The South Africa contract logistics market was valued at US$ 1,800.71 million in 2023 and is projected to reach US$ 2,787.43 million by 2031; the market is expected to register a CAGR of 5.6% during 2023–2031.
Analyst Perspective:
Major stakeholders in the South Africa contract logistics market ecosystem are technology providers, contract logistics service providers, end users, and aftermarket logistics. In contract logistics, the entire supply chain management constitutes many substantial aspects, such as mode of transportation, parcel picking and shipping process, warehouse management, and packaging infrastructures. Supply chain management further includes software such as contract management system, transportation management system (TMS), and warehouse management system (WMS). All different software required for managing diverse business functions is integrated with a common single platform for obtaining contract logistics services. DHL Group; DSV A/S; DB Schenker; DP World; Gulf Agency Company Ltd; CEVA Logistics; United Pharmaceutical Distributors (Clicks Group); GEODIS SA; Cargo Carriers Pty Ltd; and Value Logistics are among the major South Africa contract logistics market players. The companies are focusing on contract logistics services to cater to the requirements of end use industries such as aerospace, e-commerce, retail, automotive, industrial, pharmaceutical, healthcare, etc. The majority of the companies have been focusing on expanding their service range in remote locations and focusing on adopting green logistics to remain competitive in the market. For instance, in 2023, the contract logistics arm of DHL Group introduced DHL Supply Chain's Green Transport Policy, which became a part of the company's investment in decarbonized transport solutions. The continuous development and innovation in logistic services such as transportation, warehousing, distribution, packaging and processing, production logistics, and aftermarket services are anticipated to boost the South Africa contract logistics market growth.
Market Overview:
Contract logistics offer a wide range of services, from production to distribution and aftermarket services. The companies operating in the South Africa contract logistics market provide standardized warehousing, transport, and other value-added services to form a customized supply chain solution. For instance, the contract logistics services comprise planning, production activities, sourcing, packaging, aftermarket services, repairs, etc. Major contract logistics companies offer standardized solutions with the help of leading supply chain providers to meet the customer's expectations. The trend of outsourcing logistics and demand for value-added logistics services are expected to grow from 2023 to 2031. Moreover, the demand for supply chain services is expected to witness substantial growth in South Africa during the same period.
Gauteng province is one of the major hubs in South Africa for financial, transport, and manufacturing industries. This province is expected to become one of the most lucrative markets for contract logistics players, owing to the huge concentration of large industries. The Gauteng province accounts for approximately one-third of the GDP of South Africa. The Northern Cape and Northwest provinces are the other industrialized provinces of the South African economy. While mining and agriculture are the major sectors in the Northern Cape, mining is the largest industrial sector in the Northwest province. Gold, uranium, platinum, and diamonds are the prime minerals that are mined in the Northwest province. Durban, which lies in the KwaZulu Natal province, and Pretoria from the Gauteng province, are among the highly industrialized cities in South Africa. Cape Town, Johannesburg, and Pretoria are other important industrial hubs in the country, bolstering the South Africa contract logistics market share in global logistics market.
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South Africa Contract Logistics Market: Strategic Insights
Market Size Value in US$ 1,800.71 million in 2023 Market Size Value by US$ 2,787.43 million by 2031 Growth rate CAGR of 5.6% from 2023 to 2031 Forecast Period 2023-2031 Base Year 2023
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South Africa Contract Logistics Market: Strategic Insights
| Market Size Value in | US$ 1,800.71 million in 2023 |
| Market Size Value by | US$ 2,787.43 million by 2031 |
| Growth rate | CAGR of 5.6% from 2023 to 2031 |
| Forecast Period | 2023-2031 |
| Base Year | 2023 |
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Market Driver:
Positive Outlook of Manufacturing Sector Fuels South Africa Contract Logistics Market Growth
Manufacturing has been identified in the National Development Plan (NDP) of South Africa as a sector that significantly contributes to creating new job opportunities and GDP growth. The manufacturing sector in South Africa, which contributes approximately ~14% to the country's GDP, is still trying to regain pre-pandemic levels. As various obstacles such as the COVID-19 pandemic, economic instability, and natural calamities have disrupted the industry's development over the past few years, many efforts by the private and public sectors to revitalize and improve manufacturing operations across the country demonstrate an encouraging outlook for small- and medium-sized companies. The agro-processing, metal & mining, textile, consumer electronics, steel processing, automotive, and paper & pulp sectors primarily comprise the manufacturing sector. As per Statistics South Africa, the agriculture sector increased by 4.2%, contributing 0.1% to the GDP in Q2 2023. The agriculture sector in South Africa is enormously diverse compared to other countries in sub-Saharan Africa. This is owing to the country's climate that varies from sub-tropical on the east coast, dry in the Karoo, and Mediterranean on the west. The major crop produced in South Africa is grain, which includes maize, barley, oats, wheat, and sorghum. These contribute more than ~30% to the total agricultural produce. Cost-effective & quality machinery and technology are a major requirement for farming communities to combat droughts, reduce high investment costs, and overcome electricity restraints.
South Africa is one of the leading producers of vanadium, platinum group metals, ferrochrome, vermiculite, alumino-silicates, zirconium, manganese ore, titanium minerals, and antimony, coal, gold, iron ore, silicon metal, ferro-silicon, and fluorspar. The 5th South Africa Investment Conference 2023 identified the core investment opportunities in the mining sector of South Africa under the theme of "Mining: A New Partnership for Growth." Diversified investment opportunities, environment sustainable development, as well as combating the challenges posed by unstable power outages were major highlights of the conference. In South Africa, with the rise in foreign direct investment and trade, the automotive industry's growth strategies are being adopted, which are highly integrated into the global automotive environment. Under the South African Automotive Masterplan (SAAM) 2021–2035, the target is to produce 1.4 million vehicles per annum in South Africa by 2035, which is anticipated to substantially improve the country's position in global vehicle production ranking. The Automotive Production Development Program (APDP) substituted the export-driven Motor Industry Development Program in 2013 with the objective of boosting local production of automotive components while balancing the incentives for OEMs to manufacture light commercial vehicles and passenger cars in the country for the local and international markets. Further, the supply chain of spare parts, raw materials, and components is highly dependent on logistic services. Transporting, warehousing, and distributing required for expanding customer base leads to increased demand for proper contract logistics services. Thus, the positive outlook of the manufacturing sector bolsters the South Africa contract logistics market size.
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Segmental Analysis:
The South Africa contract logistics market analysis is carried out on the basis of the following segments: type, services, and end user. By type, the market is bifurcated into outsourcing and insourcing. The transportation managers strive to maintain a perfect balance between cost control, keeping a check on the shipping operations, and maintaining a safe working environment for the human personnel. With the required analysis and strategy formulation, the selection of the best method that supports the overall transportation function is extremely critical. The business size, complexity of the shipping operations, control of the operations, specialization, and stakeholder confidence influence the selection of the logistics type. Furthermore, the outsourcing segment is anticipated to hold a significant South Africa contract logistics market share during the forecast period.
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Regional Analysis:
The scope of the South Africa contract logistics market report encompasses South Africa. A combination of various micro as well as macroeconomic factors influences the functioning of the market in South Africa. The age and population demographics and disposable incomes of individuals, coupled with literacy rates in the country, constitute the microeconomic factors that contribute to the growing South Africa contract logistics market size. Key opportunities in the market are the increase in adoption of sustainable solutions, and integration of technology, which enhances efficiency in the logistics sector. The political uncertainty in the country has hit the economy of the country adversely. There are three trends expected to shape the future of the South Africa contract logistics market such as logistics digitization; the rise in B2B logistics companies; and the implementation of artificial intelligence (AI), cloud-based software, and process automation with an increase in investments toward infrastructure development.
South Africa has an extensive network of ports, airports, railways, and roads that create jobs and significant economic activity across the country. On a global scale, South Africa is a major player in international trade. With our strategic location, well-developed ports, and well-established trade routes, South Africa has become a significant trade hub worldwide. According to Global Edge, South Africa gets 33.44% of its GDP from exports and 31.46% from its imports. Challenges that might negatively impact the demand for contract logistics in the coming years include a lack of storage infrastructure, volatile fuel prices, and security concerns.
Key Player Analysis:
Cargo Carriers (Pty) Limited, DHL Group, CEVA Logistics, DB Schenker, Gulf Agency Company Ltd (GAC), DP World, United Pharmaceutical Distributors (Clicks Group), Value Logistics, DSV A/S, and the GEODIS SA Ltd are among the key players profiled in the South Africa contract logistics market report. The report includes growth prospects in light of current South Africa contract logistics market trends and driving factors influencing the growth of the South Africa contract logistics market.
Recent Developments:
A few recent developments by the South Africa contract logistics market players, as per their press releases, are listed below:
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June-2023 | The owner-managed logistics company, Röhlig Logistics, is strategically advancing its contract logistics business. Owing to its ambitious expansion strategy, Röhlig has approximately 260,000 square meters of warehouse space in more than 15 countries. |
August-2023 | Home to one of the largest seaports in South Africa and in proximity to a wide range of multinational companies, the global logistics provider—Scan Global Logistics (SGL)—opened a new office in the strategic location of Port Elizabeth in the province of Eastern Cape. The new office opening is the company’s fourth in South Africa within two years, solidifying its position in the fast-growing country. |
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Type, Services, and End User
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
This text is related
to country scope.
Frequently Asked Questions
DHL Group; DSV A/S; DB Schenker; DP World; Gulf Agency Company Ltd; CEVA Logistics, United Pharmaceutical Distributors (Clicks Group); GEODIS SA; Cargo Carriers Pty Ltd; and Value Logistics are among the major contract logistics service providers in South Africa.
The need for proper transport and logistics services has been rising owing to population growth worldwide. Sustainable and environment-friendly logistics in South Africa highlight lowering emissions by utilizing clean energy sources, such as wind and solar power, to power fleet vehicles. As South Africa is already facing high air pollution levels, especially in major cities, this sustainable approach is significantly beneficial. By shifting to green transport and logistics, South Africa is anticipated to reduce these emissions and protect the health of its citizens. the increasing adoption of sustainable solutions that focus on reducing carbon footprints aligns with organizations' business strategy, which is anticipated to create lucrative opportunities for the South Africa contract logistics market during the forecast period.
Rapid growth e-commerce sector and rapid development in the automotive and healthcare industry is propelling the growth of contract logistics market in South Africa.
Growing development in the manufacturing sector, expanding logistics sector, and rising e-commerce sector, which are acting as major drivers for the contract logistics market in South Africa.
The List of Companies - South Africa Contract Logistics Market
- Cargo Carriers (Pty) Limited
- DHL Group
- CEVA Logistics
- DB Schenker
- Gulf Agency Company Ltd (GAC)
- DP World
- United Pharmaceutical Distributors (Clicks Group)
- Value Logistics
- DSV A/S
- GEODIS SA.
The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.
- Data Collection and Secondary Research:
As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.
Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.
- Primary Research:
The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.
A typical research interview fulfils the following functions:
- Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
- Validates and strengthens in-house secondary research findings
- Develops the analysis team’s expertise and market understanding
Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:
- Industry participants: VPs, business development managers, market intelligence managers and national sales managers
- Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.
Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.
- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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