Milwaukee, WI, February 1, 2018 –Armstrong & Associates, Inc. (A&A) www.3PLogistics.com estimates the total U.S. warehousing market for 2017 was $148.7 billion. Commercial warehousing accounted for $68.6 billion. The Third-Party Logistics (3PL) Value-Added Warehousing and Distribution (VAWD) market segment was $39.1 billion in 2016 and is estimated at $40.5 billion for 2017.

To track the most up-to-date costs, pricing, and practices in North American warehousing, A&A collected information from over 500 contract warehousing operations, almost 400 contract customers, and 100 public warehousing operations. The results are published in a report released today, “First Wave Pick: The Business of Warehousing in North America – 2018, Market Size, Major 3PLs, Benchmarking Costs, Prices and Practices.” The report is the latest in A&A’s series of Warehousing studies, which have been instrumental resources to the industry for over 15 years. In addition to market estimates, warehousing operators and customers of third-party logistics providers (3PLs) will find extensive guidelines for pricing, including e-commerce rates. “First Wave Pick” also includes a list of A&A’s Top 50 North American VAWD 3PLs, capability and technology benchmarks, contract length data, and market rental and vacancy rates.

Top 50 North American VAWD 3PLs
A&A’s Top 50 North American VAWD 3PL list—representing 3,827 facilities and 829 million square feet of warehousing space—includes data on leading 3PLs, including number of warehouses, total space, warehouse and value-added service capabilities, and warehouse management system (WMS) deployment. A&A estimates that there are 9,000 U.S. commercial warehousing facilities of size with 1.9 billion square feet of space. The Top 50 have an average of 77 warehouses. The average size is 216,593 square feet.

Benchmarking Costs and Prices
Operating margins, both expected and actual, have fallen since A&A’s previous studies. Market competition and customer sophistication are two driving forces. Pricing, especially in light of scope creep, is always a challenge. A&A’s Transactional Pricing Guidelines, included in the report, are guidelines for handling charges, storage per month by number of turns, rates for pallets high/deep, costs per square foot, racking costs, inventory turn discounts, per-hour labor rates, and transactional charges. Operating margin benchmarks are also provided. Benchmarks are split, where applicable, by warehouse type (contract, VAWD 3PL, or public), size, and commodities handled.

E-commerce
North American e-commerce logistics revenues were $9.5 billion in 2016, and A&A anticipates that number will double by 2020. E-commerce is changing the landscape of 3PL warehousing, amplifying the effects of nearly every major trend—a tight labor market, adoption of new technologies, increased rents, low vacancy rates, increasing capacity, and new development. In addition to e-commerce logistics costs, 3PL revenue, and growth rates, “First Wave Pick” includes, for the first time, e-commerce fulfillment benchmark rates.

This market size and benchmarking data is only available from A&A, and will be a valuable desktop reference. The complete report and other A&A research can be found at: http://www.3plogistics.com/product-category/guides-market-research-reports/market-research-reports/.

ABOUT ARMSTRONG & ASSOCIATES, INC.

Armstrong & Associates, Inc. (A&A) was established in 1980 to meet the needs of a newly deregulated domestic transportation market. Since then, through its leading third-party logistics (3PL) market research and history of helping companies outsource logistics functions, A&A has become an internationally recognized key information resource for 3PL market research and consulting.

A&A’s mission is to have leading proprietary supply chain knowledge and market research not available anywhere else. As proof of its continued work in supporting its mission, A&A’s 3PL market estimates are the most often cited in securities filings by publicly traded 3PLs, media articles and trade publications. In addition, A&A’s email newsletter currently has over 46,000 subscribers globally.

A&A’s research complements its consulting activities by providing a continually updated detailed database for analysis. Based upon its unsurpassed knowledge of the 3PL market and the operations of leading 3PLs, A&A has provided strategic planning consulting services to over 30 3PLs, supported 17 closed investment transactions, and provided advice to numerous companies looking to benchmark existing 3PL operations or outsource logistics functions.

For more information, please contact:
Dick Armstrong at +1-608-873-2110, or email Dick@3PLogistics.com.
Evan Armstrong at +1-608-268-5860, or email Evan@3PLogistics.com.

Source:
Armstrong & Associates, Inc.
10401 West Lincoln Avenue, Suite 207
Milwaukee, WI 53227 USA
Phone: +1-414-545-3838 Fax: +1-414-545-3906
Website: www.3PLogistics.com