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The pharmaceutical warehousing market is estimated to grow at a CAGR of 4.9% between 2022 and 2027. The size of the market is forecast to increase by USD 15,751.86 million. The growth of the market depends on several factors, including a rise in demand for outsourcing pharmaceutical warehousing services, increased focus on quality and product sensitivity in the pharma industry, and automation at warehouses to increase efficiency and accuracy.
This report extensively covers market segmentation by application (pharmaceutical factory, pharmacy, and hospital), service (non-cold chain warehousing and cold chain warehousing), and geography (North America, APAC, Europe, South America, Middle East, and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rise in demand for outsourcing pharmaceutical warehousing services is notably driving the market growth, although factors such as the lack of efficient logistics support in emerging economies may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Pharmaceutical Warehousing Market Driver
The rise in demand for outsourcing pharmaceutical warehousing services is notably driving market growth. The growing demand for outsourcing warehousing services for pharmaceutical products is one of the major drivers in the global pharmaceutical warehousing market. Pharmaceutical manufacturing companies across the world are expanding their production capacities and operations. As a result, there is an increase in the need for logistics among retailers and distributors for storing raw materials and finished goods. Outsourced services reduce the logistics cost by 11%, the inventory costs by 6%, and the logistics fixed asset costs by 23%.
The increase in the supply chain management complexity for pharmaceutical companies has resulted in manufacturers outsourcing part of their SCM functions to warehouse and storage service providers. One of the services in demand is high-pressure processing post-packaging and non-thermal pasteurization methods for killing micro-organisms. This process enables companies to transport pharma products safely. The demand for efficiency, visibility, and product safety from pharmaceutical companies is driving cold chain 3PLs to add a wide range of value-added services. These factors will drive the demand for outsourcing pharmaceutical warehousing during the forecast period.
Key Pharmaceutical Warehousing Market Trend
Increased provision of end-to-end integrated services is the primary trend driving the pharmaceutical warehousing market growth. Several cold chain service providers have now started offering end-to-end integrated services to end-users in the market. They are providing cold chain management services to customers and participating in their decision-making processes. Many service providers offer end-to-end cold chain management services like inventory management, order scheduling, order forecasting, warehousing, and delivery management.
Disaster recovery services that enable customers to track consignments and help them communicate with the entire supply chain are also offered by vendors. In addition, some vendors provide training sessions for all the personnel involved in the cold chain logistics network. Thus, the increase in the provision of end-to-end integrated services by vendors is a key trend that is expected to have a positive impact on the market during the forecast period.
Key Pharmaceutical Warehousing Market Challenge
Lack of efficient logistics support in emerging economies is the major challenge impeding the pharmaceutical warehousing market growth. An efficient logistics support system can reduce the chances of product recalls and wastage of pharmaceutical products, which results from drawbacks in the cold chain logistics for pharmaceutical products. However, many pharmaceutical companies receive only minimal logistics support.
Cold chain logistics begins with transferring pharmaceutical products from the manufacturer to the end-user and involves continuous point-to-point handling of these goods between the different intermediaries. It also involves inter-state and inter-region transit of pharmaceutical items or products. Vendors in this market are therefore obliged to comply with stringent government regulations present in the regions of transit. Any anomaly in the cold chain process could result in the cold chain logistics process becoming ineffective, leading to the wastage of pharmaceutical products. Hence, the lack of efficient logistics support is proving to be a hindrance to the market's growth.
Key Pharmaceutical Warehousing Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Pharmaceutical Warehousing Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Deutsche Post AG - The company operates under multiple segments including Express, Global Forwarding, Freight, Supply Chain, eCommerce Solutions, etc. with a high focus on the Express segment. The company offers pharmaceutical warehousing such as life sciences products warehousing.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth of the pharmaceutical factory segment will be significant during the forecast period. Pharmaceutical warehouses are located in provinces and provide products to pharmacies as soon as they are needed. Additionally, these organizations that send medicines to medical facilities continue to grow in the pharmaceutical field. Pharmaceutical warehouses store or stock numerous products such as tablets, syrups, vaccines, medical devices, OTC products, diagnostic products, and diet products. This segment held the largest market share in 2022, and it is expected to continue to increase its market share during the forecast period.
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The pharmaceutical factory segment was valued at USD 21,985.94 million in 2017 and continue to grow until 2021. Pharmaceutical factories develop, manufacture, and market pharmaceutical drugs for use as medications to be administered to patients (or self-administered) to cure, immunize, or alleviate symptoms of various diseases. A pharmaceutical factory may manufacture generic or branded drugs, as well as medical devices. They are governed by several laws and regulations related to drug patenting, testing, safety, efficacy, and marketing.
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APAC is projected to contribute 42% by 2027. Another region offering significant growth opportunities to vendors is North America. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The pharmaceutical warehousing market in North America will grow steadily during the forecast period. This market is nearing maturity in North America. The North American pharmaceutical market is largely dominated by the US. This is because of an increase in the development of new pharmaceutical drugs in the US. This development encourages various clinical trial supply and logistics companies to expand their existing distribution channels in North America. The rising prevalence of chronic diseases, an aging population, and a shift toward home-based treatment in the US are some of the factors influencing the growth rate of the market in the country. In 2020, the US accounted for 68%-73% of the market volume in North America. In 2020, the US had 156 million cubic meters of cold storage and was the largest country for refrigerated warehouses used for various purposes, including pharmaceuticals.
The outbreak of COVID-19 adversely affected all countries in North America in 2020, especially the US. However, various business and industrial activities resumed with the relaxation of stringent lockdown restrictions owing to the availability of COVID-19 vaccines and the large-scale vaccination drives carried out by the governments of countries such as the US, Canada, and Mexico. In addition, there has been an increase in demand for healthcare and pharmaceutical supplies such as hospital supplies, gloves, and sanitizers, among others, which has propelled the growth of the market in 2022, and the growth is expected to continue during the forecast period.
The reports categorize the global pharmaceutical warehousing market as a part of the global air freight and logistics market within the global transportation market. The parent global air freight and logistics market cover revenue generated by companies providing air freight transportation; courier; and logistics services, including package and mail delivery and customs agents. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by application (pharmaceutical factory, pharmacy, and hospital), service (non-cold chain warehousing and cold chain warehousing), and geography (North America, APAC, Europe, South America, and the Middle East and Africa).
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Pharmaceutical Warehousing Market Scope |
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Report Coverage |
Details |
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Page number |
175 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 4.9% |
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Market growth 2023-2027 |
USD 15,751.86 million |
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Market structure |
Fragmented |
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YoY growth (%) |
4.5 |
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Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 42% |
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Key countries |
US, Canada, China, Japan, Germany, and UK |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
3G Warehouse Inc., Agility Public Warehousing Co. K.S.C.P, Atlanta Bonded Warehouse Corp., B.P.L. GmbH, CJ Logistics Corp., CMA CGM SA, DACHSER SE, DB Schenker, Deutsche Post AG, EFW Warehousing LLC, FedEx Corp., GEODIS SA, Hellmann Worldwide Logistics SE and Co KG, KRC Logistics, Kuehne Nagel Management AG, NFI Industries, Penske Truck Leasing Co. LP, PSA International Pte Ltd., United Parcel Service Inc., and XPO Logistics Inc. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Service
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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