Connected Logistics Market Size - By Technology (Bluetooth, Cellular, Wi-Fi, GPS), Component (Hardware, Software, Services), Mode of Transport (Railways, Airways, Roadways, Waterways), Deployment Model, Organization Size, End Use, Forecast 2024 - 2032

Connected Logistics Market Size

Connected Logistics Market size was valued at USD 33.7 billion in 2023 and is anticipated to grow at a CAGR of over 10% between 2024 and 2032. The increasing use of Internet of Things (IoT) technology is a major driver of the market. IoT equipment, including sensors and GPS trackers, allow for real-time monitoring of the location, condition, & status of commodities along the supply chain. For instance, in October 2023, Overhaul, a software-based supply chain visibility, risk, compliance, and insurance solution for the world's leading brands introduced Shipment Connect, an application that offers customers unmatched visibility into logistics processes.
 

The growth of e-commerce and the globalization of trade has increased the complexity of logistics operations, which necessitates the use of innovative technologies for effective management. There is an increasing desire for faster & more reliable product deliveries, putting pressure on organizations to improve its supply chain management procedures. Advanced analytics and AI-powered solutions are becoming increasingly important, as they offer essential insights into demand patterns, forecast potential disruptions, and optimize inventory management.
 

The growing demand for operational efficiency and cost reduction is another key driver of the connected logistics market. Companies face constant pressure to optimize their supply chain systems to remain competitive. AI, Machine Learning (ML), and advanced analytics are used in logistics operations to forecast demand, enhance inventory management, and optimize transport routes. This technological integration contributes to lower operational costs, faster delivery times, and higher overall productivity, ensuring data integrity and streamlining supply chain procedures.
 

Many businesses still use outdated software and infrastructure for its logistics operations, which may not be compatible with the new IoT, AI, or cloud-based solutions. This compatibility gap restricts the widespread adoption of connected logistics technologies, necessitating significant modification, data migration, and, in some cases, complete restructuring. Being inherently time-intensive, these connections can defer the realization of benefits such as improved visibility, efficiency gains, and cost savings, posing a barrier to connected logistics market expansion.
 

The large volume of data generated by these technologies, including real-time shipment data, customer information, and operational insights, creates substantial security and privacy threats unless it is appropriately protected. Concerns about data breaches, cyber-attacks, and unauthorized access can hinder firms from implementing linked logistics systems. Additionally, compliance with data protection legislation, such as General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA) complicates data security management in a global setting.
 

Connected Logistics Market Trends

The use of AI and ML to improve decision-making and automation skills is a growing trend in the connected logistics business. AI-powered algorithms analyze large amounts of real-time data to forecast demand, optimize routes, and automate routine logistics operations. This breakthrough not only improves operating efficiency but also allows for proactive management of supply chain disturbances, resulting in increased overall agility. The increasing focus on sustainability and environmentally friendly practices is compelling the logistics providers to implement IoT-based solutions for monitoring carbon footprints, reducing energy use, and minimizing environmental effects throughout their supply chains.
 

For instance, in April 2024, Nokia announced the introduction of its 5G private wireless connectivity technology aimed at transforming logistics operations. By integrating this technology, Nokia aims to revolutionize warehouse and fulfillment center management with enhanced automation capabilities. This initiative promises to significantly improve operational efficiency, reduce energy consumption, and optimize asset tracking across the supply chain, marking a pivotal advancement in logistics technology.
 

Connected Logistics Market Analysis

Based on component, the market is divided into hardware, software, and services. The hardware segment is expected to reach a value of over USD 45 billion by 2032.
 

• The increasing adoption of IoT devices and sensors in logistics and supply chain operations drive the demand for hardware components. These devices play a crucial role in real-time tracking, monitoring conditions such as temperature & humidity, and ensuring the security of shipments.
   
• The global expansion of e-commerce and the complexity of supply chain networks further propel the demand for hardware components. Companies require reliable hardware infrastructure to support their logistics operations, ensuring seamless connectivity, data accuracy, and operational efficiency. As the global logistics industry continues to invest in upgrading its technological capabilities, the hardware segment is set to witness substantial growth, meeting the evolving demands of a digitally driven logistics landscape.
   

Based on end use, the connected logistics market is divided into retail & e-commerce, automotive, aerospace & defense, healthcare, energy, electronics & semiconductors, and others. The automotive segment is the fastest growing segment with a CAGR of over 15% between 2024 and 2032.
 

• The expansion of global automotive markets and the rise in cross-border trade require robust logistics solutions to efficiently manage complex supply chain networks. Connected logistics provides transparency, traceability, and compliance with regulatory standards, thereby reducing risks & operational costs.
   
• Automotive manufacturers are increasingly adopting connected logistics solutions to optimize their supply chains. These solutions enable real-time tracking of vehicle components and parts, enhancing inventory management, reducing lead times, and improving the overall operational efficiency.
   

North America dominated the global connected logistics market in 2023, accounting for a share of over 35%. The region's strong presence in industries such as e-commerce, automotive, healthcare, and retail contributes to the demand for efficient logistics solutions. The growth of online shopping and the need for timely deliveries further stimulate investments in connected logistics to meet consumer expectations and optimize supply chain operations.
 

The U.S. plays a pivotal role in the market, characterized by its advanced technological infrastructure, extensive adoption of IoT and AI in logistics operations, and a thriving ecosystem of tech innovators and logistics providers. With a strong emphasis on efficiency, transparency, and customer satisfaction, companies based in the U.S. leverage connected logistics solutions to optimize supply chain management across diverse sectors such as e-commerce, automotive, healthcare, and retail.
 

China is experiencing robust growth in the connected logistics market, driven by its rapid industrialization, expansive e-commerce sector, and government initiatives promoting digital transformation. Chinese companies are increasingly adopting advanced technologies such as IoT and AI to streamline supply chain operations, enhance efficiency, and meet the growing demands of domestic and international markets.
 

South Korea is witnessing significant growth in the connected logistics sector, supported by its highly developed telecommunications infrastructure and strong technological capabilities. The country's focus on innovations and digitalization in logistics is driven by a competitive market environment and a robust manufacturing sector. South Korean companies are integrating IoT, big data analytics, and automation to optimize supply chain processes, reduce costs, and enhance logistics efficiency.
 

Japan's connected logistics market is advancing steadily, characterized by an advanced logistics industry and a strong emphasis on technological innovations. Japanese companies are leveraging IoT, AI, and robotics to improve warehouse automation, optimize transportation networks, and enhance the overall supply chain visibility and efficiency. With a focus on precision and reliability, Japanese logistics providers are investing in cutting-edge technologies to address challenges such as aging workforce demographics and increasing demand for faster and more reliable delivery services.
 

Connected Logistics Market Share

IBM Corporation and Cisco System Inc. hold a significant share of over 15% in the connected logistics industry. IBM's expertise in cloud computing, data analytics, and AI, coupled with Cisco's leadership in networking solutions and IoT infrastructure, enable them to offer comprehensive connected logistics solutions. Together, these companies provide integrated platforms that enhance supply chain visibility, optimize operations, and improve decision-making processes for businesses globally. This collaborative approach leverages advanced technologies to address evolving market demands, driving innovations and efficiency across logistics & supply chain management sectors.
 

Some of the other major players in the market are HCL Technology Limited, NEC Corporation, DHL International GmbH, FedEx Corporation, United Parcel Service (UPS), Alibaba Group, Siemens AG, and Oracle Corporation.
 

Connected Logistics Market Companies

Major players operating in the connected logistics industry are:

• IBM Corporation
• Cisco System Inc.
• Honeywell International Inc. 
• Intel Corporation
• Infosys Limited
• ORBOCMM
• Freightgate Inc.
   

Connected Logistics Industry News

• In April 2024, Pitney Bowes, a prominent player in the global shipping and logistics sector, announced significant advancements aimed at enhancing its service offerings in the small parcel and business-to-consumer (B2C) e-commerce market. This strategic move enables brands and retailers to achieve rapid delivery, reaching 90% of the U.S. population within 1 to 3 days.
   

The connected logistics market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD million) from 2021 to 2032, for the following segments:

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Market, By Technology

• Bluetooth
• Cellular
• Wi-Fi
• GPS
• Others

Market, By Component

• Hardware 
  • RFID tags
  • Sensor nodes
  • Beacon
  • Gateways
  • Others (IoT devices, communication devices) 
• Software 
  • Warehouse management
  • Fleet management
  • Freight transportation management
  • Asset tracking and management
  • Data management and analytics
  • Others
• Services
  • Consulting services
  • Integration services
  • Maintenance and support services

Market, By Mode of Transport

• Railways
• Airways
• Roadways
• Waterways

Market, By Deployment Model

• On-premise
• Cloud

Market, By Organization Size

• Small & Medium Enterprises (SME)
• Large enterprises

Market, By End Use

• Retail & e-commerce
• Automotive
• Aerospace & defense
• Healthcare
• Energy
• Electronics & semiconductors
• Others

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• MEA
  • UAE
  • Saudi Arabia
  • South Africa
  • Rest of MEA