Contract Logistics Market APAC 2024-2028 to Witness Significant Growth Amid E-commerce Boom

The APAC contract logistics market is set to expand by USD 53.9 billion at a CAGR of 8.08% between 2023 and 2028. The rise of digital consumers and the rapid expansion of e-commerce are driving demand for logistics providers that can efficiently manage inventory, manpower, and warehouse space. The increasing reliance on logistics outsourcing and third-party providers is reshaping distribution networks, enabling businesses to enhance inventory management and optimize freight services. The adoption of automation tools is improving vendor performance, driving efficiency in retail logistics, and enhancing operational efficiency. Additionally, companies are investing in fulfillment solutions to meet growing e-commerce demand. However, the industry faces challenges such as competition, rent growth, and a shortage of quality logistics assets. Despite these constraints, occupiers continue to invest in logistics real estate to secure their supply chains. With Industry 4.0 technologies, AI, cloud computing, and machine learning transforming operations, the market remains poised for steady growth, especially within the automotive, retail, and pharmaceutical sectors.

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Market Segmentation

The market is segmented based on application and type.

By Application:

• Retail
• Pharmaceutical
• Automotive
• Others

By Type:

• Outsourcing

• Insourcing

By Application Insights

The retail segment is anticipated to experience significant growth during the forecast period. In APAC, e-commerce retail is booming, leading to increased demand for seamless and efficient delivery solutions. The segment includes a wide range of products such as consumer goods, clothing, electronics, furniture, food & beverages, and pharmaceuticals. To meet growing demand, logistics companies are investing in multi-modal transportation solutions, including rail, air, water, and road networks.

Government investments in logistics infrastructure and the expansion of digital sales channels—such as mobile wallets and online banking—are further fueling retail growth. The retail contract logistics market in APAC was valued at USD 30.40 billion in 2018 and has shown steady expansion over the years.

Regional Market Trends

The APAC contract logistics market is expanding due to robust GDP growth and the establishment of manufacturing hubs in emerging economies. These hubs, particularly in the motor vehicles, electronics, and consumer retail sectors, are driving demand for advanced logistics solutions. AI, cloud computing, and machine learning are enabling real-time tracking, predictive maintenance, and optimized distribution channels.

Market Dynamics

Drivers:

• Growth in the e-commerce market: The rising popularity of e-commerce is fueling demand for efficient and reliable logistics services. As consumer behavior shifts toward digital retail, logistics providers are leveraging AI, cloud computing, and machine learning to optimize inventory management and improve supply chain visibility.
• Establishment of manufacturing hubs: Countries like China, India, and Vietnam are emerging as global manufacturing hubs, boosting the demand for contract logistics services. The Belt and Road Initiative has further positioned APAC as a key region for logistics expansion.

Trends:

• Emergence of big data analytics: Logistics firms are integrating big data analytics to enhance service customization, operational efficiency, and geographic expansion. However, IT disparities continue to slow the full-scale adoption of big data solutions in APAC logistics.
• Adoption of AI and machine learning: AI-powered logistics solutions are gaining traction, particularly in motor vehicle manufacturing hubs across China and India. The region’s strong GDP growth and rising manufacturing output make it an attractive market for contract logistics investments.

Challenges:

• Increased lead times and supply-demand imbalance: The pandemic disrupted supply chains, causing logistics delays, workforce shortages, and raw material constraints. Many APAC countries have experienced extended lead times due to fluctuating regulations, last-mile delivery inefficiencies, and imbalanced freight movement.

Market Research Overview

The contract logistics market is evolving with rapid advancements in third-party logistics, warehousing, and transportation. As demand for freight forwarding, distribution, and inventory management grows, businesses are increasingly turning to outsourcing logistics to enhance efficiency. The rise of e-commerce logistics is further driving investments in logistics solutions, particularly in fulfillment services and last-mile delivery. Cold chain logistics and reverse logistics are also gaining prominence as companies focus on supply chain resilience.

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Key Players

The APAC contract logistics market features major players specializing in transportation, warehousing, and supply chain management. Key companies include:

• CEVA Logistics
• BCR Australia Pty Ltd.
• C H Robinson Worldwide Inc.
• CJ Logistics Corp.
• DB Schenker
• Deutsche Post AG
• DSV AS
• GEODIS
• Gulf Agency Co. Ltd.
• Hellmann Worldwide Logistics SE and Co KG
• Hitachi Transport System Ltd.
• Kuehne Nagel Management AG
• Lexzau Scharbau GmbH and Co. KG
• PT. Cipta Mapan Logistik
• Rhenus SE and Co. KG
• SF Express Co. Ltd.
• Silk Contract Logistics Pty Ltd.
• Toll Holdings Ltd.
• United Parcel Service Inc.
• Yamato Holdings Co. Ltd.

Research Analysis Overview

Technological advancements in automation logistics, logistics contracts, and vendor management are reshaping the industry. AI-powered logistics technology is improving operational efficiency, while blockchain solutions are enhancing transparency in logistics contracts. The expansion of logistics providers in APAC is being driven by the demand for fast, cost-effective distribution networks. With increasing investments in transportation infrastructure, warehousing automation, and supply chain optimization, the contract logistics market is set for sustained growth.