3PL Software Market

The 3PL software market size was valued at USD 1.3 billion in 2021 and is projected to reach USD 2.4 billion by 2030, expanding at a CAGR of 6.5% during the forecast period, 2022 – 2030. The growth of the market is attributed to expanding e-commerce sector, desire to enhance corporate efficiency, and emergence of internet.

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A manufacturer can outsource its distribution and logistical functions via third-party logistics. Specialized services from a 3PL provider include cross-docking, inventory control, door-to-door delivery, and product packing. As manufacturers and retailers concentrate on their core strengths and outsource processes like logistics, where they lack experience, the demand for this service is projected to increase in the coming years. Firms are focusing on promoting their different expertise in production and supply due to growing competition in the market. The software helps businesses save a lot of time and money by reducing the need for warehouse space, transportation, and staff to carry out the logistics process. The dynamics of the 3PL sector are changing as a result of technological advancement. Companies can now take a customer-centric, consistently inventive, and flexible approach due to increased warehouse automation, data collection capabilities, and supply chain digitalization. Third-party logistics companies are thus continuing to invest in mobile technologies, blockchain solutions, and 3PL software in order to gain a competitive edge in a highly competitive market. The Internet of Things (IoT) and cloud-based logistics management solutions transform the data into useful information that adds value and can be used to inform strategic decisions and boost efficiency. Some capital-intensive companies are spending on information technology (IT) and utilizing predictive analytics to improve their supply chains. For instance, C.H. Robinson Worldwide, Inc. analyzes consumer data and notifies customers of severe weather or traffic disruptions by utilizing Artificial intelligence (AI) technology. Order fulfilment services are made efficient by the deployment of robots in warehouses and unloading docks.

Covid-19 Impact

The covid-19 pandemic had a negative impact on the logistics industry. Lockdown across the globe, supply chain disorders, and oscillating supply of raw materials forced manufacturers to shut down production leading to an unfortunate decline in market growth. The launch of vaccines to combat the Covid-19 pandemic is expected to contribute to the market growth over the forecast period. In many nations, the economy has begun to recover and has partially adapted to the pandemic restrictions.

Market Dynamics

The market research report on the 3PL software market provides a detailed analysis by focusing on facts, figures, historical data, existing restraints, major drivers, key trends, and competitive landscape with recent developments that can shape the overall performance or outcome of the market during the forecast period, 2022 to 2030.

Key Trends impacting

Digitization is the key market trend
The 3PL software market has experienced a lot of changes that have opened up a wide range of prospects for businesses in the logistics sector. The 3PL software market is anticipated to increase significantly during the forecast period due to the improvement in IoT and technology advancements. Factors such as rising demand for cloud-based solutions, the capacity to enhance operational effectiveness, and the ability to automate procedures are anticipated to create immense growth opportunities in the market during the projected period. Businesses can benefit greatly from outsourcing logistics operations to 3PL firms as they grow. These businesses use 3PL software to manage global logistics tasks like purchasing, freight handling, customs and export, and distribution to optimize global shipping operations. Increased focus on reducing costs and optimizing operations is estimated to offer lucrative growth opportunities in the coming years. The effectiveness of order fulfillment services is increased by using robots for unloading dock services and warehouse automation.

Major Drivers

Technological advancement is estimated to drive the market
The third-party logistics sector is changing due to a new era of technologies. Companies are embracing a creative, customer-centric, and flexible approach to supply chain management due to advanced data collecting tools, automated warehouses, and digitalization of the supply chain. The market is highly competitive for delivery logistics companies due to the expansion of online businesses. Online payment apps are increasing along with internet and smartphone usage, which is estimated to propel the market during the forecast period. Changing consumer lifestyles, economic expansion, and preferences for purchasing at their fingertips have all contributed to the market growth of 3PL software, which in turn has spurred e-commerce logistics. The demand for quick delivery services from today's tech-savvy consumers is fueling the logistics industry. Increasing adoption of warehouse management systems is also estimated to drive the market.

Existing Restraints

Lack of direct control over the process
Factors such as regulatory problems, inadequate infrastructure, and lack of qualified logistics professionals are anticipated to hinder the market growth. Increasing frequency of business outages brought on by software installation issues is estimated to hamper the market growth. High initial expenses are expected to impede market growth. virtualized automation is growing limited due to a lack of tools and techniques to address synchronization concerns. A company that uses third-party logistics services has to rely on the expertise, integrity, and dependability of the suppliers. In this case, a manufacturer relies on a third-party logistics provider, which results in a lack of direct control over the process. Additionally, the manufacturer is unable to keep an eye on what happens at the warehouse, which is estimated to compromise the quality of the products. The inability of manufacturers to regulate logistical services is expected to restrict the development of 3PL software. Rising internet orders and increased 3PL software traffic is projected to hinder the market growth. Regulatory compliance, economic pressures, constantly changing business environment, and Technology advancements are some of the factors hindering market growth.

Scope of the Report

The report on the global 3PL software market includes an assessment of the market trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Market Segment Insights

The 3PL software for roadways segment accounted for a key market share in 2021

Based on mode of transport, the market is segregated into 3PL software for railways, 3PL software for airways, 3PL software for roadways, and 3PL software for waterways. The 3PL software for roadways segment accounted for a key market share in 2021 and is projected to continue its dominance during the forecast period. The demand for roads in 3PL sectors has increased along with improvements in road infrastructure and cross-border trade between landlocked nations. Additionally, 3PL service providers offer first-party companies innovative delivery solutions by utilizing the modern software technologies available in the market, such as TMS and WMS. Growing demand for tariff surcharge management, contract management, and transportation route planning are estimated to boost the market. The growth of the roadways segment is anticipated to be fueled by the expanding public-private partnerships model and increasing focus on logistics infrastructure during the forecast period. The ability to connect your data with your ERP suite and check shipment status in real-time is anticipated to drive the three-party logistics software market. Additionally, the software makes it simple for employees to organize tasks like unloading and quality assurance inspections. The 3PL software for waterways segment is one of the most expensive modes of transportation. Leading organizations have partnered together to operate shipping operations that will conduct business across several locations. Additionally, as concerns about global pollution have grown, the use of the low-pollution shipping route known as the seaway has increased, significantly boosting the market share for third-party logistics software. To provide speedy and efficient transit services across nations, several airlines are launching logistics flights. Important products are transported using this means of transportation. Manufacturers are looking for quick deliveries due to growing prices and increased competition, which is increasing demand for 3PL software for airways.

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The dedicated contract carriage (DCC) segment is estimated to hold a key market share during the forecast period

On the basis of service types, the global market is fragmented into dedicated contract carriage (DCC), warehousing & distribution, international transportation management, domestic transportation management, and others. The dedicated contract carriage (DCC) segment is estimated to hold a key market share during the forecast period. DCC service providers help their clients' capital usage and transportation management integration to improve, furthering the adoption of committed contract carrier service by enabling their clients to concentrate on important business challenges and end users. The international transportation management segment is expected to grow at a rapid pace during the projected period. The management of international transportation is responsible for controlling the movement of commodities across international borders from suppliers to buyers. Factors such as increasing use of automation systems, expansion of global trade, and advancements in logistics services are driving the transportation management segment. Fully robotic warehousing distribution networks have a very low penetration rate, which is expected to offer lucrative opportunities for market players.

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The technological industry segment is anticipated to expand at a CAGR of around 6.5% during the forecast period

In terms of industry, the global market is divided into healthcare industry, food & groceries industry, elements industry, retailing industry, automotive industry, technological industry, and others. The technological industry segment is anticipated to expand at a CAGR of around 6.5% during the projected period. Using advanced technology software reduces the company's running expenses in the market, by attaining efficiency in the both operational and financial side of the business, which has increased demand for the 3PL software market. Technology has made it possible for 3PL software to offer complete transparency throughout the process of delivering goods and services to clients. Customers can use 3PL software to technologically record and track the entire delivery process and shipment. It is now becoming easier to integrate and automate logistics as the world's population increases due to the existence and ongoing development of modern software systems.

The retailing industry segment is projected to expand at a rapid pace. 3Pl providers are becoming essential for retailers as they are estimated to fulfill the demand rapidly. Giant companies like Amazon, DHL, and others have implemented a one- to two-hour shipping system in some large cities. As a result, service providers have a great opportunity to grow owing to retailers' plans. In order to provide the desired product to end customers, the manufacturing logistic support industry depends on logistical services, including the purchase of raw materials. 

Asia Pacific is estimated to expand at a significant growth rate

On the basis of regions, the 3PL software market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Asia Pacific is estimated to dominate the market during the projected period. Presence of large number of logistics and retail companies and rapid technological advancement in China is estimated to drive the market in the region. Moreover, China holds around 35% of the total revenue of the region. Companies in the e-commerce sector integrating warehouse projects and their solutions into supply chains have contributed to the market growth in the region. Rising need for cost savings and supply chain operations in the region are expected to fuel the market.

The 3PL software market in North America is anticipated to expand at a high CAGR during the projected period owing to the growth of the market in countries such as the US and Canada and the advent of highly developed IT industries. Regional market growth is attributed to increasing collaboration amongst top logistics service providers to include new projects. 3PL software market has expanded positively in this region as a result of the quick development of cloud-based solutions, influx of IoT technologies, and existence of several leading players in the region.

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Segments

The global 3PL software market has been segmented on the basis of
Mode of Transport

• 3PL Software for Railways
• 3PL Software for Airways
• 3PL Software for Roadways
• 3PL Software for Waterways

Service Types

• Dedicated Contract Carriage (DCC)
• Warehousing & Distribution
• International Transportation Management
• Domestic Transportation Management
• Others

Industry

• Healthcare Industry
• Food & Groceries Industry
• Elements Industry
• Retailing Industry
• Automotive Industry
• Technological Industry
• Others

Regions

• Asia Pacific
• North America
• Latin America
• Europe
• Middle East & Africa

Key Players

• United Parcel Service
• Union Pacific Railroad
• Magaya Corporation
• Panalpina World Transport Ltd.
• Golden Egg Solutions
• Nippon Express
• Maersk
• Shipbob, Inc.
• KUEHNE+AGEL Inc.
• Shiphero LLC
• FedEx Corporation
• DHL International GMBH
• Highjump
• ShipMonk
• DB Schenker
• C.H. Robinson Worldwide, Inc.
• Silver Bullet Technologies, LLC
• 3PL Central LLC
• Camelot 3PL Software
• Channelape Inc.
• Stockiq Technologies, Inc.

Competitive Landscape

Leading companies competing in the 3PL software market include United Parcel Service; Union Pacific Railroad; Magaya Corporation; Panalpina World Transport Ltd.; Golden Egg Solutions; Nippon Express; Maersk; Shipbob, Inc.; KUEHNE+AGEL Inc.; Shiphero LLC; FedEx Corporation; DHL International GMBH; Highjump; ShipMonk; DB Schenker; C.H. Robinson Worldwide, Inc.; Silver Bullet Technologies, LLC; 3PL Central LLC; Camelot 3PL Software; Channelape Inc.; and Stockiq Technologies, Inc. The market research report on 3PL software covers a complete market share analysis by focusing on various key strategies, market dynamics, industry trends, and business development methods adopted by the leading nutritional yeast manufacturer to ensure their presence in the global competition. It also provides qualitative and quantitative analysis and market size from the year 2021 to 2030. Some of the strategies include product launches, acquisitions or mergers, partnerships or collaborations, and expansion of production units. For instance,

• In November 2021, Golden Egg Solutions was acquired by Shiphero. Due to the acquisition, ShipHero now has a well-located warehouse in the northwest of the country that its fulfillment and 3PL clients can use.
• In December 2021, 3PL Central acquired CIO Technologies. During the acquisition of CIO Technologies by 3PL Central, many of the firm's products, including CartRover, were also acquired. The newest product in the 3PL Central series, CartRover, brings integration experience to enable smooth data flow from external commerce engines.
• In January 2022, Ruby Has Fulfillment was acquired by ShipMonk. With the acquisition, ShipMonk will be able to expand its operations both domestically in the United States and abroad in Canada and the United Kingdom, hence enhancing its corporate fulfillment opportunities to satisfy the demands of the expanding direct-to-consumer (DTC) brands.