European Logistics Industry Warms Up for Logistics Outsourcing Wave, IDC Says

AMSTERDAM – JULY 18, 2001- According to IDC, leading and emerging players in the European logistics services market are expanding their outsourcing capabilities in order to capitalize on the growing demand for full-service logistics outsourcing. IDC forecasts the total European market for logistics services, including transportation, to grow at a modest compound annual growth rate (CAGR) of 3.3% in the next five years to reach $613 billion in 2005. Within this market, logistics business process outsourcing is a high-growth segment, projected to expand at a CAGR of 13.1% to reach $53.9 billion in 2005. The increasing focus on core competencies, globalization and the growth of ecommerce and technology requirements are driving this growth.


The larger logistics service providers in Europe are increasingly looking to move up the value chain by providing end-to-end supply chain management services rather than centuries old discrete services in the areas of post, transportation, freight forwarding and warehousing. As part of the study, IDC interviewed and profiled seven major logistics service providers in Europe and found that most of these players are trying to position or reposition themselves as ‘lead logistics service providers’ (LLPs). LLPs have the expertise and capabilities to manage an entire supply chain process by integrating internal resources with those of clients, suppliers and third parties, typically through the use of information and communication technology, including the Internet. Profiled players such as Danzas (from Deutsche Post), Exel and TNT Logistics are expanding their portfolio with value-added services such as order and payment management, procurement and supplier management, call center management and consulting in order to better position themselves as LLPs.

According to Mélanie Dubois, senior analyst for IDC’s European eLogistics Services program, the logistics services industry in Europe is in a state of technology transformation. "Until recently, the transportation and logistics market in Europe could be described as a highly fragmented market that has been technology averse. Now we start to see strong consolidation in the region and new entrants as well as established players investing heavily in web-enabled technology. On the demand side we see multinational companies move their logistics processes from national to pan-European, looking for players that can help them manage supply chains in an integrated manner. These developments create new opportunities for innovative players."

The rise of eCommerce in Western Europe is another driving factor. Companies have become aware that good logistics and fulfillment are the bedrock of successful eCommerce. As a direct result of the growth of eCommerce, new efulfillment companies have emerged that are specifically servicing online traders. "But as this study illustrates, also leading and established players are moving into this area," Dubois concluded.

Moving Up the Value Chain – Logistics BPO European Market Overview, Forecast and Analysis, 2000-2005 (IDC #RG01H) gives an overview, forecast, and analysis of the European logistics business process outsourcing (BPO) market and profiles seven leading players in this industry, including Danzas (from Deutsche Post), Exel, TNT, Tibbett & Britten. Christian Salvesen, Kuehne & Nagel and Stinnes. Readers of this report will gain a strong understanding of the logistics BPO market in Western Europe, the major players, and the emerging market opportunities. This report is available to purchase from your local IDC office.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at

IDC is a division of IDG, the world's leading IT media, research and exposition company.


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