U.S. based 3PL industry breaks $100 billion in revenue in 2007
By SwizStick • May 7th, 2008 • Category: 3PLI guess it’s a good time to be working in the 3PL industry:
And despite these challenging market conditions US 3PL revenues cracked the $100 billion mark at $103.7 billion in 2005, and hit $113.6 billion in 2006. Last year’s $122 billion represents a 7.2 percent uptick from 2006.
As in its past reports, Armstrong divides 3PL market segments into four categories: domestic transportation management, international transportation management, dedicated contract carriage, and value-added warehouse/distribution (VAWD).
International transportation management paced these categories with the highest year-over-year net revenue growth at 9.5 percent and $17.0 billion, followed by domestic transportation management at 8.0 percent and $6.0 billion, VAWD at 7.7 percent and $22.5 billion, and dedicated contract carriage at 2.7 percent and $11.5 billion.
The report added that 3PL revenue growth was highest in non-asset transportation management, and it also noted that overall industry growth continued a pattern of being more than three times the growth of the US gross domestic product.
Armstrong & Associates President Richard Armstrong told LM in an interview there are multiple reasons for the continued growth of 3PLs, even during this difficult domestic economic climate.
“[Shippers] continue to outsource logistics activities and depend more on 3PLs to provide them with a wide scope of services, and the increased potential for these services has also increased over time,” said Armstrong. “These services are very complete across broad geographical areas and can be maintained [by 3PLs].”
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