The Annual Revenue Base Of The Global 3PL Industry Is Now Estimated To Be Nearly $750 Billion
It is evident how the world’s demand for last mile deliveries have created the demand and tremendously increased the revenue potential of 3PLS. Quoting from an article by Robert C. Lieb, PH.D Professor Of Supply Chain Management at the D’Amore-Mckim School of Business at Northeastern University,
“The scale of the 3PL industry has increased tremendously since my first CEO study was initiated in 1994. At that time, many of the companies perceived as the major players in the industry were generating annual operating revenues in the tens of millions of dollars. In many instances those companies now have annual operating revenues well in excess of a billion dollars per year. Collectively, the annual revenue base of the global 3PL industry is now estimated to be nearly $750 billion.”
The driving force behind the growing revenue for 3PLS is most likely spurred by the fast traction and velocity of e-commerce worldwide and also increased operating costs and the labor crunch. More companies now see outsourcing to 3PLs as an avenue to save on logistics cost (without having to support their own fleet) as well as increasing their productivity and customer service.
More and more 3PLs not limited to just the big boys in the market like UPS, are able to use the latest technology to provide visibility of the last mile delivery process and also the ability to share this visibility with the companies engaging them. This in turn allow companies who outsource, to provide timely last mile delivery support to their customers like tracking of their delivery online, receiving real time delivery notifications with POD (proof of delivery) etc. Outsourcing to the 3PLs seems like an unstoppable trend that will seek to continue.