A quarter of companies have taken some third party logistics work back in-house in the past year, and 58 per cent say they are reducing or consolidating the number of 3PLs they use, according to an annual review of the market.
However, almost two thirds of shippers said they were increasing their use of third party logistics providers, according to the 16th Annual Third-Party Logistics Study produced by Capgemini Consulting in cooperation with Penn State University, Heidrick & Struggles, and Panalpina.
On average, 42 per cent of logistics spend goes on outsourcing – the same as last year. However, the number of shippers that judge their 3PLs to be sufficiently agile and flexible, at 68 per cent, is down from last year’s 72 per cent.
The 16th Annual Third-Party Logistics Study
The study highlighted the fact that the logistics industry is experiencing a shortage of capable supply chain managers prepared to work in vital management positions.
It revealed shippers and 3PLs most highly value operational execution (51 per cent and 60 per cent respectively) followed by people management and development skills (54 per cent and 43 per cent respectively) in their leaders.
“To date, the majority of both shippers and 3PLs recruit from inside their own industries but many are increasingly looking to recruit talent from other industries,” the report said. “Company success and performance, attractive salary and benefits and personal development opportunities within the company are considered the top qualities needed to attract talent.”
Dan Albright, vice president and North American supply chain leader at Capgemini Consulting, said: “The responses from this year’s study represent an interesting record of the shifting use of 3PL services.
“While some companies are increasing outsourcing services, we are still seeing the consistent churn that occurs each year with 3PL respondents observing that some of their customers are returning logistic activities back in-house. It’s vital that 3PLs and shippers work in close collaboration and that 3PLs remain innovative by offering value added services to provide true value to shippers to help reverse this trend.”
The 2012 Third-Party Logistics Study is based on over 2,250 responses from both shippers and logistics service providers in North America, Europe, Asia-Pacific and Latin America, as well as other locations throughout the world such as the Middle East and Australia.