Freight Packing and Logistics Services in the US Industry Market Research Report Now Available from IBISWorld

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While revenue dropped during the Great Recession, the Freight Packing and Logistics Services industry's performance has started to improve, as freight transportation activity and demand from trade have returned to growth. In 2009, declining demand caused greater price competition among operators. Demand improved in late 2010 and is expected to continue rising through 2012, causing revenue to grow 2.1% over 2012. Over the five years to 2017, revenue is expected to return to steady growth. Increased freight volumes, a rebound in international trade and higher trucking and rail activity will support this growth. However, the industry will likely face increasing pressure over the next five years.

IBISWorld Market Research

IBISWorld Market Research

Trucking and rail activity will revive and trade will pick up, driving demand

While revenue dropped during the Great Recession, the Freight Packing and Logistics Services industry's performance has started to improve, as freight transportation activity and demand from trade have returned to growth. The industry performed particularly poorly in 2009, when revenue fell 14.5% due to sharp declines in freight volumes and trade. According to IBISWorld industry analyst Lauren Setar, “The global economic downturn depressed trade, reducing the number of products that needed to be shipped.” Declining demand caused greater price competition among operators. Demand improved in late 2010 and is expected to continue rising through 2012, causing revenue to grow 2.1% over 2012. However, this limited growth has kept industry revenue below pre-recession levels, with an average annual decline of 2.2% to $1.7 billion over the five years to 2012.

Despite stronger growth in demand, the number of establishments is expected to decline at an average annual rate of 0.7% in the five years to 2012, as many firms continue to recover from the recession's negative effects. Consolidation and increased external competition have forced many operators out of the industry. The industry employs a flexible labor force; employers hire new staff to meet increased demand and then shed workers in difficult years. Setar says, “In 2009, falling demand caused a particularly significant decrease in employment and wages.” Over the five years to 2012, industry employment and wages are estimated to fall at average annual rates of 1.0% and 2.6%, respectively. The industry has a low level of concentration, mostly including small players that service specific regions or market sectors. However, one major player, Brambles, operates in the industry through its US freight packing and logistics services segment, CHEP.

Over the five years to 2017, revenue is expected to return to steady growth. Increased freight volumes, a rebound in international trade and higher trucking and rail activity will support this growth. However, the industry will likely face increasing pressure over the next five years as integrated logistic networks continue to grow, major transport operators bring more auxiliary transport activities in-house and greater use of digital technology reduces demand for some services.

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This industry's main activity is providing packing and crating services for the transport sector. The industry comprises companies that provide consolidation of freight consignments, trade document preparation, packing, crating and otherwise preparing goods for transportation, and logistics consulting services. The industry does not include actual transportation of goods.

IBISWorld industry Report Key Topics

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

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Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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