FMCG Logistics Market Registering a CAGR of 4.6% from 2020 to 2027

The global FMCG logistics market was valued at $1,056.58 billion in 2019, and is projected to reach $1,400.80 billion by 2027, registering a CAGR of 4.6% from 2020 to 2027. By mode of transportation, the roadways segment was the highest revenue contributor in 2019, accounting for $431.66 billion, and is estimated to reach $518.08 billion by 2027, registering a CAGR of 3.30% during the forecast period.

Logistics is widely known as the process of coordinating and moving resources, such as equipment, food, liquids, inventory, materials, and other products, from one location to the storage or the desired destination. It is the management of the flow of goods from one point of origin to the point of consumption to meet the requirement of customers. FMCG logistics management focuses on the efficiency and effective management of daily activities concerning the transportation of daily usable goods from one place to another.

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Companies covered in this report study:
A.P. Moller – Maersk, C.H. Robinson Worldwide, Inc., DB SCHENKER (Deutsche Bahn Group (DB Group)), Deutsche Post AG (DHL Group), DSV (DSV Panalpina), FedEx, Geodis, Kuehne+Nagel, United Parcel Service, Inc. (UPS), and XPO Logistics, Inc.

COVID-19 impact analysis
With the advent of COVID-19 pandemic across the globe, countries were left with no choice but to temporarily discontinue their trading activities with one another, which adversely impacted the supply of goods and caused disruptions in the supply chain. Moreover, countries across the world imposed nationwide shutdown of almost all retail outlets for non-essential consumer goods, including clothing, electronics, and fashion accessories. This has eliminated the need for transportation of these products, thereby causing a massive blow to the FMCG logistics industry around the world. The food & beverages industry has also faced the wrath of the global pandemic as offline dining venues, such as restaurants and cafes, were shut down and even online food orders witnessed a decline.

The global FMCG logistics market is segmented based on product type, service type, mode of transportation, and region. Product type includes food & beverages, personal care, household care, and other consumables. Service type includes transportation, warehousing, and value added services. Mode of transportation includes railways, airways, roadways, and waterways. Based on region, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Rise in tech-driven logistics services and growing adoption of IoT-enabled connected devices
Changing technological trends and implementation in FMCG application have completely changed the FMCG logistics market. Companies started integrating new-age technologies, such as IoT, robotics, analytics, and Big Data, into their FMCG supply chain. The implementation of modern technology, such as drone delivery, in logistics has also reduced the lead time and inventories for FMCG companies, thus fulfilling their demand for customization and fast delivery. For instance, in September 2019, FedEx collaborated with Wing Aviation LLC, an Alphabet company, and Walgreens, a retail pharmacy company, to launch a first-of-its-kind drone delivery service in Christiansburg, Virginia. Moreover, increasing penetration of IoT in the logistics sector enables freight companies and consumers to directly access real-time information via internet. Therefore, the implementation of tech-driven logistics services is expected to help FMCG companies to optimize their assets efficiently, thereby propelling the growth of the FMCG logistics market.

Earlier, consumers used to buy products by going to the shop; however, now changing habits have resulted in online ordering and online processes. The rising awareness of personal care products, adoption of health & wellness goods, and the growing popularity of cosmetics and many others contributed to the popularity and sale of consumer goods. Moreover, growing disposable income and changes in consumption patterns and lifestyles along with improved purchasing power promise exciting growth opportunities for the FMCG logistics market. Furthermore, increase in income, urbanization, and growth in organized retail drive the food & beverages consumption among consumers. These factors are anticipated to boost the consumption of consumer goods, products, and services, thereby offering extensive opportunities for the FMCG logistics market.

Reduction in cost of transportation and timely delivery of consumer goods, such as perishable items and groceries, pose a challenge to logistics service providers. Logistics companies have the opportunity to use multi-modal transportation system due to rising amount of orders to be delivered in limited time. Multi-modal transport uses the most efficient combination of transport modes, keeping the freight costs down to increase the efficiency of the supply chain. For example, APL Logistics provides ShipMax solution to its customers. It includes pairing with compatible trucking partners as well as allowing customers to take advantage of better load utilization and delivery optimization, thereby enabling customers to maximize transportation budget. Therefore, cost cutting and lead time reduction by adopting multi-modal system pose exponential growth opportunities for the key players operating in the FMCG logistics market.

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Key Benefits For Stakeholders
• This study presents analytical depiction of the FMCG logistics market analysis along with the current trends and future estimations to depict the imminent investment pockets.
• The overall market potential is determined to understand the profitable trends to gain a stronger foothold.
• The report presents information related to key drivers, restraints, and opportunities of the market with a detailed impact analysis.
• The current FMCG logistics market size is quantitatively analyzed from 2019 to 2027 to benchmark the financial competency.
• Porter’s five forces analysis illustrates the potency of the buyers and suppliers in the FMCG logistics industry.

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