The Future of Transportation & Logistics

The Transportation & Logistics sector has experienced significant disruption during the last decade and throughout the pandemic. Against odds, the sector is showing significant growth and transformation. “The Future of Transportation & Logistics” survey conducted by KPMG in Greece, explores the sector structure, size and growth, financial trends and the different types of services offered. It provides an overview and comparative analysis of the key market players, the main barriers for new entrants and the expected future investment in the sector.

Additionally, the survey sheds light on the sector’s future outlook, highlighting trends, opportunities but also the driving forces behind the sector’s smart transition. Finally, as a growing number of retailers across all industries have been looking into innovative ways to improve their last mile economics and customer experience, they are increasingly turning to new click and collect solutions. The survey’s focused research compares the three models currently in use: Store Collection, Smart Lockers and the Curbside Pickup System.

Key findings:

• Transportation and storage Gross Value Added (GVA) in Greece accounted for 7.5% of the total GVA economic activity for 2019, the 5th highest among EU-27 countries. The 3PL sector is showing significant growth, with an average 9.8% CAGR in the 3PL industry revenue from 2015 to 2019, with EBITDA and liquidity portraying an overall positive performance of the sector over the same period.
  
• The Greek 3PL market mainly consists of small-medium players. 78% of the total 1 550 3PL companies have annual revenue below EURO 1 million. The market is competitive, highly fragmented despite the presence of many global logistics organizations and most companies are showing significant growth.
  
• There is a high investment activity and interest in the Logistics industry. More than EURO 150 million are expected to be invested in the development of storage & distribution facilities in the next few years.
   

Some of the prevalent trends are the following:

• The focus & investment in Robotics technology
• The increased significance of Advanced Analytics
• The steer towards sustainability and eco-consciousness
• The urbanisation of fulfilment operations

Main findings of the focused research:

• Store Collection solution is the simplest solution for order collection, offering flexibility and low costs for a small number of orders per day.
  
• Smart Lockers reduce the cost of the collection process, eliminating human contact. Its economics make it suitable for a medium number of orders per day.
  
• Curbside Pickup System is the solution that fully integrates robotics technology into the order collection process, offering the best customer experience, convenience and lower cost for a large number of daily orders.

Conclusions:

The Transport & Logistics sector in Greece accounts for more than 7% of GVA economic activity during 2019, with 3PL companies showing growth over the respective period. The Greek market is very fragmented, with mainly small and medium sized 3PL providers. Consequently, the competitiveness of the market is one barrier for new entrants; however new investment within the Logistics sector is evident. Organizations are increasingly steering their attention towards automation optimization solutions like robotics automation and advanced analytics to gain more sophisticated insights of their operations. In addition, logistics key players are implementing more environmentally friendly solutions that eliminate emissions and overall waste to become more efficient.