worldwide. In the competitive APAC market, 3PL providers are continually innovating and implementing advanced supply chain management techniques to enhance efficiency and effectiveness.
APAC is forecasted to hold the largest market size by region in 2024
The Contract Logistics Market in APAC is experiencing significant growth due to increasing e-commerce sales and the rising trend of outsourcing logistics operations. Key players in this market include DHL, DB Schenker, and Kuehne + Nagel, who provide services such as warehousing, transportation, and fulfillment to clients. The region's robust economic growth and expanding trade networks are driving demand for efficient and cost-effective logistics solutions. Companies are investing in advanced technologies like automation and data analytics to enhance their offerings and meet the evolving needs of customers.
The Contract Logistics Market in APAC growth and forecasting report also includes detailed analyses of the competitive landscape of the market growth and forecasting and information about 20 market companies, including:
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Research Analysis Overview
The Contract Logistics Market in APAC is experiencing significant changes due to various macroeconomic factors and industry trends. With inflation levels on the rise and the aftermath of macroeconomic upheavals, logistics providers are implementing rate hikes to mitigate costs. The region's economic powerhouses, such as China (CNY) and the ASEAN countries, are driving growth in industries like electronics, automotive, and consumer retail, leading to increased customer demand and the need for robust distribution channels. The logistics industry in APAC is also embracing Industry 4.0, with companies like Deutsche Post DHL, Alibaba Holding, and Cainiao Network investing in AI, machine learning, cloud computing, and automation to streamline operations and improve efficiency. The Post E-commerce Express Delivery Coalition's Road Initiative is further accelerating e-commerce growth, while the RCEP Agreement is expected to create a single market, boosting trade and logistics opportunities. Intel, Motor Vehicles, and manufacturing hubs in emerging markets are also key players, contributing to the region's GDP growth and manufacturing output. The Belt and Road Initiative is also expected to enhance connectivity and logistics infrastructure across APAC.
Market Research Overview
The Contract Logistics Market in APAC is experiencing continuous evolution, driven by the surge in ecommerce transaction volumes and the convenience that digital consumers demand. According to Boston Consulting Group, GMV (Gross Merchandise Value) in the APAC ecommerce market is projected to reach USD2.2 trillion by 2025, leading to increased spending on logistics services. Spatial requirements for warehousing and distribution are a key concern for businesses, with structural undersupply leading to rent growth and competition for quality assets. Fuel costs, manpower resources, and spatial inventory are major challenges for logistics operators. However, the sector's strong fundamentals, including revenue growth, real income levels, and positive consumer sentiments, are driving investment in iLogistics assets. The logistics sector is also being impacted by macroeconomic upheavals such as energy prices, rate hikes, inflation levels, and climate disasters. Key players in the market include Ninja Van, Coupa Software, Capgemini Research, and Deutsche Post E-commerce. Sectors such as electronics, medicine, automotive, and consumer retail are experiencing high customer demand, requiring efficient distribution channels. The logistics sector is also adapting to Industry 4.0 trends, including machine learning, cloud computing, and AI, to optimize manufacturing output and create manufacturing hubs in emerging markets. The RCEP Agreement, CNY, and the ASEAN market are also significant factors influencing the market's growth. Alibaba Group Holding, Cainiao Network, Intel, and Motor Vehicles are major players in the region. The logistics sector is expected to remain a key driver of economic growth in APAC, despite challenges from lockdown periods and ecommerce competition.
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