THIRD PARTY COMPANIES IN LOGISTICS AND RISING GIANT IN INDUSTRIAL RACK MARKET : ASIA PASIFIC

Global Market Study on Industrial Racking Systems: Rapid Advancement of Third-party Logistics Augmenting Market Growth

First of all, it is useful to understand how these companies known as third parties and how they view their logistics business. These are logistics companies that take over the logistics activities of their customers (priority transportation and storage) and are experts in their fields. By the first party notification, the seller company is meant by the second party, the buyer company, and by the third party, the company that undertakes the other services between the seller and the buyer companies.

Changing technology landscape, macro-economic developments, and shifting consumer preferences are having a huge impact on the operations of warehouses and distribution centers, which is subsequently paving the way for significant expansion of the global industrial racking system market size. With the rapid growth of the logistics and transportation sector across the world, the global industrial racking system market is set to witness health growth at a CAGR of above 7% over the period of 2020 to 2030.

Industrial Racking System Market Trends

Growing 3PL Market to Augment Sales of Industrial Racking Systems: Logistics is one of the most important industries in any economy, as it deals with the management of the flow of products from the place of origin to the place of consumption, and thus, the industry also involves the integration of material handling, warehousing, packaging, transportation, inventory management, supply chain management, procurement, and shipping security aspects. Given the complexities involved across the entire chain, end-to-end solutions have emerged, such as third-party logistics (3PL), which take care of the entire gamut of such activities. The growth of dedicated third-party logistics service providers would immensely benefit the industrial racking system market, as efficient material handling systems are the cornerstone of success for such service providers.

Increasing Rural Consumption and Regional Policies Bolstering Growth Outlook: Catering to last-mile logistics in remote areas is a critical challenge for the logistics processes of all businesses. It is impossible for most businesses to reach each and every remote location. Thus, a dedicated logistics system is required to cater to the rapidly growing demand in such areas. Moreover, governments of various countries are implementing initiatives to improve connectivity and freight movement by upgrading infrastructure that links remote or rural areas to nearby major urban centers. These developments will also create a positive landscape for the industrial racking system market.

Shortage of Modern Warehousing Spaces Forcing New Build Along With High Demand for Industrial Racking Systems: Warehouse construction and demand for storage space is skyrocketing around the world. Furthermore, shortage of modern warehouse facilities will lead to tough competition for space among e-Commerce players, given the lack of modern warehouse space and rise of the e-Commerce industry, especially in developing countries. There is huge opportunity to develop new warehouses and rebuild old ones to ensure that they meet modern requirements. The industrial racking system market benefits from key drivers of economic activity, including consumption, e-Commerce, supply chain modernization, and urbanization. In developed markets of the U.S., Europe, and Japan, key factors are the reconfiguration of supply chains (strongly influenced by e-Commerce trends), whereas, in emerging markets such as Brazil, China, India, and Mexico, affluence and the rise of a new consumer class have increased the need for modern distribution networks

Manufacturers’ Focus: Investments in Logistics and Enhancing Supply Chain Networks: The global industrial racking system market is a highly competitive market space. Key market players are focusing on enhancing their market share by investing heavily in logistics and seeking possibilities to close value chains. Also, continuing efforts are being made to further improve the cost and performance parameters for different applications. Manufacturers in the industrial racking system market are focusing on expansion of their production and distribution networks in South Asia and Pacific, owing to the prevalence of low labor costs and large number of industrial manufacturers in the region.

Regional Outlook of Industrial Racking System Market

In terms of regional distribution, global demand for industrial racking systems is dominated by Asia Pacific, accounting for the single-largest chunk of the global industrial racking system market share in 2019. The region is projected to continue to be the most significant demand center for the industrial racking system market throughout the forecast period. The large-scale manufacturing hubs already present in East Asian countries of China, Japan, and South Korea, as well as upcoming new regional clusters in Southeast Asia and India, are key demand drivers for the industrial racking system market in this region.

Industrial Racking System Market: Highly Competitive Space

The industrial racking system market is fragmented on a moderate scale, with leading market players only occupying one-fourth of the market share. Attributing to the presence of number of global and regional players, the market witnesses fierce competition. Some of the key players in the global industrial racking system market are Stow International, Jungheinrich AG, Mecalux S.A., Kardex AG, and Daifuku Co. Ltd., amongst many others.