Acquisitions Like That of Bolloré Africa Logistics by MSC Group to Boost the Growth of Global Logistics Services (3PL & 4PL) Market in the 2022-2031 Timeframe

A third-party logistics service company, or 3PL company as it is known, helps in providing transport, storage, and delivery of a company’s goods and services to its customers. Thus, a company can outsource its logistics module to a 3PL company which can pick, pack, store, and deliver the goods to the intended destination. A fourth-party logistics (4PL) service company, on the other hand, has a much wider scope as it takes care of the entire supply chain management of a company. Thus, a company who wishes to outsource its supply management functions can do so with the support of a 4PL company.  

Forecast Analysis:

According to the report published by Research Dive, the global logistics services (3PL & 4PL) market is expected to gather a revenue of $3,040 million by 2031 and grow at 9.7% CAGR in the 2022–2031 timeframe. An increase in the adoption artificial intelligence (AI) in the logistics sector which is predicted to be the primary growth driver of the logistics services (3PL & 4PL) market in the forecast period. Additionally, growing expanse of e-commerce sector across the globe is anticipated to push the market forward. Along with this, advantages such as cost-effectiveness of outsourced logistic services is projected to offer numerous growth and investment opportunities to the market in the analysis timeframe. However, lack of skilled logistics professionals is estimated to create hurdles in the full-fledged growth of the logistics services (3PL & 4PL) market in the coming period.

Regionally, the logistics services (3PL & 4PL) market in the Asia-Pacific region is expected to be highly dominant by 2031. Continued development of logistics infrastructure and transportation services in this region is expected to be the leading factor behind the growth of the market.

Some prominent market players include C.H. Robinson Worldwide, Inc., 4PL Group, Global4PL, DB Schenker, Kuehne + Nagel International AG, Orkestra SCS, DHL, Maersk, Phoenix Freight Systems, FedEx Corporation, and many others.

Covid-19 Impact on the Market

The outbreak of the Covid-19 pandemic has had a massive negative effect on almost all industries and businesses across the world. The logistics services (3PL & 4PL) market, too, faced a negative impact of the pandemic. The pandemic witnessed shutdown of major industries and companies which slumped the supply of finished goods. Also, the demand for various goods reduced during the pandemic. Hence, overall trade was affected which brought down the demand for logistics sector and reduced the growth rate of the logistics services (3PL & 4PL) market.

Significant Market Developments

The significant companies operating in the industry are adopting numerous growth strategies & business tactics such as partnerships, collaborations, mergers & acquisitions, and launches to maintain a robust position in the overall market, thus helping the logistics services (3PL & 4PL) market to flourish. For instance:

• In December 2021, MSC Group, a leading shipping company, announced the acquisition of Bolloré Africa Logistics, a leading transport company operating in the whole of Africa. This acquisition is predicted to help MSC Group to expand its operations in the African continent and gain a lead over its competitors.
   
• In February 2023, Maersk, a global leader in shipping services, announced that it had signed a partnership agreement with Ashdod Port Company, a port management company handling the Ashdod Port in Israel. This partnership is predicted to boost the market share of both the companies substantially in the next few years.
   
• In March 2023, Dubai South, one of the largest logistics market players, announced that it was collaborating with dnata, a global air services provider. This collaboration is aimed at enhancing the logistical services and cargo handling in the Dubai South area and thus, further economic investments. The collaboration will help both the partners to pool their resources and integrate their operations efficiently.