The contract logistics market in the US share growth by the retail segment will be significant for revenue generation. The significant increase in government expenditure on logistics infrastructure and the growth of the e-commerce industry will drive the market growth through this segment. The contract logistics market in the US is set to grow by USD 9.04 billion from 2021 to 2026, progressing at a CAGR of 5.98% as per the latest market report by Technavio.Contract Logistics Market In US – Segmentation Analysis
The Contract Logistics Market in the US is segmented by End-user (Retail, Pharmaceutical, Automotive, and Others) and Type (Outsourcing and Insourcing). Technavio report provides an accurate prediction of the contribution of all the segments to the growth of the contract logistics market size in the US and actionable market insights on each segment.
Contract Logistics Market In US – Drivers & Challenges
The key factor driving the contract logistics market growth in the US is the growth in the e-commerce market in the US. For instance, according to the Census Bureau of the Department of Commerce, in the third quarter of 2021, e-commerce sales increased 6.6% from the third quarter of 2020, while total retail sales increased 13.1% in the same period. With the outbreak of COVID-19, there has been an increase in the growth of the e-retail industry, which has created the demand for contract logistics service providers serving electronics, fast-moving consumer goods (FMCG), pharmaceuticals, and food and beverage industries. Big brands, such as Puma and Adidas, have many packages to be shipped per day. According to a recent survey by Accenture and GEODIS (of 200 large retail & consumer goods brands), vendors expect the shift to online sales on their websites. This shift is expected to remain even after the pandemic subsides and is anticipated to create opportunities for contract logistics vendors in the next five years.
However, the key challenge to the contract logistics market growth in the US is the increased lead time and supply-demand imbalance. Other factors such as limited workforces and reduced working time have further restrained the logistics activities. Domestic transportation services have also been affected by the pandemic-induced restrictions, as there has been an imbalance between incoming and outgoing freight in the restricted areas. Furthermore, contract logistics vendors have been facing complications due to changing norms in different states and countries, which resulted in delayed lead time. Such factors are expected to limit the growth of the market in focus in the forecast period.About Us
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