Singapore is at the heart of Southeast Asia and its geographical location makes it an important global logistics hub that connects manufacturers and customers to the rest of the world. As the logistics sector is important to any business, the reputations of this industry often hinges on the prompt and quality delivery of goods and services. Therefore, the logistics industry was one the first few industries to embark on the Industry Transformation Programme (ITP) in Singapore under the 2016 budget. Classified under the Transportation and Storage sector, the Logistics Industry is a key economic contributor for Singapore and the sector contributed ~% (2015) and ~% (2016) to the country’s GDP and employed ~%. The logistics & warehousing market has increased at a CAGR of ~% during 2011 to 2016. The market has increased from USD ~ billion in 2011 to ~ billion in 2016.
Singapore is positioned for growth as a global transshipment hub regardless of slow growth of the European and American markets. Singapore’s shipping industry location in the center of sea trade routes, its position as a major international trading hub and its modern and well connected Changi Airport, all stems to continuous growth. The robust growth in e-commerce and omni retail sector in the country has majorly influenced the growth rate of logistics and warehousing industry. Especially, the express delivery services offered by the e-commerce giants to the customers have accelerated the market. Other factors which led to this growth including government initiatives, growth in manufacturing industries and emergence of new manufacturing companies in Singapore, free trade agreements resulting in more trade activities, improved logistics infrastructure, technological advancement and others.
How Singapore Freight Forwarding Market is Performing?
Freight forwarding industry has grown tremendously in Singapore. It has been the leading segment in the logistics and warehouse market and has shown a tremendous growth rate in past few years. Expanding e-commerce sector, Omni-retail, pharmaceutical and biotech industry in the country are the main contributors to its growth during 2011-2016. Opening up of regional logistics centers of foreign companies and emergence of new manufacturing plants has made the performance of industry more promising and significant for its future growth
Freight forwarding market has dominated the overall market of Singapore logistics & warehousing services with the percentage share of ~% in terms of revenues in 2016
Sea freight movement has majorly dominated the market of Logistics in Singapore with the share of ~ % in 2016, followed by air freight (~ %) and land freight (~ %).
By type of delivery services normal delivery has contributed majorly in the revenues of Singapore logistics market over the past few years.
What is the Role of Warehousing Market in Singapore Logistics & Warehousing Market?
The warehousing industry in Singapore has observed a tremendous growth in terms of revenues as well as the volume handled by these warehouses in past few years. The factors such as growth in external trade, growth across major industry segments such as automobile, pharmaceutical, fast moving consumer goods (FMCG) and the emergence of organized retail have favorably influenced the growth of warehousing industry in Singapore.
The market size of Singapore warehousing market in 2011 was USD ~ billion and grew to USD ~ billion by 2016 at a CAGR of ~%. The growth in the market is also driven by increased demand for the outsourcing of warehouse services. Vendors in the market provide multiple value-added services to customers, including packaging, inventory management and others which is difficult to maintain during in-house warehouse operations. This has accelerated the demand of warehousing on lease and rent basis. The huge investment required for building a warehouse equipped with modern technologies and continuous up-gradation of these technologies has forced the companies to take the warehouses on rent or on lease.
Moreover, most of the large logistic players such as DB Schenker, DHL UPS, YCH, Yusen and several others have invested huge amount of money to construct world class warehouse facilities with latest storage and handling equipments as well as IT systems. This had resulted in the increasing size of the warehousing industry in the country.
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