The global distribution services market was valued at almost USD 125 billion in 2016 and is expected to surpass USD 160 billion by 2021.
Procurement market intelligence analysts have announced its latest market research report on distribution services for the period 2017-2021. This market analysis discusses the major drivers and key emerging trends that will influence the growth of the global distribution services market during the forecast period. Some of the top vendors listed in this industry analysis include DHL, XPO Logistics, Ryder, Americold, and FedEx.
APAC accounted for around 39% of the overall market share during 2016 to become the dominant shareholder in the global distribution services market. China is the key revenue contributor in the distribution services market in APAC.
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According to Angad Singh, a procurement specialist at Technavio for research on category spend intelligence, “Service providers are increasingly automating several manual processes to address labor shortage. Automated handling technologies use less space and can integrate with conveyor systems and shipping trailers. Automation in industries can bring about benefits such as real-time visibility to every stage and streamlined material flow.”
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The new procurement market intelligence report analyzes some of the key drivers and trends responsible for the growth of this market and its sub-segments.
Flexibility in delivery options
Buyers can benefit from round-the-clock services by engaging with third-party distribution service providers. This is especially useful for retailers who require speedy stock replenishment services during peak seasons as well as for e-commerce firms that are facilitating same day delivery. Furthermore, buyers also benefit from reduced paperwork, billing, and audits as service providers will manage multiple invoices, contact points, and bills, allowing them to focus on core business activities.
Growth of e-commerce
The growth of the global online retail sector is resulting in large shipment volumes, which require warehousing and DCs to handle logistics. As a result, buyers increasingly rely on third-party DCs to streamline their shipment flows by using regional hubs to meet faster delivery flows, increase efficiency in order fulfillment, and reduce costs.
Need for reduced operational costs
Buyers seek outsourcing distribution activities to reduce capital investment in facilities, material handling equipment, and personnel. Suppliers have collaborative partnerships with staffing firms that help them in managing labor shortages and meeting seasonal rush demand, which helps organizations achieve the cost efficiency.
A more detailed analysis is available in the procurement market intelligence report titled, ‘Global Distribution Services – Procurement Market Intelligence 2017’.
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