Logistics Market By Mode of Transport (Roadways, Railways, Airways, Waterways), End-User (Healthcare, Manufacturing, Aerospace, Telecommunication, Banking & Financial Services), Model (Contract Logistics, Lead Logistics), & Region for 2024-2031

Logistics Market Valuation – 2024-2031

The evolving role of logistics within the supply chain focuses on the efficient movement of goods, services, and information from origin to end-user. The industry is shifting towards digitization and automation, streamlining operations and enhancing transparency across transportation modes. Thus, digitalization and automation, streamlining surge the growth of market size, surpassing USD 4.87 Billion in 2023 to reach a valuation of USD 6.52 Billion by 2031.

Technological advancements and the economic benefits of efficient resource management are driving the Logistics Market forward. The integration of digital tools, automation, and varied transportation methods is transforming logistics into a faster, more reliable, and scalable system, essential for meeting the demands of today’s global supply chain. Thus, the advanced technology and economic benefits enable the market to grow at a CAGR of 3.70% from 2024 to 2031.

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Logistics Market: Definition/ Overview

Logistics encompasses the strategic coordination and movement of resources, including people, materials, inventory, and equipment, from one location to another, ensuring efficient transfer to the desired location or storage. This complex process involves multiple stages, from purchasing and delivering raw materials to packaging, shipment, and transportation to end distributors. Key components within logistics include inbound and outbound transportation, fleet management, and warehousing, all of which are essential for the seamless flow of goods.

 Effective logistics management is crucial for business success, directly influencing operational efficiency and profitability. By streamlining the procurement, transportation, and storage of raw materials, businesses can reduce costs, improve productivity, and optimize resource use. Moreover, the timely delivery of products not only meets but often exceeds customer expectations, which enhances customer satisfaction and loyalty. This efficient logistics chain ultimately strengthens customer retention, positioning the business favorably in a competitive market. The importance of logistics extends beyond individual processes, serving as a backbone for smooth business operations and reinforcing the company’s overall service quality.

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How Does the E-commerce Growth and Adoption of Supply Chain Technology Surge the Growth of the Logistics Market?

 E-commerce involves the buying and selling of goods through the Internet, with third-party service providers handling the shipping of products to customers. Logistics services play a crucial role in the e-commerce sector by managing and overseeing the supply chains of e-commerce businesses. This enables these businesses to concentrate on other critical operations, such as marketing and customer engagement, while logistics providers ensure timely and efficient order fulfillment and delivery. Global e-commerce sales reached USD 5.2 Trillion in 2021, representing 19.6% of total retail sales (UNCTAD, 2022). During the pandemic, e-commerce penetration experienced the equivalent of 10 years of growth in just 3 months (McKinsey, 2020). The cross-border e-commerce Logistics Market was valued at USD 192.6 Billion in 2022 (World Economic Forum, 2023). By 2023, over 56% of the world’s population lived in urban areas (UN World Urbanization Prospects).

In addition, the adoption of supply chain management surged the growth of the Logistics Market. Global supply chain management software market reaching USD 15.9 Billion in 2021. IoT devices in the supply chain grew to 27.1 billion connected devices in 2021 (IoT Analytics). Sustainability Initiatives. 84% of logistics companies will implement sustainability programs by 2022. Carbon emissions from logistics activities account for 11% of global GHG emissions. Also, the increasing cross-border trade globally surges the growth of logistics. Global cross-border trade volume reached USD 22.1 Trillion in 2021 (WTO). RCEP (Regional Comprehensive Economic Partnership) agreement covers 30% of global GDP. International freight transport is expected to grow by 3.2% annually through 2050 (International Transport Forum).

How do the High Operating Costs & Infrastructure Limitations Impede the Growth of the Logistics Market?

The high operating costs and infrastructure limitations impede the growth of the Logistics Market. According to the American Transportation Research Institute, Transportation costs increased by 23% between 2020-2022. Fuel costs represented 35% of total operating costs in 2022, up from 24% in 2020. The infrastructure funding gap will reach USD 2.6 Trillion globally by 2021. The lack of skilled labor creates a challenge for the market to grow. According to the American Trucking Association, The logistics industry faced a shortage of 80,000 truck drivers in 2021. Warehouse worker turnover rates reached 43% in 2022. 54% of logistics companies reported difficulty finding skilled workers for technology roles (DHL Supply Chain Survey, 2022).

Regulatory compliance & documentation hamper the growth of the Logistics Market. Companies spend approximately 6.1% of annual revenue on compliance. Cross-border documentation errors caused USD 2.4 Billion in losses in 2021. 78% of logistics companies reported increased regulatory complexity between 2020-2022 (World Bank Logistics Performance Index). Logistics companies need to reduce carbon emissions by 45% by 2030 to meet Paris Agreement goals. Environmental compliance costs increased by 27% from 2020 to 2022. 67% of companies reported struggling with sustainable logistics implementation (EPA, 2022). Technology Integration & Cybersecurity Challenges. 61% of logistics companies experienced cybersecurity incidents in 2022. The average cost of a supply chain cyberattack reached $2.4 million in 2022. Legacy system integration issues cost the industry $157 billion annually.

Category-Wise Acumens

How does the Increasing Popularity of Transporting Retail Products Surge the Growth of the Roadways Segment?

The roadways segment plays a dominant in the Logistics Market, driven by growing demand for transporting retail products over long distances, especially within domestic markets. Retail businesses rely on trucks and cargo vehicles with high carrying capacities, offering a flexible and accessible mode of transport compared to others. Road transportation is ideal for door-to-door deliveries and accessing remote locations, providing a cost-effective solution for short- to medium-distance shipments, which appeals to many businesses.

An extensive road network in many regions connects major cities and industrial hubs, supporting the efficient movement of goods. The roadways segment also enables faster transit times, essential for time-sensitive deliveries. The rapid expansion of e-commerce and the rising need for last-mile delivery services have further increased demand for road transport. Additionally, roadways’ versatility allows for the transport of diverse goods, from perishable items to heavy machinery, making it a critical component in the supply chain industry.

How the Complexity of Raw Materials and Components Surge the Growth of Manufacturing Segment?

 The manufacturing segment dominates the Logistics Market during the forecast period, driven by the complexity of sourcing raw materials and components from numerous suppliers worldwide. In manufacturing, coordinating the flow of materials and products from diverse suppliers and distributing finished goods to multiple locations is a labor-intensive process. To manage this complexity efficiently, manufacturing companies are increasingly outsourcing logistics activities.

Outsourcing logistics offers significant advantages, including lower transportation costs, improved supply chain visibility, enhanced vendor management, and streamlined business processes. By delegating transportation tasks to specialized logistics providers, manufacturers can focus more on core operations while ensuring efficient delivery and optimal customer service.

This trend is particularly strong in industrialized regions such as the United States, Mexico, China, and India, where demand for manufacturing support through third-party logistics services is rising. These regions benefit from established supply chain infrastructure and high-volume production, making them ideal candidates for logistics outsourcing. Ultimately, the manufacturing sector’s reliance on comprehensive logistics solutions underscores its critical role in driving growth within the Logistics Market and meeting the demands of an interconnected global supply chain.

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Country/Region-wise Acumens

 How does the Advanced Technology Integration & Digital Transformation Surge the Growth of the Logistics Market in North America?

 North America substantially dominates the digital transformation and advanced technology surges the growth of the Logistics Market. 76% of North American warehouses planned to implement automation technologies by 2023. Warehouse robotics adoption increased by 196% between 2020-2022 in North America (Association for Advancing Automation). AI and machine learning implementation in logistics grew by 89% during 2021-2022 in the region. In addition, the e-commerce growth and last-mile innovation foster the growth of the market in the region. U.S. e-commerce sales reached USD 1.03 Trillion in 2022, growing 39% faster than pre-pandemic predictions (U.S. Census Bureau). Same-day delivery services in North America grew by 51% in 2022. 72% of North American retailers will adopt omnichannel logistics strategies by 2022. Last-mile delivery market in North America was valued at USD 108.1 Billion in 2022.

U.S. Infrastructure Investment and Jobs Act allocated USD 110 Billion for roads and bridges. The Canadian government committed CAD 1.9 Billion to the National Trade Corridors Fund. Port infrastructure investments reached USD 9.5 Billion across major North American ports in 2022. Smart transportation initiatives received USD 4.2 Billion in federal funding during 2021-2022.

How does the Rapid E-commerce Growth & Digital Adoption Surge the Growth of the Logistics Market in Asia Pacific?

 Asia Pacific is anticipated to witness the fastest growth in the Asia Pacific e-commerce market reaching USD 2.99 Trillion in 2022, representing 52.6% of global e-commerce sales. China’s online retail sales grew to USD 2.1 Trillion in 2022, accounting for 44.8% of global e-commerce. Southeast Asian e-commerce grew by 63% between 2020-2022, reaching USD 174 Billion. Mobile commerce in APAC represented 76% of all e-commerce transactions in 2022. Government Infrastructure Initiatives & Investment. China’s Belt and Road Initiative invested USD 59.5 Billion in infrastructure projects during 2020-2022. India allocated USD 1.4 Trillion for infrastructure development under the National Infrastructure Pipeline.

ASEAN countries committed USD 184 Billion to infrastructure projects in 2022. Japan’s infrastructure investment reached ¥30.5 trillion (USD 276 Billion) in 2022 under the Digital New Deal. APAC manufacturing output accounted for 48.5% of global manufacturing value in 2022 (UNIDO). Vietnam’s manufacturing sector grew by 12.8% in 2022, attracting USD 15.4 Billion in FDI. India’s manufacturing sector expansion reached 10.5% in 2022. RCEP trade agreement covering 15 Asia-Pacific nations represented 30% of global GDP in 2022, facilitating regional trade worth USD 2.3 Trillion.

Competitive Landscape

The Logistics Market is a highly competitive industry, with a diverse range of players, from global giants to regional specialists. The competitive landscape is constantly evolving, driven by technological advancements, globalization, and changing consumer expectations.

The organizations are focusing on innovating their product line to serve the vast population in diverse regions. Some of the prominent players operating in the Logistics Market include United Parcel Service, Inc.,Nippon Express,Kuehne+Nagel,Geodis,FedEx,DSV,Deutsche Post AG,DB Schenker,H. Robinson Worldwide, Inc.,P. Moller-Maersk.

Latest Developments

• In May 2022, Midair Aviation IFSC PVT LTD, a major player in the logistics industry, announced the launch of a cutting-edge courier platform. The objective was to focus on densely populated areas.
• In April 2020, Small and medium-sized firms can now sell products online and connect to commerce and delivery through an alliance between edEx and BigCommerce Pty. Ltd., an open-source SaaS e-commerce platform provider. BigCommerce Pty. Ltd. is grateful for this relationship.
• In January 2020, H. Robinson invested USD 225 Million in Prime Distribution Services. The acquisition provides the corporation with retail consolidation. Services such as distribution and fulfillment and inventory control.

Report Scope

Logistics Market, By Category

Mode of Transport:

• Roadways
• Railways
• Airways
• Waterways

End-User:

• Healthcare
• Manufacturing
• Aerospace
• Telecommunication
• Banking & Financial Services

Model:

• Contract Logistics
• Lead Logistics

Geography:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

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