The global freight management market is projected to grow at a CAGR of 20.15% during the forecast period, reaching a total market size of US$84.602 billion in 2025 from US$28.121 billion in 2019. The freight management system is a system required for overseeing and managing a cost-efficient operation and delivery of goods. It helps in combining logistics experience, human resources, and knowledge to ensure smooth coordination between carriers and shippers. The system is widely used for providing solutions and assisting in regular operations such as shipping, detecting, tracking, reducing data entry, eliminating errors, etc. Freight management systems have many applications like pallet tracking, Proof of Delivery (POD) scanning, customer Electronic Data Interchange (EDI), vehicle maintenance and repairs, interfacing, consistent auto consignment pricing, consignment entry, and comprehensive operational reporting.
The freight management market is segmented on the basis of solution type, deployment type, application, and geography. By solution type, the freight management market is segmented into the logistic management systems, electronic data interchange solutions, baggage and container scanning system, freight operational management system, and others. On the basis of deployment, the market is segmented into on-premise and cloud. By application, the market is segmented into roadways, railways, seaways, and airways.
The growth of the freight management market is driven owing to the rising implementation of free trade policies among different countries so as to increase the import-export around the globe. Global trade is rising due to organizations like WTO (World Trade Organization) which are encouraging open door policy for promoting international trade by providing trade incentives and relaxation in regulations so as to reduce or eliminate trade barriers among various countries and/or regions. According to the WTO statistics, the merchandise trade volume index increased from 100 in 2008 to 126.3 in 2018. Increasing global trade has made it compulsory for enterprises to use freight management solutions for improving delivery capabilities, decreasing time spent on delivery, and saving time, thus augmenting the market growth of freight management. The growing global e-commerce industry is also a major driver for the freight management market as this industry requires the use of freight management solutions for on-time delivery and efficient transportation of goods across the globe.
Logistic Management system and Freight Information system hold significant market share
The market for logistics management systems is rising due to its requirement in managing, tracking, and keeping a count of logistics through the cloud as well as on-premise computing systems for better efficiency and effective delivery of logistics. The logistics management system includes a warehouse management solution and an enterprise resource planning solution. The freight Information system also accounts for significant market share in the global freight management market as it helps in providing essential information about consignment and helps in taking required actions in case of emergency and deviation from on-time delivery. The freight information system includes the electronic data interchange solution and freight tracking system. Baggage and cargo screening system is required for screening mail, parcels, personal bags, for security purposes. They help in revealing what’s inside the baggage or cargo to inspect it for security reasons. The market for freight operational management systems is augmenting as it helps in streamlining logistical supply chain operations and increase logistical efficiency. This system helps in track/trace and optimize shipment with selected carrier and even help in payment and freight audit. Freight operational management system includes order, revenue, load, and quote management solutions.
Rising number of shipments via airways leading to the growth of the airways segment
Airways is one of the most widely used application for the transportation of goods across different countries. According to the World Bank data shipment through airways has been increasing; the air transport freight increased from 158,487.87 million ton-km in 2008 to 212,866.65 million ton-km in 2018.
The demand for air freight is growing owing to the strong strengthening of the international e-commerce industry and the transport of time- and temperature-sensitive goods across the globe. Moreover, supportive government policies to boost the air freight transport sector is further contributing to the growth of this segment. For instance, the Indian government unveiled its national air-cargo policy in January 2019 to make the India among the top five air freight markets by 2025. The policy aims at encouraging code sharing/inter-line agreements between Indian and foreign carriers.
By deployment model, cloud segment expected to grow at a significant CAGR
The demand for cloud-based freight management solutions is rising as they provide speed, efficiency, and reliability that determine the success of the freight business. Rising digitalization and technological advancements are leading to the generation of huge volume of data which, in turn, is boosting the growth of new analytics platforms across the freight management market. The logistics industry is experiencing significant growth on account of a rise in the on-demand economy and e-commerce trade globally. As such, companies with large fleet are in need of a reliable solution to manage and control their operations effectively. Cloud-based solutions also result in cost reduction by getting rid of physical IT infrastructure and better resource utilization while increasing profitability.
APAC one of the major regional markets for freight management solution providers.
Regionally, the freight management market is classified into North America, South America, Europe, the Middle East and Africa, and Asia Pacific. APAC is projected to witness the significant market growth rate during the forecast period owing to the booming e-commerce industry across the region. Increasing internet and smartphone penetration and expansion of global e-commerce vendors across the region is encouraging the freight industry to sharpen its offerings and launching solutions specifically aimed at meeting the fast-changing needs of the multi-channel retail market. North America also holds a significant market share on account of the early adoption of freight management solutions by users in the region coupled with the presence of leading solution providers in North American countries. Rising investments in R&D by freight management solutions providers are further contributing to the freight management market growth in this region. For instance, Walmart Canada has recently launched a blockchain-based freight and payment network which uses distributed ledger technology to track deliveries, verify transactions, and automate payments.
The global freight management market is segmented by solution type, deployment model, application, and geography.
Frequently Asked Questions (FAQs)