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3PL growth slows

Staff -- Modern Materials Handling, 2/1/2003

Demand for third-party logistics (3PL) services has remained especially strong in a weak economy…until now. A new survey by Accenture consultants and Northeastern University says that just 56% of manufacturing executives would increase their use of 3PLs. That's down from 74% in the 2000 and 2001 surveys. The CEOs of 3PLs also predict less robust growth—projecting an 11% one-year growth rate for 2003, down from 17% in the 2001 survey. Reasons include pricing pressures, staffing issues, increasing technology demands by customers, and complaints that the transition to a 3PL is too time-consuming, says Stephen Kendrick, a partner in Accenture's Supply Chain Management practice.

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