Freight Forwarding Market Size, Share & Trends Analysis Report By Mode of Transport (Road, Maritime, Rail, Air), By Customer Type (B2B, B2C), By Service, By Application, By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global freight forwarding market size was valued at USD 200.98 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 4.6% from 2023 to 2030. Globalization has played a central role in propelling the growth of the market. As businesses increasingly expand their operations beyond their domestic borders and engage in international trade, the demand for efficient and dependable freight forwarding services has experienced a substantial upswing. This surge in demand is primarily attributed to companies actively sourcing raw materials, components, and finished products from various countries while simultaneously selling their goods to a global customer base. This global expansion and integration of business activities necessitate the specialized knowledge and services freight forwarders offer to manage the intricate logistics inherent in global trade effectively.

As businesses venture into the global marketplace, they encounter many logistical challenges and complexities. These complexities stem from varying regulations, customs procedures, transport modes, and geographic distances in international commerce. To navigate these challenges successfully, companies require the expertise and support of freight forwarders who understand the intricacies of international logistics. Freight forwarders serve as intermediaries between businesses and the various entities involved in transporting and delivering goods, including shipping lines, airlines, trucking companies, customs authorities, and more.

The rapid expansion of e-commerce has also profoundly impacted the market's growth. Online retail and digital marketplaces have experienced significant growth as consumers increasingly prefer to shop online, transforming how products are sourced and sold. This shift towards digital commerce often involves international trade, which presents intricate supply chain logistics challenges that are met by freight forwarders. Online retailers and e-commerce platforms rely heavily on freight forwarders to efficiently move goods from manufacturers, often located in different countries, to consumers spread across the globe. This reliance on specialized logistics companies has become a hallmark of the e-commerce supply chain.

Online retail businesses acquire goods from a worldwide network of manufacturers to provide customers with various products. Freight forwarding holds a pivotal position in orchestrating the movement of these goods, guaranteeing their smooth transition from the manufacturer's base to the online retail firm's distribution hubs or storage facilities. This entails managing the intricate aspects of international shipping, customs processes, and legal requirements, which can significantly differ between countries.

In addition, online retail firms often need to disseminate products to customers across the globe, necessitating a sophisticated approach to worldwide supply chain management. Freight forwarding is an indispensable collaborator in devising transportation routes, opting for the most suitable modes of transport (whether by air, sea, or land), and overseeing the freight forwarding processes necessary for delivering goods to customers' residences. They possess the necessary expertise to navigate the complexities of international trade and guarantee the timely and efficient movement of merchandise.

COVID-19 Impact

The freight forwarding industry experienced significant impacts from the COVID-19 pandemic, affecting immediate operations and potentially influencing longer-term trends. One of the most immediate and noteworthy outcomes was the disruption of global supply chains. Measures like lockdowns, factory closures, and movement restrictions disrupted the worldwide flow of goods, creating substantial challenges for professionals in freight forwarding. They had to swiftly adjust and find alternative routes and modes of transportation to maintain cargo movement, frequently encountering unexpected delays and congestion.

In addition, the pandemic triggered a notable change in the demand for various commodities. There was a surge in demand for essential items such as medical supplies and personal protective equipment (PPE). In contrast, the demand for non-essential goods such as fashion and luxury items declined. Freight forwarders needed to be agile in modifying their service offerings to accommodate these shifts in demand, sometimes necessitating the reconfiguration of capacity and resources.

Capacity constraints also became a significant challenge during the pandemic. Airlines canceled flights, and shipping lines reduced sailings, leading to a scarcity of available transportation capacity in both air and ocean freight. This supply-demand imbalance resulted in increased freight rates and difficulties in securing space for cargo, further complicating the logistics landscape. The pandemic's health and safety measures, such as social distancing and sanitation protocols, had a noticeable impact on cargo handling processes at ports and logistics facilities. These measures slowed down operations, leading to delays in the movement of goods. Delays and disruptions not only added costs but also strained supply chains, making it essential for freight forwarders to adapt and find ways to mitigate these challenges.

Mode of Transport Insights

Based on mode of transport, the market is classified into road, maritime, rail, and air. The road segment dominated with a revenue share of 50.2% in 2022 and is expected to witness a CAGR of 4.4% during the forecast period. One of the primary factors contributing to the ubiquity of road transportation is its adaptability and accessibility. Road transportation can access a wide range of locations, even reaching remote areas where alternative modes might not be as feasible. This accessibility makes it the preferred choice for conveying goods to diverse destinations, thus serving a broad clientele. Furthermore, cost-efficiency has played a pivotal role in propelling the expansion of road transport. In numerous instances, road transport is more economically efficient for short to medium-distance shipments than rail or air transport. This cost-related advantage has rendered road transport an appealing alternative for regional and local deliveries, particularly in scenarios where punctual and cost-effective delivery is paramount.

The air transport segment is anticipated to witness the fastest CAGR of 5.6% throughout the forecast period. Several prevailing trends and factors contribute to the surge in this segment. Foremost, the ongoing globalization of supply chains has considerably fueled the demand for air transportation. As businesses extend their operations worldwide, the necessity for expeditious and efficient cargo conveyance has intensified. Due to its unparalleled swiftness, air transportation has emerged as the favored choice for enterprises dealing with high-value and time-sensitive commodities. Furthermore, the thriving e-commerce sector has played a pivotal role in propelling air freight growth. In particular, online retailers heavily depend on air transportation to satisfy customer expectations for prompt deliveries. This has resulted in heightened utilization of air cargo services, especially for compact parcels and high-demand products. The ability to deliver merchandise swiftly and reliably has evolved into a pivotal competitive advantage within the e-commerce industry.

Customer Type Insights

Based on customer type, the market is classified into B2B and B2C. The B2B segment dominated in 2022, gaining a revenue share of 55.4%. It is expected to witness a CAGR of 4.3% during the forecast period.Technology integration has been instrumental in driving the growth of the B2B segment. B2B customers are actively seeking technology-driven solutions to enhance supply chain visibility and control. This includes the adoption of transportation management systems (TMS), real-time tracking, and advanced analytics tools to optimize routes, reduce costs, and improve overall efficiency. Sustainability and green freight forwarders have become paramount concerns for B2B customers. Environmental considerations and regulatory pressure are pushing these customers to seek freight providers that offer sustainable transportation options. This may involve carbon-neutral shipping, electric or alternative-fuel vehicles, and the implementation of more eco-friendly supply chain practices.

The B2C segment is anticipated to observe a significant CAGR of 5.0% throughout the forecast period. The growth of the Business-to-Consumer (B2C) segment has been a significant and transformative trend in recent years. Consumer behavior has shifted substantially recently, with many expecting quick and convenient delivery options. This change has put immense pressure on freight forwarding companies to adapt and offer services tailored to the B2C market. For instance, customers increasingly demand same-day or next-day delivery options, pushing freight forwarding providers to streamline their operations and enhance delivery speed and reliability. Urbanization has played a pivotal role in the growth of the B2C segment. The concentration of populations in urban areas has created dense delivery networks, making it more cost-effective for freight forwarding companies to serve individual consumers in these regions. This urbanization trend has also led to the proliferation of micro-fulfillment centers and innovative delivery solutions designed to navigate urban landscapes efficiently.

Service Insights

Based on service, the market is classified into transportation & warehousing, value-added services, packaging, and others. The transportation & warehousing segment dominated in 2022 with a revenue share of 30.0% and is expected to witness a CAGR of 4.9% during the forecast period. The rapid growth of e-commerce has been a major driver for the transportation and warehousing segment. Online retailers require efficient freight forwarding solutions to manage inventory, order fulfillment, and ensure timely customer delivery. This has increased demand for transportation and warehousing services to support the e-commerce supply chain. Moreover, last-mile delivery is a critical aspect of e-commerce freight forwarding, and companies are increasingly investing in innovative solutions to optimize this final leg of the delivery process. This has created opportunities for transportation companies specializing in last-mile delivery services.

The value-added service segment is anticipated to witness the fastest CAGR of 5.3% throughout the forecast period. A key factor contributing to the growth is the integration of advanced technologies into freight forwarding operations. Technologies like the Internet of Things (IoT), artificial intelligence (AI), and blockchain have empowered freight forwarding providers to offer value-added services like real-time tracking, predictive analytics, and supply chain visibility. These services enhance efficiency, transparency, and decision-making within the supply chain. The customization and personalization of freight forwarding services have also become a prominent trend. Customers increasingly expect tailored freight forwarding solutions to meet their specific requirements. Freight forwarding companies have responded by offering customized services, including temperature-controlled transportation, product assembly, and kitting services, allowing them to cater to diverse client needs.

Application Industry Insights

Based on application industry, the market is classified into retail & e-commerce, healthcare, food & beverages, media & entertainment, industrial & manufacturing, oil & gas, and others. The industrial and manufacturing segment dominated attaining a revenue share of 21.8% in 2022 and is expected to grow at a CAGR of 5.4% during the forecast period. The expansion of the segment is influenced by various distinctive trends and factors shaping its progression. One pivotal driver behind this growth is the escalating complexity of global supply chains within these sectors.

Industrial and manufacturing companies frequently operate globally, necessitating efficient freight forwarding solutions to oversee the procurement of raw materials, navigate the intricacies of production processes, and distribute finished products to diverse markets. In addition, the adoption of Just-in-Time (JIT) manufacturing practices has significantly contributed to the growth of this segment. Manufacturers increasingly embrace JIT principles to minimize the costs associated with holding inventory. This approach hinges on the punctual and precise delivery of raw materials and components, which, in turn, places substantial demands on freight forwarding services to guarantee a smooth and timely transportation process.

The retail & e-commerce segment is anticipated to observe a significant CAGR of 5.8% throughout the forecast period. The growth is influenced by several specific factors that mirror the distinctive demands and challenges businesses encounter. One of the most prominent catalysts behind this growth has been the remarkable surge in e-commerce platforms. With consumers increasingly gravitating towards online shopping for convenience and product variety, retailers and e-commerce firms face tremendous pressure to devise effective and adaptable freight forwarding solutions to cater to the surging demand for their offerings. The last-mile delivery segment has grown substantially in response to this heightened demand. The last mile, which encompasses the final stage of delivering goods to the customer, has become a pivotal focal point within retail and e-commerce freight forwarding. Companies invest significantly in technology and strategic partnerships to enhance their last-mile freight forwarding, delivery speed, and customer satisfaction.

Regional Insights

Asia Pacific led the overall market in 2022, with a revenue share of 31.5% in 2022. Urbanization and infrastructure development have been instrumental in reshaping the freight-forwarding landscape across the region. The swift pace of urbanization has prompted substantial investments in modern transportation networks, freight forwarding centers, and technologically advanced warehouses, all of which have contributed to enhancing the efficiency and competitiveness of the freight forwarding industry. Furthermore, the expansion of cross-border trade has played a pivotal role in propelling this growth. Countries within the Asia Pacific have been actively involved in cross-border trade facilitated by various trade agreements and economic alliances. Notably, China's Belt and Road Initiative has significantly bolstered trade connectivity, resulting in a heightened demand for cross-border freight forwarding services.

Europe is anticipated to observe a significant CAGR of 5.7% throughout the forecast period. Intermodal transport has gained prominence in European freight forwarding. This approach involves using multiple modes of transportation, such as road, rail, sea, and air, to move goods efficiently. It offers cost savings, reduces environmental impact, and enhances overall freight forwarding efficiency, making it an attractive option for companies seeking to optimize their supply chains. The emergence of digital freight marketplaces and platforms has streamlined the freight forwarding process. These platforms connect shippers and carriers more efficiently, often employing algorithms to match cargo with available transport capacity. Digitalizing freight forwarding operations enhances transparency, reduces friction, and improves customer experience.

Key Companies & Market Share Insights

The market is anticipated to witness competition due to presence of the several players. In June 2023, Kuehne+Nagel agreed to purchase Morgan Cargo, a freight forwarding company based in South Africa, the UK, and Kenya, with expertise in the transportation and management of perishable goods. This acquisition enhances Kuehne+Nagel's range of services in perishable freight forwarding and strengthens the connections available to customers traveling to and from South Africa, the UK, and Kenya, including access to advanced cold chain facilities. Some prominent players in the globalfreight forwarding market include:

• Kuehne+Nagel

• Deutsche Post AG

• DB Schenker

• Expeditors International of Washington, Inc.

• CEVA Freight forwarding

• DSV

• FedEx

• Uber Technologies, Inc.

• United Parcel Service of America, Inc.

• NIPPON EXPRESS HOLDINGS

Freight Forwarding Market Report Scope

Global Freight Forwarding Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2017 to 2030. For this report, Grand View Research has segmented the global freight forwarding market report based on mode of transport, customer type, service, application, and region:

• Mode of Transport Outlook (Revenue, USD Million, 2017 - 2030)

  • Road

  • Maritime

  • Rail

  • Air

• Customer Type Outlook (Revenue, USD Million, 2017 - 2030)

  • B2B

  • B2C

• Service Outlook (Revenue, USD Million, 2017 - 2030)

  • Transportation & Warehousing

  • Value-added Services

  • Packaging

  • Others

• Application Outlook (Revenue, USD Million, 2017 - 2030)

  • Retail & E-commerce

  • Healthcare

  • Food & Beverages

  • Media & Entertainment

  • Industrial & Manufacturing

  • Oil & Gas

  • Others

• Regional Outlook (Revenue, USD Million, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • U.K.

    • France

  • Asia-Pacific

    • China

    • India

    • Japan

    • South Korea

    • Australia

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa

    • KSA

    • UAE

    • South Africa