U.S. third-party logistics sector sees solid gains

Looking for signs that the U.S. economy is picking up steam? You'll find several in U.S. Gains Carry 3PLs—2011 3PL Market Analysis and 2012 Predictions, the latest publication from the research and consulting firm Armstrong & Associates. According to the report, growth in the third-party logistics (3PL) market in 2011 was three times that of the U.S. gross domestic product (GDP).

Year-on-year growth for the North American 3PL market as a whole was 5.2 percent for gross revenue and 5.9 percent for net revenue. Meanwhile, "grim" European and "cooling" Asian economic conditions resulted in flat international performance, Armstrong & Associates said.

Domestic North American transportation and value-added warehousing were the bright spots in 2011. The domestic transportation management segment led the market, with gross and net revenues both increasing 12.2 percent from 2010 levels. Net income was 17.4 percent of net revenue. Value-added warehousing and distribution saw increases of 8.2 to 8.4 percent. Net income margins in this mature segment improved to 3 percent.

Dedicated contract carriage continued its resurgence in 2011, achieving net income growth of 12.5 percent. Trucking companies, including dedicated contract carriers, continue to keep equipment supplies lean, thus preventing an oversupply of assets and keeping prices stable, researchers noted.

Armstrong's annual report examines revenue, profitability, and growth trends in the 3PL industry and its major segments worldwide. For more information, click here.