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 Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, 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

                              Coronavirus Update

                              Apr 15, 2022 - More Supply Chain Pain Expected
                              • Supply chain experts say that China’s strict Covid-control policy could cause renewed supply-chain disruptions in the US as shuttered factories there cause orders to back up. The effects of lockdowns in southern Chinese megacity Shenzhen — home to the nation’s most-important port after Shanghai — will affect the Los Angeles-area sea-cargo hubs, the busiest container gateway in the US, according to Noel Hacegaba, of the Port of Long Beach. Backups building at other ports in China may be indicate what's to come at Shenzhen, according to Alex Charvalias, of maritime-analytics firm MarineTraffic. The number of container vessels waiting to berth in the eastern city of Qingdao climbed to 22 from 9 in one week, he said, and the queue is also growing at the biggest port in Shanghai, he said. This will affect the US in the next month or so, because fewer vessels will leave for the West Coast, he added.
                              • Global air and sea freight routes have become more expensive and less reliable during the pandemic, according to maritime and supply chain intelligence company eeSea. Just 7% of sea shipments from Asia to North America arrived on time in March, while 6% were on time for the Asia-to-Europe route. Even big companies with bargaining power can expect to pay contract freight rates around five times higher than in 2019. Continuing Covid-19 lockdowns in China and coming wage negotiations with West Coast dockworkers in the US may intensify supply chain pain points in the near term.
                              • Imports at the nation’s major retail container ports are expected to be at near-record levels this spring and summer as consumer demand and supply chain challenges continue to result in congestion, according to the monthly Global Port Tracker report released today by the National Retail Federation and Hackett Associates. “Growth rates have slowed down from the off-the-charts numbers we saw last year, but volume is close to the highest we’ve ever seen," NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. "Everyone in the supply chain is trying to reduce congestion, but there is still work to be done. Retailers are also planning for potential additional disruptions this summer from West Coast port labor contract negotiations.”
                              • Some manufacturing industry experts suggest that supply chains be shorter to be more resilient. Complications due to reliance on foreign suppliers and lean inventory practices are leading many manufacturers to assess their operations, creating consulting opportunities. This, along with the increasing cost of imported goods, mainly from China, could lead manufacturers to reshuffle supply chains. Near 85% of procurement professionals at North American manufacturing firms are likely or extremely likely to reshore some of their supply chains, according to Thomas, a provider of supplier and product sourcing services. A substantial majority of survey respondents plan to reshore some operations despite some challenges in doing so, including price and speed.
                              • Third-party logistics (3PL) providers and shippers forged new relationships with last-mile transportation providers during the pandemic to help meet customer expectations for quick delivery times, according to a whitepaper by the Transportation Intermediaries Association (TIA) and the Customized Logistics & Delivery Association. Last-mile logistics services represent a key service offering expansion opportunity for players in the 3PL space. Key trends driving last-mile demand include the continued growth of consumer e-commerce, time-sensitive handling and delivery of medical supplies (including vaccines), and B2B order fulfillment. In the third quarter of 2021, e-commerce sales accounted for 12.4% of total US retail sales, down slightly from 13.1% in Q3 2020, according to the US Census Bureau.
                              • The Biden administration announced a policy shift aimed at easing the bottlenecks at US ports, according to The Wall Street Journal. Under the program, ports will be able to redirect money from other federally funded projects and use the funding to help move cargo through ports more quickly.
                              • Some firms that saw their supply chains repeatedly disrupted during the pandemic may make mid-to-long-term technology investments that enable greater transparency and adaptability into their global supply chains. According to a recent study by Accenture, 88% of C-suite executives believe supply chain issues will continue to push prices higher, reducing consumer spending. About a third of corporate leaders believe supply woes could persist for up to three years. According to Accenture, executives’ leading reactions to supply chain problems included, ordering early (43% of executives), creating contingency plans (43%), and restructuring supply chains and inventory management systems (42%). However, firms are expected to make more investments in cloud-based data analytics tools that provide new transparency into logistics operations. The combination of automation, artificial intelligence (AI), and robotics can reveal vulnerabilities and spur preemptive action, such as switching suppliers. Nearly 80% of executives said the pandemic’s effect on supply chains is likely to drive increased use of automation, AI, and robotics to improve visibility.
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