Process, Distribution & Logistics Consulting

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 7,000 process, distribution, and logistics consulting services providers in the US include a broad range of specialties, including manufacturing operations improvement; productivity improvement; production planning and control; quality assurance and quality control; inventory management; distribution networks; warehouse use, operations, and utilization; transportation and shipment of goods and materials; and materials management and handling. Firms may offer multiple services or specialize in a particular area.

Dependence on Skilled Labor

Despite a dependence on technology, the process, logistics, and supply chain consulting industry remains labor-intensive and reliant on skilled workers.

Competition from Alternative Service Providers

Process, distribution, and logistics consultants compete with a variety of alternative service providers, including accounting firms, management consultants, IT service providers, and transportation companies.

Industry size & Structure

The average process, distribution and logistics consulting services provider employs about 18-19 workers and generates over $2 million annually.

    • The process, distribution and logistics consulting industry consists of about 7,000 firms that employ about 133,000 workers and generate $16 billion annually.
    • The industry is fragmented; the top 50 companies account for almost 33% of industry revenue.
    • Large firms that offer process, distribution and logistics consulting services, which include C.H. Robinson and XPO Logistics, have a global presence.
                              Industry Forecast
                              Process, Distribution & Logistics Consulting Industry Growth
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              Mar 2, 2023 - US Manufacturing Activity Contracts
                              • US manufacturing activity - a demand indicator for process, distribution, and logistics consulting services - contracted in February 2022 for the fourth consecutive month, according to the Institute for Supply Management (ISM). The ISM’s Purchasing Managers Index (PMI) in February rose to 47.7%, up from 47.4% in January. A reading above 50% indicates manufacturing expansion. February’s New Orders Index rose 4.5 percentage points to 47%. The February Production Index fell 0.7 percentage points to 47.3%. Of the 18 manufacturing industries tracked by the ISM, only four reported growth in February: apparel, leather & allied products; transportation equipment; petroleum & coal products; and electrical equipment, appliances & components. Sectors reporting some of the most significant contractions in February included: printing & related support activities; paper products; wood products; textile mills; furniture products; nonmetallic mineral products; plastic & rubber products; food, beverage & tobacco products; chemical products; and primary metals.
                              • A group of nine major ocean shippers recently announced a timeline for transitioning from paper bills of lading to electronic ones, according to Supply Chain Dive. The Digital Container Shipping Association said its members, which include major shipping firms A.P. Moller – Maersk and MSC, would convert half of their original bills of lading to electronic within five years. The carriers will convert to all digital by 2030. During the pandemic, shipping containers became stranded in ports because flights carrying lading documents to release the containers were canceled. McKinsey estimates that converting to digital bills of lading could save stakeholders $6.5 billion and enable an additional $40 billion in global trade.
                              • According to a recent survey of procurement and sourcing professionals by sourcing automation firm Keelvar, inflation is affecting 91% of companies. In addition to inflation, the war in Ukraine and the possibility of recession pose significant headwinds. More than 80% of respondents said that overcoming supply chain disruptions was their top priority, and 78% reported that managing rising costs was their leading concern. Other pressing issues included market volatility (74% of respondents) and managing geopolitical risks (71%). Procurement professionals are navigating their supply chain challenges through a variety of means, including using more sustainable suppliers (54% of respondents), diversifying their supplier base (52%), nearshoring (49%), and modernizing sourcing technology (39%).
                              • Shippers will continue to diversify their carrier mix to include more competitors of UPS and FedEx in 2023, according to Supply Chain Dive. During the pandemic, diversifying last-mile delivery needs to include smaller, regional carriers was a familiar strategy shippers used to speed service when FedEx and UPS were operating at full capacity. In December, the average number of last-mile carriers used per shipping firm rose to 5.73 from 4.86 a year earlier, according to logistics technology firm project44. Several factors are contributing to the trend of shippers using a more diverse roster of carriers, including rising rates by top carriers, ongoing contract negotiations between UPS and the Teamsters, and service improvements by smaller carriers.
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