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Coca Cola Essay

5370 words - 22 pages

The Current Status and Future Prospects of the Third
Party Logistics Industry in North America:
The 2015 3PL CEO Survey



Dr. Robert C. Lieb
Professor of Supply Chain Management
D’Amore-McKim School of Business
Northeastern University
Boston, MA



Dr. Kristin J. Lieb
Associate Professor of Marketing Communications
Emerson College
Boston, MA




January 2016

The Current Status and Future Prospects of the Third
Party Logistics Industry in North America:
The 2015 3PL CEO Survey



This paper is based upon a 2015 survey of the CEOs of 15 of the largest thirdparty logistics companies serving the North American marketplace. ...view middle of the document...

As this industry has continued to evolve the CEOs
leading those 3PLs have faced the formidable task of matching service offerings and

geographical coverage to the ever-changing needs of an increasingly diverse
customer base.

Understanding the perspectives of these individuals on contemporary issues

in the 3PL industry is important not only to their peers as they develop market
strategies, but also to those using or considering the use of 3PL services as well as
those conducting research into the 3PL industry. The purpose of the research
discussed in this paper is to provide insight into those perspectives.
Methodology
This paper is based on a mid-2015 survey of the CEOs of 15 of the largest
3PLs serving North America. The authors also conduct similar annual surveys of 3PL
CEOs in Europe and the Asia-Pacific region.

The CEO of each company included in the survey was contacted by e-mail

and asked to participate in a web-based survey. An initial target group of 20 large
3PLs operating in North America was contacted, and the CEOs of those companies
agreed to participate. However, only 15 CEOs subsequently completed the survey
online. The companies that participated in the 2015 North American survey are
shown in Exhibit 1.
Financial State of Health
Revenues and Profitability

All 15 companies reported revenue data in responding to the survey.

Collectively, these companies generated approximately $25 billion in North
American revenues during 2014 which represents approximately 16% of the
estimated $158 billion revenue base of the region’s entire 3PL industry.

When the CEOs were asked to categorize the success of their companies in
meeting their North American revenue growth projections during 2014 four (27%)
reported their companies exceeded those projections, eight (53%) indicated they
met their projections, and three (20%) reported their companies failed to meet their
projections.
Next, the CEOs were asked to categorize the profitability of their companies’
North American business units during 2014. One (7%) reported his company had
been very profitable and 14 (93%) said their companies had been marginally
profitable. For the fifth consecutive year none of the companies involved in the
North American survey were unprofitable. As has been the case for the past several
years, despite the failure of some 3PLs to meet their regional revenue growth
projections, they were still able to generate profits. To a great extent that continues
to be a function not only of the ability of those companies to adjust the scale and
cost of their operations to volume, but also to a continuing focus on the “quality” of
their customers. As we have documented in earlier papers, over the past several
years many large 3PLs have devoted considerable attention to identifying their most
important customers not only in terms of volume, but also in terms of yield. Having...

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