Those findings were reported in the 19th Annual Survey of Third-Party Logistics Providers authored by professor of supply chain management at Northeastern University, and sponsored by . The survey results were revealed at the Global Conference of the Council of Supply Chain Management Professionals today in Atlanta.
3PLs Profitable but Face Economic Headwinds
Of the 31 global 3PL companies that participated in the survey, 28 reported their companies were profitable during 2011, with three reporting they broke even, and three more reporting their companies were unprofitable. Global CEOs reported they continue to see increasing cost pressures on customers, continued economic uncertainty, and tightening capacity across modes.
Even though CEOs may have had a hard time meeting their revenue targets, they鈥檝e been able to be profitable, Lieb said, adding that they鈥檝e done so remaining flexible and responding to the market quickly. 鈥淭hat has been important to survive in this industry,鈥� he said.
Near-Shoring Continues
As part of that agility, CEOs in all areas reported a move towards near-shoring.
Penske鈥檚 Joe Gallick said, 鈥渄ue to the greater potential for disruption and other issues affecting global supply chains, we are seeing that off-shoring has evolved into near-shoring.鈥�
Lieb said many companies failed to consider all the costs and risks involved with manufacturing off shore. Rising costs in China and higher oil prices have made people reconsider.
鈥淎ll of a sudden the price advantage you thought you had wasn鈥檛 as great as you anticipated,鈥� Lieb said.
There have been several supply disruptions from natural disasters recently, such as the Tsunami in Japan, which made companies rethink their business continuity planning.
鈥淚n many cases companies had to shut down production because they didn鈥檛 have alternative sources or if they did have alternative sources they were clustered in the same region. That made them think more about sourcing closer to home,鈥� Lieb said.
Gallick added that Penske is especially interested in seeing how near-shoring evolves in Asia in the coming years as local manufacturers increasingly service the growing needs of the local population.
Growth Outlook
Within the report, North American companies said they expect to grow 10 percent over the coming year with an industry growth rate of 6.9 percent.
To increase growth, logistics CEOs are targeting specific industries. More than half of the CEOs surveyed believe the medical devices sector of the health care industry will grow fastest during the next three years.
鈥淭he aging baby boomer generation and increasing role that technology plays in our medical system has led logistics companies to find great opportunities within all areas of the healthcare industry, from pharmaceuticals to medical devices,鈥� Gallick said.
鈥淎s our healthcare system becomes more complex, companies are contracting logistics firms to develop transportation solutions, reducing internal operations costs and providing higher quality service for their customers.鈥�
Twenty-three of the 31 companies surveyed already provide 3PL services to customers in the health care industry. 鈥淭he healthcare industry has complex supply chains and they aren鈥檛 very efficient. 3PLs are targeting that as a key industry they鈥檙e trying to establish a presence in,鈥� Lieb said.
Closer Customer Collaboration
All CEOs reported seeing more collaboration between large 3PLs and their key customers and said logistics providers are continuing to capture and use data more effectively.
Lieb said 3PLs can play a key role in helping customers manage their own data.
鈥淢any of their big clients have grown primarily through acquisitions. When you acquire somebody, their information system doesn鈥檛 mesh with yours. If they can use a system through their 3PL, the 3PL can provide them with a kind of continuity across the supply chain,鈥� he explained.
Nearly two thirds of the companies participating in the survey introduced new service offerings in 2011.
鈥淭here is a lot of pressure from the people who buy the services to have one-stop shopping. 3PLs start adding services because they don鈥檛 want to risk them going to someone else that can do everything,鈥� Lieb said.
Rising Costs Driving Logistics Outsourcing
Gallick sees customers increasingly looking to outsource a broader range of logistics and transportation type services as they struggle to cope with variable costs for fuel, driver shortages, escalating costs of new equipment, as well as regulations such as CSA and HOS.
鈥淭he 3PL survey data reveals what we see every day, namely that the increasing complexity and higher costs of running and owning a private truck fleet for example make a very compelling case for switching to a .鈥�
鈥淭his is where full-service solutions such as dedicated contract carriage allow customers to better forecast and manage costs upfront and focus on their core offerings,鈥� he said.
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By 鈥淢ove Ahead鈥� Staff
鈥淭he competitive spirit of the Tech Challenge is quite a sight to behold,鈥� stated Bill Jacobelli, Penske senior vice president of maintenance. 鈥淪ome of our company鈥檚 best truck technicians took part in this event, and I commend these outstanding gentlemen for their noteworthy achievements. 
鈥淭he improved used truck website also complements our robust call center, where our customers can personalize their purchases to fit the needs of their fleets,鈥� Mitchell added.
In recognition of this week鈥檚 National Truck Driver Appreciation Week, acknowledges its six drivers who were nominated for (TRALA) 2012 Driver of the Year Award earlier this year.
Why are you proud to be a truck driver?