volatile...transportation market. since then, through its leading third-party logistics (3pl) market...

Phone: +1-800-525-3915 Website: www.3PLogistics.com Email: [email protected]

August 2020

VOLATILE:Latest Third-Party Logistics Market Results and Predictions for 2020 Including Estimates for 190 Countries

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ABOUT ARMSTRONG & ASSOCIATES, INC.Armstrong & Associates, Inc. (A&A) was established in 1980 to meet the needs of a newly deregulated domestic transportation market. Since then, through its leading Third-Party Logistics (3PL) market research and history of helping companies outsource logistics functions, A&A has become an internationally recognized key resource for 3PL market information and consulting.

A&A’s mission is to have leading proprietary supply chain knowledge and market research not available anywhere else. As proof of our continued work in supporting our mission, A&A’s 3PL market research is frequently cited in media articles, publications, and securities filings by publicly traded 3PLs. In addition, A&A’s email newsletter currently has over 88,000 subscribers globally.

A&A’s market research complements its consulting activities by providing continually updated data for analysis. Based upon its unsurpassed knowledge of the 3PL market and the operations of leading 3PLs, A&A has provided strategic planning consulting services to over 30 3PLs, supported 21 closed investment transactions, and provided advice to numerous companies looking to benchmark existing 3PL operations or outsource logistics functions.

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U.S. 3PL MARKET


Longer-Term Contracts Win in a Mixed 2019, 2020 Faces Coronavirus Volatility and Economic Headwinds

4

U.S. 3PL MARKET


Figure 1. U.S. 3PL Market 2005 - 2020E (US$ Billions)

Dedicated Contract Carriage (DCC)Within the asset‐heavy Dedicated Contract Carriage (DCC) 3PL market segment, gross revenue was off 3% for the first half of 2020 versus the first half of 2019 and net revenue saw a slight decline. DCC segment shipment volumes declined, but the overall impact was lessened due to the longer-term nature of its customer agreements. We anticipate the COVID-19 economic volatility in domestic transportation and increases in domestic transportation demand to positivity impact DCC growth for the remainder of the year as shippers look for a safe haven for capacity and as DCC providers continue to benefit from contracts negotiated prior to the pandemic.

In 2018, the tight domestic motor carrier market led to 15.8% net revenue growth in DCC which continued into 2019 driving 12.1% net revenue growth for a total of $19.9 billion in 2019 DCC segment net revenues. DCC’s overall segment growth came even as many domestic truckload carriers, including large truckload carrier Celadon, sought bankruptcy protection. Most DCC contracts have one‐ to three-year terms with dedicated asset requirements. This makes them much “stickier” than standard shipper/carrier trucking contracts and were a strong contributor to the segment’s continued strong performance in 2019.

$104.2$113.6

$119.0$127.0

$107.1

$127.5$135.5

$142.0$147.0

$157.8 $161.2$166.8

$184.3

$213.5 $212.8$208.0

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20052006

20072008

20092010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020E

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U.S. 3PL MARKET


Table 1. U.S. 3PL Market Growth by Segment

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U.S. 3PL MARKET


Table 2. Top 50 DCC 3PLs by 2019 Power Units*

Value-Added Warehousing and Distribution (VAWD)

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U.S. 3PL MARKET


Domestic Transportation Management (DTM)

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U.S. 3PL MARKET


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U.S. 3PL MARKET


International Transportation Management (ITM)

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U.S. 3PL MARKET


Figure 2. U.S. 3PL Market Segment Net Revenues and CAGRs 2005 - 2020E*

Table 3. U.S. 3PL Segment Growth Predictions for 2020

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U.S. 3PL MARKET


Top U.S. Based 3PLs

Table 4. Top 50 U.S. Based 3PLs by Gross Revenue

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U.S. 3PL MARKET


U.S. E-Commerce Logistics Costs, 3PL E-Commerce Revenues, and Amazon’s Current Market Share

Figure 3. U.S. E-Commerce Logistics Costs 2017 - 2020E (US$ Billions)

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U.S. 3PL MARKET


Figure 4. U.S. 3PL E-Commerce Revenues 2017 - 2020E (US$ Billions)

Figure 5. Amazon’s U.S. E-Commerce 3PL Market Revenue (US$ Billions)

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U.S. E-COMMERCE MARKET


Figure 6. Amazon’s Market Share of the Overall U.S. E-Commerce 3PL Market Segment

Merger & Acquisition Activity

Figure 7. 3PL Acquisitions over $100 Million (1999 - 2019)

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U.S. E-COMMERCE MARKET


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MERGERS & ACQUISITIONS


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MERGERS & ACQUISITIONS


Figure 8. GlobalTranz Ownership and Acquisition Timeline

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GLOBAL COSTS AND REVENUE


Global Logistcs Costs and Third-Party Logistics Revenues

Table 5. 2019-2020E Global Logistics Market and 3PL Segment Revenues by Country/Region (US$ Billions)

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GLOBAL COSTS AND REVENUE


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TOP 50 GLOBAL 3PLS


Top 50 Global 3PLs

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TOP 50 GLOBAL 3PLS


Table 6. Top 50 Global 3PLs by Gross Revenue

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TOP 50 GLOBAL 3PLS


Figure 9. Number of Top 50 Global 3PLs by Country

Market Research New Releases from Armstrong & Associates, Inc.

Expert Information Service (E.I.S.) Our premium market research and analysis offering includes access to our most popular 3PL market research reports and a subscription to our leading 3PL guide, Who’s Who in Logistics Online. Discounted phone consulting is available.

Amazon Logistics – Market Estimates,

Benchmarking, and Predictions

This comprehensive report analyzes e-commerce logistics, its major logistics competitors and Amazon’s impact on transportation and warehouse management, and the overall 3PL markets. Benchmarks for capital expenditures, warehousing and fulfillment, air freight, vehicles and drivers, and 3PL services and related assets are provided.

Digitization – The Convergence of Modern Freight Brokerage, Digital

Freight Matching, and Automation in Domestic Transportation

Management

Reports are available for purchase at http://www.3plogistics.com

Since our first report on Digital Freight Matching (DFM) in 2016 where we dubbed the term “Digital Freight Matching”, there has been increasing focus on these companies which have been seen by investors as market disruptors. This report details the convergence of DFM, modern Domestic Transportation Managers, and Digital Freight Brokers. It provides insights into what systems drive a 3PL’s classification as a DFB and what systems can be deployed to augment a TMS and digitalize a DTM/Freight Brokerage operation.

TRENDS IN 3PL / CUSTOMER RELATIONSHIPS

November 2016

Phone: +1-800-525-3915 Website: www.3plogistics.com Email: [email protected]

INCREASINGLY STRATEGIC: TRENDS IN 3PL / CUSTOMER RELATIONSHIPS

May 2020

Increasingly Strategic – Trends in 3PL / Customer

Relationships

This definitive analysis is an expanded update of Armstrong & Associates’ best-selling report. From its analysis of over 7,700 current 3PL customer relationships in 44 countries, totaling nearly 21,000 services, the report identifies and details key trends in outsourced third-party logistics provider (3PL) customer relationships. Armstrong & Associates has been tracking and analyzing 3PL/Customer relationships for over a decade with ever-increasing detail.

volatile...transportation market. since then, through its leading third-party logistics (3pl) market...

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