While 2009 will be the first year since at least 1996 that the US third-party logistics (3PL) market will contract, 2010 could signal a fairly strong return to growth, according to a report, “Who’s Who in Logistics and Supply Chain Management”, by Armstrong & Associates, a US-based consultancy.
In the 13 years since the consultancy has kept records, the US 3PL market has grown from $30.8 billion in 1996 to $127 billion in 2008, increasing every year. This year Armstrong estimates that revenue will fall 7% to $118 billion. Next year, however, it estimates a rebound of nearly 6%, to $125 billion.
The report surveys the capabilities of more than 250 international 3PLs between two volumes covering both the Americas and the International market. Of those surveyed, 70% are private versus publicly-traded companies.
Earlier this year Armstrong reported that Q1 revenues for US 3PLs had declined about 6.7%, with automotive showing the steepest drop, at more than 37%. However, a list of the top 3PL providers in North America by revenue still show that of the top 20 3PL in 2008, only three do not include automotive as a major vertical (VersaCold Logistics Services,Werner Enterprises Dedicated & Logistics and NFI).
For the major automotive 3PLs, such as Ceva, Ryder, Panalpina and Penske Logistics, individual analysis of each company in the report reveals part of their strength to be in diversification. Ryder, it was noted, has been moving more aggressively into retail, consumer goods and high tech, with some success in 2007 and 2008. Meanwhile, Penske Logistics, according to the report, “has made significant strides in leveraging its automotive experience to other verticals.” This includes high tech and pharmaceuticals.
Top 20 North American 3PLS by 2008 Net Revenue
1) UPS Supply Chain Solutions ($6.2 billion)
2) DHL Exel Supply Chain ($4.6 billion)
3) Ceva Logistics (The Americas) ($2.8 billion)
4) Caterpillar Logistics Services ($2.3 billion)
5) DB Schenker Americas ($2.2 billion)
6) Ryder System ($1.8 billion)
7) Panalpina ($1.6 billion)
8) Expeditors Int’l of Washington ($1.3 billion)
9) UTi Worldwide ($1.5 billion)
10) CH Robinson Worldwide ($1.3 billion)
11) VersaCold Logistics Services ($1.2 billion)
12) Schneider Dedicated Operations ($1.2 billion)                                       
13) FedEx Supply Chain Services ($999m)
14) Penske Logistics ($954m)
15) JB Hunt ($927m)
16) Kuehne + Nagel (The Americas) ($844m)
17) Werner Enterprises ($826m)
18) NFI ($800m)
19) Swift Transportation ($800m)
20) Genco Supply Chain Solutions ($789m)
source: Armstrong Associates, www.3plogistics.com