The freight forwarding industry plays a crucial role in the global supply chain by facilitating the movement of goods from one location to another. Freight forwarders are responsible for organizing the transportation and logistics of goods on behalf of their customers. They negotiate contracts with carriers, handle customs documentation, and ensure that goods are delivered safely and efficiently.
The global Freight Forwarding Market is estimated to be valued at US$ 204.6 Bn in 2019 and is expected to exhibit a CAGR of 5.0% over the forecast period 2021-2028, as highlighted in a new report published by Coherent Market Insights.
Freight forwarding services are widely utilized in various industries such as manufacturing, automotive, retail, and pharmaceuticals. With the increasing globalization and international trade, the demand for freight forwarding services is expected to escalate in the coming years. Additionally, the rise of e-commerce platforms and the increasing trend of online shopping have further fueled the growth of the freight forwarding market.
1. Driver: Increasing International Trade
One of the key drivers for the growth of the freight forwarding market is the increasing international trade. With globalization, businesses have expanded their operations to international markets, leading to a surge in the demand for cross-border transportation of goods. Freight forwarders play a crucial role in facilitating trade between countries by providing efficient transportation and logistics services. They ensure that goods are delivered on time and in compliance with international trade regulations, thus driving the growth of the market.
For example, the trade war between the U.S. and China has led to a shift in global supply chains, with manufacturers seeking alternative sourcing destinations. This has resulted in increased demand for freight forwarding services to transport goods from new manufacturing hubs to global markets.
2. Opportunity: E-commerce Boom
The rapid growth of the e-commerce industry has created significant opportunities for the Freight Forwarding Market Growth With the rise of online shopping, there has been a surge in the demand for efficient and timely delivery of goods. E-commerce companies rely heavily on freight forwarders to handle their logistics and transportation needs, ensuring that products reach customers in a timely manner.
The COVID-19 pandemic further accelerated the growth of e-commerce, as consumers turned to online shopping due to social distancing measures. This has created a favorable environment for the freight forwarding market, as the industry continues to witness increased demand for transporting goods from warehouses to customer doorsteps.
The freight forwarding market can be segmented based on services, mode of transport, and end-user industries. One of the dominating segments in the market is the air freight forwarding segment. Air transport offers several advantages such as faster transit times, lower inventory carrying costs, and higher reliability, which makes it the preferred choice for time-sensitive and perishable goods.
– Political: The political landscape plays a significant role in shaping the freight forwarding market. Trade agreements, customs regulations, and political stability in different countries have a direct impact on the flow of goods and the demand for freight forwarding services.
– Economic: Economic factors such as GDP growth, inflation rates, and exchange rates influence the demand for logistics services. Countries with robust economic growth and favorable business environments are likely to witness higher demand for freight forwarding services.
– Social: Changing consumer behavior, urbanization, and population growth impact the demand for goods and, consequently, the need for efficient logistics services. The rise of e-commerce and online shopping is a key social factor driving the growth of the freight forwarding market.
– Technological: Technological advancements such as automation, artificial intelligence, and blockchain are transforming the freight forwarding industry. These technologies enable greater visibility and transparency in the supply chain, enhancing operational efficiency and customer experience.
– The global freight forwarding market is expected to witness high growth, exhibiting a CAGR of 5.0% over the forecast period, due to increasing international trade and the booming e-commerce industry.
– Asia-Pacific is anticipated to be the fastest-growing and dominating region in the freight forwarding market, driven by rising trade activities, manufacturing hubs, and robust economic growth.
– Key players operating in the global freight forwarding market include Agility, Bolloré Logistics, CEVA Logistics, DB Schenker, DHL Global Forwarding, Dimerco, DSV Panalpina A/S, Expeditors International, Hellmann Worldwide Logistics, Kuehne + Nagel International AG, MGF (Manitoulin Global Forwarding), Nippon Express Co., Ltd., and UPS Supply Chain Solutions. These players focus on strategic partnerships, technological advancements, and expansion into emerging markets to gain a competitive edge.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it