3PL Evolution: What’s the Impact on Asset and Regional Competitiveness?

We’re seeing major 3PL acquisitions and tie-ups practically every few weeks now. The industry is undergoing huge change as companies look to expand footprint, rationalize and make more efficient expanse structures and evolve their service offerings to clients. See the current article in American Shipper about XPO’s acquisition of Con-way for a real-time look at rationalizing expense structures.

This is a huge trend and will get bigger. What’s most interesting to us is how third-party logistics providers of various sorts are positioning to distinguish quite evolved service offerings. Some of this is happening as we speak, and undoubtedly more will unfold in the coming years. The trend of outsourcing corporate logistics is clearly on a march where cargo movement and product harboring and management services will increasingly become an even wider array of services including value-add functions, This is occurring today but we believe that the pace will increase quite substantially over the next 3-5 years.

This trend has serious implications for seaports, airports and inland ports, and also for economic development organizations. Those that understand their competitive position and apply that informed proposition to the right audiences will win out. We think that 3PL firms will be a large target market, but in a very different way than most would suspect today. We’re entering a change period, those that get it will do exceedingly well.