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the ability to give consumers what they want. Right now, we
seem to be doing good, but one-to-one is a scary number.”
Of course, the labor shortage also is accelerating adoption
of automation and other technology in warehouse and dis-
tribution operations. The warehouse automation market is
projected to grow at a CAGR of 14% to reach $30 billion by
2026. “The pandemic may serve as a tipping point for ware-
house automation,” the researchers pointed out. “Fast-moving
inventory requires more touches, and using robots helps mini-
mize employee interaction that spreads the virus.”
Operating during a period of increased operational com-
plexity, robots reduce losses related to employee turnover,
(AGVs) and autonomous mobile robots (AMRs).
The vast majority of American warehouse companies alsooffer a large range of third-party logistics (3PL) services.
The researchers note that 3PL services—both asset-based
and non-asset-based—were in great demand last year and
that will continue to be the case in the future. The continuing
disruption experienced by the economy also creates opportu-
nities for 3PL providers of all stripes. In turbulent times, the
deep knowledge and wide network of a 3PL become more
Yet turbulent times place increasing pressure on the 3PLsto have developed the right strategies in the past and to implement the right insights in the present. In2020—and moving forward through 2021—those 3PLs that prioritized resilience will become the dominant leaders in the segment, thereport predicts.
JACK BE NIMBLE, JACK BE QUICK
“This year the story is one of adaptationunder the most severe conditions in memory. Shippers and carriers had to continuouslychange plans as the means of logistics theyrelied on strained and sometimes broke,”stressed research leader Zimmerman duringthe report’s presentation and panel discussionheld virtually on September 23.
“Moving forward, supply chains must continue to provide goods and services to theAmerican public while dealing with tight capacity and volatile rising [carrier] rates. Thefirst half of 2021 has the highest rates the market has ever seen,” he added.
Zimmerman’s fellow panel members, whowere drawn from different corners of the lo
TRANSPORTATION COSTS (IN BILLIONS)Motor Carriers $685Parcel $119Railroads $74Air $96Water $26Pipeline $59Subtotal $1,059
INVENTORY CARRYING COSTS
Storage $146.5Financial Cost $121Other $114.5
(obsolescence, shrinkage, insurance, etc.)Subtotal $382
Carriers’ Support Activities $59
Shippers’ Administrative Costs $58
TOTAL LOGISTICS COSTS $1,558
Source: CSCMP’s 32nd Annual State of Logistics Report; A. T. Kearney analysisTHE STATE OF THE U.S. LOGISTICS MARKET, 2021