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The Europe Third-Party Logistics (3PL) Market size is estimated to grow at a CAGR of 24.7% between 2022 and 2027, and the size of the market is forecast to increase by USD 458.87 billion. The growth of the market depends on several factors, such as the growing complexity of in-house logistics operations, the cost reduction by utilizing 3PL services, and the growth in the automobile and auto components industry.
This Europe third-party logistics market report extensively covers market segmentation by end-user (manufacturing, retail, consumer goods, healthcare, and others) and service (transportation, warehousing and distribution, and others). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the third-party logistics market in Europe report includes historic market data from 2017 to 2021.
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The report includes the adoption lifecycle of the Europe Third-Party Logistics (3PL) Market, spanning from the innovator’s stage to the laggard’s stage. Furthermore, the report includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Third-Party Logistics Market in Europe Customer Landscape
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.
The growing complexity of in-house logistics operations is notably driving Europe 3PL market growth. Difficulties in fleet management, a shortage of skilled drivers, a lack of IT infrastructure such as track management systems, and operational issues are some of the challenges shippers face in managing in-house logistics. This model also reduces the shippers' focus on their core business areas. Manufacturers around the world are expanding their manufacturing capacities and operations, increasing logistical requirements in terms of moving raw materials to factories and finished goods to retailers and distributors.
This increases the complexity of SCM for the manufacturing company, leading more and more manufacturers to outsource some or all their SCM functions to 3PL providers. Also, given the benefits of outsourcing in terms of increased operational efficiency and cost savings, shippers are increasingly outsourcing the logistics part of their operations to 3PL players, enabling them to focus on their core competencies. Such factors are therefore expected to drive the growth of the third-party logistics market in Europe over the forecast period.
The increase in M&A activities is an emerging trend in the Europe 3PL market during the forecast period. M&A activity has played a key role in building the current structure of the global 3PL industry. The main drivers of mergers and acquisitions are the growing need to expand service offerings, expand geographic reach, achieving economies of scale, obtaining assets and/or technology, acquire new customers, and securing talent management in target industries. The 3PL market in Europe has witnessed an increase in the number of M&A activities in recent years.
One of the major reasons behind the increasing demand for 3PL in the region is the growth in online retailing. For instance, in September 2021, A.P. Moller - Maersk announced the acquisition of HUUB. The main aim is to accelerate the development of our omnichannel offering. This will aid customers in focusing on their core business of producing and selling goods and swiftly bringing them to the end consumers. Hence, such factors are expected to fuel the growth of the Europe third-party logistics market during the forecast period.
The high operational cost and competitive pricing are major challenges impeding the Europe 3PL market growth during the forecast period. With the increasing demand for 3PL services such as transportation, warehousing, and distribution, companies are also looking for value-added services and professional supply chain solutions. The available opportunity to capitalize on providing value-added services has increased the price-based competition among 3PL service providers in Europe. The fragmentation in the market also leads to price competition among providers. Businesses are often under price pressure as customers demand additional services at the expense of basic services. The market is characterized by its capital-intensive nature.
The 3PL market in Europe requires a capital-intensive infrastructure in terms of a large fleet of vehicles and containers at ports, technologically equipped warehouses specialized in storing different kinds of products, and a skilled workforce. The 3PL service providers must control their operational costs to compete in the market. Hence, such factors are expected to hinder the growth of the Third-Party Logistics Market in Europe during the forecast period.
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 Europe third-party logistics market.
AP Moller Maersk AS: The company offers third-party logistics such as booking, documentation, warehousing, and packaging.
Baltic Logistics Group: The company offers third-party logistics such as air, sea, road, and rail freight services.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market vendors, including:
Technavio report provides an in-depth analysis of the Europe third-party logistics market and its players through combined qualitative and quantitative data. The analysis classifies vendors into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The manufacturing segment will account for a major share of the market's growth during the forecast period. The growing manufacturing sector provides substantial growth opportunities to 3PL service providers. For instance, according to World Bank data, over the past two decades, the contribution of the manufacturing industry to the GDP of Germany fell from 8.3% in 2011 to 5.1% in 2021. Therefore, manufacturing companies have adopted various business models that follow an integrated approach to providing products and services. Such factors will increase the segment's growth during the forecast period.
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The manufacturing segment was valued at USD 20.40 billion in 2017 and continued to grow until 2021. In Europe, Western Europe is considered the hub of manufacturing. However, rising wages and rents in Western Europe have shifted the focus of the industry to Central and Eastern Europe. The Czech Republic, Poland, Romania, and Hungary are becoming important hubs for manufacturing innovation due to the ready access to cash subsidies and tax incentives. The availability of low-wage and qualified workers is also shifting corporate attention from Western Europe to Eastern Europe. Therefore, the factors mentioned above are expected to drive the growth of the manufacturing segment during the forecast period.
Service Segment Analysis
Based on service, the Europe third-party logistics (3PL) market has been segmented into transportation, warehousing, and distribution, and others. The transportation segment will account for the largest share of the service segment. The improvements in infrastructure facilities provide opportunities to enhance operational efficiencies in the transportation and logistics market. There is increased competition among vendors for providing quality service at low rates. 3PL vendors are also focusing on security and reliability. With the intense competition among vendors, M&A is expected to increase as vendors focus on providing advanced services and competing with foreign vendors. For instance, in November 2022, FourKites Inc. (FourKites) announced its partnership with Sony Network Communications Europe. This collaboration will help enterprise customers solve their most complex use cases. Such factors will increase segment growth during the forecast period.
The Europe third-party logistics (3PL) market 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.
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Third-Party Logistics Market Scope In Europe |
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Report Coverage |
Details |
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Page number |
172 |
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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 24.7% |
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Market growth 2023-2027 |
USD 458.87 billion |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
21.25 |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ACP Freight Services Ltd., AP Moller Maersk AS, Baltic Logistics Group, C H Robinson Worldwide Inc., CMA CGM SA, Deutsche Bahn AG, Deutsche Post AG, DSV AS, Expeditors International of Washington Inc., FedEx Corp., FM Logistic, GEODIS SA, Hub Group Inc., J.B. Hunt Transport Services Inc., Kintetsu Group Holdings Co. Ltd., Kuehne Nagel Management AG, Raben Management Services sp. z o.o, Sinotrans 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, Market condition analysis for 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 End-user
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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