The transport and logistics market has grown rapidly in recent years. The sector's global turnover rose to €2.7 trillion. Globalisation, population growth and consumer behaviour are said to be behind the growing demand for transport. However, profitability of companies in transport and logistics have lagged behind revenue growth.
BCG looked at the figures up to 2014 and found that the total value of the sector has increased by 22 per cent since 2005. In its report, the firm divides the value chain into four parts: infrastructure, execution (the actual transport), logistics services and logistics consultancy services. Execution accounts for sales of as much as €2.3 trillion, of which €1.4 trillion comes from transport via highways. Maritime transport accounts for second place with 312 billion euros of turnover. The logistics services component also contributed to the high global turnover. Logistics service providers recorded a turnover of 658 billion euros.
Profit growth continues to lag
BCG finds that it has been difficult for transport companies and logistics players to achieve higher profits as well. EBIT grew by just 2 per cent between 2005 and 2014. Here, a clear difference can be seen between large companies and smaller ones. The 10 largest players in the four components saw their profits rise by an average of 18 per cent. The consultancy argues that the difference in profit growth can be explained by, for example, the failure of growth strategies designed to strengthen market share in new markets. The companies that performed better did manage to take advantage of global trends and implement new strategies.
Forecast 2018
The agency also makes a forecast for the period to 2018. For instance, growth will decline in nine out of 16 different segments in the coming years. There is no contraction in sales in any segment. The following segments are expected to see the least growth in turnover: mail delivery (0.6 per cent), logistics services focusing on the transfer of air cargo to sea transport (1 per cent), sea and air transport (2.2 per cent and 2.1 per cent) and airports (2 per cent).
Until 2018, strong growth is expected among distributors and wholesalers (6.8 per cent), contract service providers (6.8 per cent) and parcel delivery companies (8.5 per cent). Logistics consultants will record revenue growth of 10 per cent, according to BCG.
Editorial LogistiekProfs
