Allied Market Research recently published a report, titled, “Fifth-Party Logistics Market by Type (Transportation, Warehousing, and Other Services) and Application (E-commerce, Traders, Logistics Company, and Others): Global Opportunity Analysis and Industry Forecast, 2025–2035.” According to the report, the global fifth-party logistics industry is anticipated to be valued at $9.21 billion in 2025, and is expected to reach $17.30 billion by 2035, growing at a CAGR of 6.5% from 2025 to 2035.
Drivers, restraints, and opportunities-
Rise in the efficiency of supply chain & management systems, expansion of the e-commerce industry, and increase in international trade drive the growth of the global fifth-party logistics market. On the other hand, government barriers for logistics companies and complex supply chain impede the market growth to some extent. However, introduction of blockchain and technological advancements are anticipated to pave the way for multiple opportunities in the industry.
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Due to the outbreak of Covid-19, the government across the globe was forced to implement strict lockdowns and make social distancing compulsory to curb the spread of the virus. This resulted in a severe drop in global trade, significantly reducing demand for logistics across the globe.
Moreover, due to the nationwide lockdown, logistics service providers were obliged to partially or entirely shut down their operations, causing supply chain delays.
However, there has been rise in pharmaceutical and e-commerce sales during the pandemic, which has improved the demand for the logistics business.
The transportation segment to dominate by 2035-
By type, the transportation segment is expected to contribute to more than half of the global fifth-party logistics market share by 2025, and is anticipated to retain its dominance throughout the forecast period. This is owing to the increase in demand to construct, organize and implement multimodal transportation methods which provide optimum route planning for minimizing transportation costs. The warehousing segment, however, would showcase the fastest CAGR of 6.9% by 2035. This is due to increase in demand for automated warehousing distribution systems effective distribution.
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The e-commerce segment to hold the largest share by 2035-
Based on application, the e-commerce segment is expected to hold the lion’s share in 2025, and contribute to more than half of the global fifth-party logistics market. This segment is anticipated to continue its lead during the forecast period. However, the logistics company segment is expected to witness the highest CAGR of 6.9% by 2035. 5PL companies serve third-party logistic companies by acting as logistics aggregators, and they aggregate third-party logistics demands into bulk volumes for more favorable rates. This drives the growth of the segment. The report also includes an analysis of the traders segment.
Asia-Pacific, followed by North America, is anticipated to grow with the highest CAGR during the forecast period-
Based on region, Asia-Pacific followed by North America is anticipated to grow at the fastest CAGR of 7.4% during the forecast period. This is owing to the growth of thee-commerce industry, rise in international trade in the region. However, the market across Europe would lead the global fifth-party logistics market by contributing to more than one-third of the total market share by 2025.
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Key players in the industry-
Toll Holdings Ltd
Boston Consulting Group
McKinsey & Company
Renaissance Network Reinvent
Bain and Company
5PL Logistics Solutions LLC
MGL Global Logistics
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