newsworthy
U.S. 3PLs showed below-trend growth in 2012
U.S.-based third-party logistics service providers (3PLs)
posted 2012 gross revenues—revenues before the cost of
purchased transportation—of $141.8 billion, a 6-percent
increase over 2011 results, according to an annual report
issued May 21 by Armstrong & Associates Inc.
That figure is almost identical to the 5.9-percent
increase in 2011 over 2010 totals. However, it is significantly below the industry’s long-term growth rate, according to the Stoughton, Wis.-based consulting company’s
data. From 1996 through 2012, the 3PL market grew at a
10-percent annual compounded rate, Armstrong said.
The firm forecast that 2013’s results would be roughly in
line with last year’s. The company said global economic
uncertainty and the hit from sequestration will dampen
U.S. economic activity and, by extension, 3PL revenues.
WEAKNESS OVERSEAS
Armstrong said the 2012 results mirrored a subpar U.S.
economic recovery, pronounced weakness in Europe, and
modest growth in Asia. Perhaps unsurprisingly, results for
“international transport management” came in the weakest of the four main categories tracked by Armstrong.
Profit margins for the category fell 4. 1 percent year over
year, while gross revenue and net revenue, which include
transportation costs, rose by very small amounts.
Another category, “value-added warehousing and distribution,” reported a 3.3-percent year-over-year drop in
margins, although gross and net revenues were stronger
than in the international transport management category,
according to the data. Richard Armstrong, the firm’s
chairman, attributed the slack numbers to the combination of anemic U.S. gross domestic product (GDP) growth
and rising transportation costs hitting 3PLs that offer
warehousing and distribution services.
“Domestic transportation management” services
showed a 9.2-percent increase in gross revenues over 2011,
according to the report. However, net revenues were up
only 5. 4 percent as slower demand, increased competition,
and increased transportation costs put pressure on the
category. “Dedicated contract carriage,” the smallest revenue generator of the four main categories, posted year-over-year gains in gross and net revenues of 4. 5 percent
and 4. 7 percent, respectively.
Domestic transport management and dedicated carriage, which combined accounted for $47.4 billion of U.S.
3PL gross revenues, showed double-digit year-over-year
gains in profit margins, according to the Armstrong data.
The total 2012 gross revenue figure includes about $3
billion spent on contract logistics software, the firm said. ;
—M.S.
accolades
Supply chain service provider ModusLink Global Solutions
Inc. has received a Supplier Excellence Award from semiconductor designer AMD. … Crown Equipment Corp. has
won one of four International Forklift Truck of the Year
Awards, taking first-place honors in the
Forklift Truck Solutions category. The
company has also issued its own
awards, presenting Fallsway
Equipment Co. of Akron, Ohio, and
Crown Lift Trucks of Salt Lake City,
Utah/Boise, Idaho, with the James F.
Dicke Pioneer Award as the company’s
top-performing dealer and branch, respectively. …
Southeastern Freight Lines, a provider of regional less-than-truckload transportation service, has been named
Lowe’s Platinum Carrier of the Year, the highest award
given out by the home improvement retailer. … For the
second year in a row, warehouse automation specialist
Numina Group has been awarded the TGW Integrator
Sales Award, reserved for top-tier integrators. … RGL, a
logistics company based in Green Bay, Wis., was awarded
CROWN
the 2012 Corporate Safety Award by the Wisconsin Safety
Council and the Wisconsin Department of Workforce
Development. … Exel, part of the supply chain division of
the global logistics provider Deutsche Post DHL, has
received the U.S. Environmental Protection Agency’s 2012
WasteWise Small Business Partner of the Year award for
the sustainability program at its Lockport, N.Y., distribution center. … SmartDrive Systems, a provider of driving
performance solutions that reduce collisions and improve
fuel efficiency, has been selected as a finalist for Red
Herring’s Top 100 North America award for promising private technology ventures. … Michael Foods Inc., a
Minneapolis-based food processor and distributor, has
presented Cloverleaf Cold Storage’s Sioux City, Iowa, distribution center with an award for outstanding overall
performance. … Supply chain consulting firm Scott
Sheldon LLC has been recognized as one of the Top 100
privately held businesses in Ohio. … Banneker Industries,
a provider of third-party logistics services, was selected as
the 2013 Supplier of the Year by the Greater New England
Minority Supplier Development Council.
