Global Pace Setters
If you attended LM's 2007 Global 3PL Roundtable webcast recently, you're well aware of the current state of the international third-party logistics market: Business is pretty darn good. According to Evan Armstrong's presentation, the 3PL industry now rings in right around $415 billion—and there's no visible sign of it slowing down.
By Staff -- Logistics Management, 8/1/2007
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Quest For Quality Awards
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If you attended LM's 2007 Global 3PL Roundtable webcast recently, you're well aware of the current state of the international third-party logistics market: Business is pretty darn good. According to Evan Armstrong's presentation, the 3PL industry now rings in right around $415 billion—and there's no visible sign of it slowing down. The reason is simple: As supply chains become more global and more complex, shippers are turning to their 3PLs more than ever to stretch operations into unfamiliar regions of the world.
For 2006, in the U.S. alone, 3PL gross revenues grew by $9 billion to $113 billion—a 9.5 percent increase over the previous year, according to Armstrong's firm Armstrong & Associates, Inc. And as LM's John Paul Quinn recently wrote, these are the kind of numbers that other sectors of the logistics industry—and most other industries and businesses—only dream about. However, all of our leading sources agree that the greatest profit potential for 3PLs will lie in international markets as manufacturers continue to offshore outsourcing and globalized supply chains continue to expand.
According to LM readers, there are 12 third-party logistics providers that are performing top-notch service here in the U.S. and around the world. Expeditors International of Washington took top prize this year, but only by a nose, posting a 36.81. However, this was one of the tightest races for top position the category has ever seen, with Expeditors and the next four 3PLs separated by less than a full point.
Cardinal Logistics (36.49), Transplace (36.46), Ozburn-Hessey Logistics (36.18), and Landstar Global Logistics (36.03) were all hot on the heels of Expeditors, all posting impressive scores in Order Fulfillment, Transportation/Distribution, and Inventory Management. A quick look across the board shows us that Landstar took first place in Carrier Selection/Negotiation (7.42) and Transportation/Distribution (8.63); Ozburn-Hessey won the Order Fulfillment race with a 8.57; Cardinal Logistics took the prize for top Inventory Management (6.76); and Transplace edged out Expeditors for top position in the critical Logistics Information Systems category with a 6.89.
This will be one of the most interesting segments to watch over the coming year, with hints of more merger and acquisitions coming down the pike. However, one thing should remain perfectly clear: As long as these top 3PLs can continue to gain network strength and improve their international transportation management element they should be making a repeat trip to the winner's circle for years to come.
Third-Party Logistics Companies
| Carrier Selection/Negotiation | Order Fulfillment | Transportation Distribution | Inventory Management | Logistics Information Systems | Weighted Score | |
| All scores are weighted. Weighted scores are determined by multiplying the average raw scores by the average importance of each attribute (1= least important; 5= most important). To find the attributed weights for this category, see the introduction to the Quest for Quality report. Source: Logistics Management, Reed Research Group |
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| Expediters Int'l of Washington | 6.79 | 8.45 | 8.50 | 6.20 | 6.87 | 36.81 |
| Cardinal Logistics | 6.55 | 7.93 | 8.50 | 6.76 | 6.75 | 36.49 |
| Transplace | 6.95 | 8.23 | 8.57 | 5.81 | 6.89 | 36.46 |
| Ozburn-Hessey Logistics | 6.79 | 8.57 | 8.04 | 6.44 | 6.35 | 36.18 |
| Landstar Global Logistics | 7.42 | 8.08 | 8.63 | 5.79 | 6.11 | 36.03 |
| ADP Logistics (A. Duie Pyle) | 6.58 | 8.16 | 8.57 | 5.85 | 6.35 | 35.50 |
| FedEx Supply Chain Services | 6.76 | 8.14 | 8.15 | 5.48 | 6.51 | 35.04 |
| NYK Logistics | 6.35 | 8.16 | 7.23 | 5.60 | 6.02 | 33.36 |
| Menlo Worldwide | 6.60 | 7.65 | 7.51 | 5.20 | 6.34 | 33.30 |
| Ryder | 6.86 | 7.00 | 7.61 | 5.35 | 6.39 | 33.21 |
| C.H. Robinson Worldwide | 6.53 | 7.62 | 7.74 | 5.36 | 5.73 | 32.99 |
| APL Logistics | 6.73 | 7.27 | 7.54 | 5.39 | 5.96 | 32.88 |
| AVERAGE | 6.44 | 7.42 | 7.54 | 5.43 | 5.86 | 32.69 |
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