Asia Pacific region has been experiencing an increase in its logistics stock by approximately 90 million square meters since the past decade, and an increase in contract logistics from USD 55 billion in 2010 to USD 106 billion in 2020.
Mumbai, India, July 04, 2022 (GLOBE NEWSWIRE) -- The APAC third-party logistics market is highly fragmented and the competitive dynamics are projected to shift in the coming years with the presence of rapidly evolving economies. The Asia pacific Third-Party Logistics market has experienced tremendous growth in recent years and even in 2020 the market witnessed a positive growth rate despite the challenges brough by COVID-19. Furthermore, government measures are being conducted to further accelerate the APAC third-party logistics market. In the region, regulations and laws governing the logistics business apply to a wide range of services. Furthermore, government policies influence the expansion of such services.
Impact of Covid-19
The Asia Third Party Logistics market also felt the heat of the recession in 2020 due to lockdowns imposed across the world yet, the market witnessed a positive growth driven by E-commerce growth across the region.
E-commerce Encouraging Growth
E-commerce is a major driver of third-party logistics growth, and Asia is the most populous area in the globe, with China and India accounting for the majority of e-commerce transactions.
Further Key Findings
Emergence of Hyperlocal Delivery Services: By using a hyperlocal delivery service, e-commerce companies are guarantying delivery within a day. When it comes to food and grocery delivery, the service providers have increased and proven to be extremely effective. As a result, organizations in the FMCG and fashion industries are using this service to provide faster deliveries to their clients.
Asia Pacific Free Trade Agreement: The Regional Comprehensive Economic Partnership (RCEP), a new Asia-Pacific trade agreement, went into force on January 1, 2022, to encourage free trade and create the world's largest trade association. The agreement's main goal is to cut tariffs and grant tariff concessions of up to 90% to member countries, which include 15 east Asian and Pacific economies.
Increasing population: The Asia Pacific region, which includes India and China, is home to 60% of the world's population. The region is diverse, with some countries seeing rapid population increase and others experiencing moderate growth. Such a huge population group in the region, and the forecasts for further growth, brings into picture the present and future demand in commodity markets. In such a scenario, 3PL market will also play a crucial role.
Growing demand for Greener Supply Chains: Due to the negative effects of climate change, today's customer desires an eco-friendly atmosphere and is striving toward sustainability. As a result, third-party logistics companies are implementing greener supply chain technology to reduce carbon footprints. Because transportation is one of the most significant contributors to climate change, the Regional Action Programme (RAP) includes requirements to progress toward decarbonization in the transportation system.
Increasing Disposable Income: Disposable income is considered to be an essential element in measuring the overall condition of a nation. The rising national disposable income indicates good status of country’s performance and thereby leads to the development of all the sectors of the economy. Hence, the 3PL market is also expected to rise in the future.