North America Contract Logistics Market Trends

Statistics for the 2023 & 2024 North America Contract Logistics market trends, created by Mordor Intelligence™ Industry Reports. North America Contract Logistics trend report includes a market forecast to 2029 and historical overview. Get a sample of this industry trends analysis as a free report PDF download.

Market Trends of North America Contract Logistics Industry

This section covers the major market trends shaping the North America Contract Logistics Market according to our research experts:

Growing E-commerce in the Region Driving the Contract Logistics Market

The estimate of US retail e-commerce sales for the third quarter of 2022, adjusted for seasonal variation but not for price adjustments, was USD 265.9 billion, up by 3.0% (0.5%) from the second quarter of 2022, according to a report released by the Census Bureau of the Department of Commerce. The predicted USD 1,792.0 billion in total retail sales for the third quarter of 2022 represents an increase of 0.7% (0.1%) from the second quarter. While total retail sales climbed 9.1% (minus 0.4%) during the same period, the third quarter of 2022 e-commerce projection increased by 10.8% (minus 1.2%) from the third quarter of 2021. In the third quarter of 2022, e-commerce sales made up 14.8% of total sales.

Canada has the fastest-growing e-commerce market among the three countries in the area, while the US has the largest and steadiest-growing market. In Mexico, e-commerce user penetration is not very high. However, throughout the projected period, the Mexican e-commerce market is anticipated to rise strongly.

Over 27 million Canadians used e-commerce in 2021, making up 72.5% of the country's total population. In 2025, this percentage is projected to rise to 77.6%. Retail e-commerce sales in Canada are rising steadily in real terms and as a share of overall retail, thanks to a rise in online shoppers. The United States, ahead of China and Japan, was the second-largest e-commerce market in terms of revenue in 2021. In the upcoming years, e-commerce sales may continue to rise. The percentage of e-commerce in all US retail online sales is 13.3%.

Most e-commerce businesses award warehouse and distribution service contracts to logistics service providers. Businesses need to have technical solutions that quicken fulfillment operations because of the high-velocity e-commerce business models.

Startups in the fields of on-demand and cloud-based warehousing are becoming more and more well-known as e-commerce takes off. As opposed to long-term leases for a set space, these businesses give businesses the freedom to use the warehouse space by seasonal demand. These businesses include Stord, Flexe, and Flowspace, to name a few. Long-term projects are also given to these businesses by their clients. Some businesses also provide fulfillment services, giving the current standard contract logistics service providers fierce competition.

Traditional commercial real estate firms also make technology investments. For instance, ProLogis, the industry leader in logistics real estate, offers a venture fund devoted to financing innovations in contract logistics.

North America Contract Logistics Market - Ecommerce Revenue in North America, (In USD Billion) in 2017-2021

Manufacturing and Automotive Expected to Witness High Growth During the Forecast Period

Manufacturing businesses spend a lot of time trying to come up with new and inventive ways to outperform the competition, whether it is by developing new manufacturing techniques, better products, or better supply chain management.

Effective routing management is the crux of logistics for the manufacturing sector. To cut the cost of sending goods to the vendors, logistic providers help with bills of lading and freight planning. Manufacturers who outsource their logistical needs avoid the payroll, benefit, and liability costs associated with hiring in-house workers, in addition to saving money on shipping.

The pandemic's impact on US manufacturing in 2022 will be beneficial. Due to the introduction of vaccines and increasing demand, the recovery gathered steam in 2021, and by the middle of the year, industrial production and capacity utilization were higher than they were before the pandemic. Strong rises in new orders across all key subsectors could spur further expansion in 2022. Manufacturing GDP growth in the United States is predicted to reach 4.1% in 2022, according to industry sources. In Canada, lockdowns were loosened, which resulted in a rise in manufacturing activity in 2021.

The COVID-19 pandemic, continuous cost volatility, policy decisions, and industry disruption risk continue to be factors for the manufacturing sector. There is pressure on US industries to start producing essential commodities domestically and rely less on European and Asian nations as a result of the pandemic-related shortages.

Most of the management of the North American automotive supply chain is done by logistics businesses. The majority of the engines and gearboxes used in Mexican automobile manufacturing are imported from the United States.

North America Contract Logistics Market - Value added by manufacturing industry, In North America, 2018-21, In USD Billion

North America Contract Logistics Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)