Trends in 3Pl / Customer Relationships

TRENDS IN Global and Regional Infrastructure,3PL / CUSTOMER Logistics Costs, and Third-Party Logistics MarketRELATIONSHIPS Trends and Analysis

NovemberOctober 2017 2016

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Contents Global and Regional Infrastructure 5 Brazil 6 India 6 China 7 Global Logistics Costs and Third-Party Logistics Revenues 9 Third-Party Logistics Market 12 3PL Revenue and Growth Rates Analysis 16 Major Region 3PL Market Growth Trends 19 Major Players in Third-Party Logistics 25 Global Logistics Costs by Mode or Function 33 Appendix A: Global Logistics Costs and Third-Party Logistics Revenues 2010-2022E 35

Contents Table 1. Global Transportation Infrastructure 5 Figure 1. China’s “Belt and Road Initiative” (BRI) 8 Figure 2. Global Logistics Costs and Third-Party Logistics Revenues (US$ Billions) 9 Figure 3. 2016 Logistics Costs for Key Regions and Countries (US$ Billions) 10 Figure 4. 2016 Logistics Costs for Key Regions and Countries as a % of GDP 10 Figure 5. Distribution of Logistics (GDP %), 3PL Revenue % and LPI 11 Figure 6. Logistics Cost Growth for Key Regions and Countries 11 Figure 7. GDP Growth for Key Regions and Countries 12 Table 2. Third-Party Logistics Value-Added Services 13 Table 3. Select 3PL Acquisitions (US$ Millions) 14 Figure 8. Key Drivers of 3PL Market Growth 15 Figure 9. 2016 3PL Revenue for Key Regions and Countries (US$ Billions) 16 Figure 10. 3PL Revenue Growth for Key Regions and Countries 17 Figure 11. 2016 Asia Pacific 3PL Revenue Percentage by Country 18 Figure 12. 3PL Revenues by Major Geographic Region (US$ Billions) 19 Figure 13. VAWD Revenues by Major Geographic Region (US$ Billions) 20 Figure 14. ITM Revenues by Major Geographic Region (US$ Billions) 21 Figure 15. Total and Segment Third-Party Logistics Global Revenues (US$ Billions) 22 Figure 16. 3PL Revenues by Industry for the Fortune 500 Global (US$ Billions) 23 Table 4. Compound Annual Growth Rates by Industry for the Fortune 500 Global 23 Table 5. E-Commerce Logistics Costs, 3PL Revenue, and Growth Rates (US$ Billions) 24 Table 6. Top 50 Global 3PLs Ranked by 2016 Gross Logistics Revenue (US$ Millions) 25 Figure 17. Distribution of the Top 50 Global 3PLs by Country Headquarters (Number of 3PLs, Percent of Total) 26 Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions)* 27 Table 8. Top 25 Global VAWD 3PLs Ranked by 2016 Warehouse Space (Millions of Square Feet) 32 Figure 18. 2016 Trucking and Total Logistics Costs for Key Regions and Countries (US$ Billions) 33 Figure 19. 2016 Inventory Carrying and Warehousing Costs for Key Regions and Countries (US$ Billions) 34 Table 9. 2010-2011 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 35 Table 10. 2012-2013 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 37 Table 11. 2014-2015 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 39 Table 12. 2016-2017 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 41 Table 13. 2018-2019 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 43 Table 14. 2020-2021 Global Third-Party Logistics Market and Segment Revenues by Country/ Region (US$ Billions) 45 Table 15. 2022 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 47

Global and Regional Infrastructure

Supply chain management capabilities vary greatly between countries. Differences fall into two major categories: 1.) information flow and controls and 2.) physical limitations. Advanced economies generally have better highways, ports and railways, as well as better communication systems and technology to leverage. Political changes can especially complicate the latter, but normally are limited to emerging market/developing economy countries. As a general rule, logistics costs as a percent of gross domestic product (GDP) are lower in advanced economies and higher in emerging market/developing countries. Table 1 presents basic infrastructure results for 15 countries.

Table 1. Global Transportation Infrastructure

Ranked by 2016 2016 3PL Roadways Roadways Railways Railways Waterways Waterways Pipelines Country GDP Size* Revenue Rank km Rank km Rank km Gas km (US$ Billions) (US$ Billions)

United States 18,569.1 1 6,586,610 1 293,564 5 41,009 1,984,321 166.8 China 11,218.3 3 4,577,300 2 124,000 1 110,000 70,000 166.7 Japan 4,938.6 6 1,218,772 11 27,311 44 1,770 4,456 44.1 Germany 3,466.6 12 645,000 6 43,468 18 7,467 26,985 32.1 United Kingdom 2,629.2 18 394,428 16 16,837 31 3,200 28,603 24.2 France 2,463.2 8 1,028,446 9 29,640 Not Ranked 8,501 15,322 24.5 India 2,256.4 2 4,699,024 5 68,525 9 14,500 13,581 20.5 Italy 1,850.7 15 487,700 14 20,182 36 2,400 20,223 19.0 Brazil 1,798.6 4 1,580,964 10 29,850 3 50,000 17,312 18.8 Canada 1,529.2 7 1,042,300 4 77,932 77 636 110,000** 14.0 South Korea 1,411.3 46 99,025 52 3,874 50 1,600 2,216 14.1 Australia 1,259.0 9 823,217 7 36,968 42 2,000 30,054 11.0 Spain 1,232.6 11 683,175 17 16,102 63 1,000 10,481 11.9 Mexico 1,046.0 20 377,660 18 15,389 33 2,900 18,074 13.1 Indonesia 932.4 14 496,607 27 8,159 7 21,579 11,702 16.3

*International Monetary Fund, World Economic Outlook Database, Gross Domestic Product, Current Prices **Includes gas and liquid petroleum

Sources: International Monetary Fund http://www.imf.org/external/pubs/ft/weo/2017/01/weodata/index.aspx, April, 2017 Central Intelligence Agency https://www.cia.gov/library/publications/resources/the-world-factbook/, August, 2017

Not surprisingly, the countries with the largest economies dominate infrastructure statistics. The United States has the most kilometers of highways, railways and pipelines. China, with the second largest economy, is third in the amount of highways and second in railways. India is second in total kilometers of roadways. However, just over 60% of India’s roadways are paved and it has very few modern four- lane highways. Even some of these, like Highway 9 from Mumbai to Pune, have uneven surfaces and transportation obstacles. Australia, India, and Brazil have railway systems with different gauges making railcar and locomotive interchanges impossible. As a result, the rail and intermodal abilities are compromised.

Pipelines are the most inexpensive and environmentally friendly methods of transportation. The U.S. and Canada have the largest amounts.

Some small countries/regions like Singapore, Hong Kong and the Netherlands have high-quality infrastructure for all transportation modes. They are also key crossroad locations for global trade, transportation and storage.

In addition to physical infrastructure limitations, most emerging market/developing economy countries have various forms of information controls which seriously disrupt freight flows and the ability to do business.

Most of the disruptions increase cost and lower efficiencies within their host countries. Here are some examples: Brazil In Brazil, the governmental challenges to managing transportation are substantial. A third-party logistics provider (3PL) can manage carriers, handle proof of delivery (POD) management and settlement, plan routings, handle rates and develop solutions. Sounds like routine transportation management except for the consequences of governmental activity.

First among these is the impact of Agência Nacional de Vigilância Sanitária (ANVISA) or The National Health Surveillance Agency. In addition to controlling production and marking of drugs, devices and services, the agency has authority over transportation infrastructure used for the movement of drugs, devices, etc. As a result, the carriers, trucks and warehouses used by a 3PL have to be approved by ANVISA. To comply, a 3PL can keep track of truck licensing, inspection and insurance and has ultimate responsibility for compliance.

In addition to the ANVISA requirements, states require individual facility licenses under the Visa program. Much more problematic for transportation management, however, is the value-added tax, ICMS. ICMS is the tax on the circulation of goods, interstate and intercity transportation, and communication services, even when the operation is initiated abroad.

The ICMS rates vary on average from 7–19% by state in Brazil. Certain states create initiatives for particular industries by reducing ICMS rates on products. For example, Goias has a special incentive for manufacturing drugs and devices. In Manaus, in the Amazon region, there is a free trade zone filled with brand name manufacturers of electronic gear and motorcycles/scooters. The tax free merchandise is shipped down the river in road containers on barges (about 700 miles over three to four days). Payloads, especially for healthcare products, are often limited by insurance limits on the value of cargoes.

The value of goods and tax requirements are important considerations for managing transportation. The main freight bill document, the CTRC, includes extensive information on the value of merchandise, financial negotiation, the tax on freight charges and, yes, information on the shipper, consignee, weight, pieces, etc.

The transportation manager juggles it all to find the best solution. Along the way, he must get government approval for the shipment and two PODs – one on the CTRC and one for the accompanying invoice. India The major challenges in India include lack of highways between and within cities, over capacity ports and India’s famously cumbersome and large governmental bureaucracy. Traditional corruption complicates business and everyday life. However, GDP growth will be respectable again this year and India’s establishment is changing. This includes legislation implemented this year to make the goods and services tax (GST) more uniform across its states and eliminating inter-state check-posts. The new

GST regime has increased supply chain network efficiencies and reduced transit times by over 30%. It also diminishes the need for large shippers and 3PLs to have many small distribution centers in different states to avoid the once heavy GSTs incurred in moving products across states lines.

In addition, major highways are being built for the “golden quadrangle” that will connect the major cities and regions. The major areas are North Central based on New Delhi (population 27 million), the Western region with Mumbai (population 23 million), the nation’s economic center and major port as its hub, the Northeast around Kolkata (population 15 million) and the South including the key city of Bangalore (population 12 million) and the second largest port of Chennai (population 9 million). Traditionally, Colombo at the north tip of Sri Lanka has been a key port of call for major shipping lines. Much of the Indian East Coast container movement is reloaded to larger vessels there. In addition, Kolkata is a shallow water port and Chennai is over capacity. The Mumbai port is expanding to handle its current over capacity situation.

Most inland linehaul between major ports and markets is performed by container or trailer on flat car (COFC/TOFC). For truckers, operations are complicated nearly everywhere by lack and quality of the road network. China China’s “Belt and Road Initiative” (BRI) is driving significant logistics infrastructure spending in Asia and westward into Africa and Europe. The initiative is sometimes referred to as “One Belt, One Road.” “One Belt” refers to the Silk Road Economic Belt, while “One Road” refers to the 21st-century Maritime Silk Road initiative. Jointly, they are meant to be a revival of the ancient Silk Road trading routes. With China pledging at least $113 billion and external investors adding even more, China is leading the way in building and modernizing road transportation infrastructure, railways, and maritime routes and ports within Asia, the Middle East, Africa, and parts of Europe.

Figure 1. China’s “Belt and Road Initiative” (BRI)

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China’s Belt and Road Initiative

While BRI is uniting China with other countries, within China, its provinces exercise extensive authority over border crossings. Disruptions are normally based on licenses to operate. Having the right national and local governmental licenses is imperative. While you can have national authority to operate in China for warehousing and road transportation, you must have local licenses to bill and collect for services. DHL Supply Chain is a wholly-owned, national operation with local business licenses in 19 major cities. Specific hygiene licenses for food warehousing, co-packing and transport are held in Shanghai, Beijing and Guangzhou. Regional road transportation licenses are held for Beijing, Tianjin, Shanghai, Hefei and Suzhou. Obtaining the necessary licenses in China is doable, but requires working through tedious, bureaucratic challenges. Often you need to obtain a local business license and then a second local license for transport or special warehousing operations. Once issued, licenses are not transferrable.

Infrastructure challenges create opportunities for modern, sophisticated 3PLs. Most major, international companies find it expedient to let DB Schenker, UPS Supply Chain Solutions, or a similar 3PL address the problems and offer uniform solutions around the globe.

Global Logistics Costs and Third-Party Logistics Revenues

Armstrong and Associates, Inc. (A&A) has developed logistics cost and third-party logistics revenue estimates with projections through fiscal year 2022. Our overall and regional estimates are based upon individual estimates developed for 190 countries. The complete Global Logistics Costs and Third-Party Logistics Revenues tables are in Appendix A.

Global logistics costs have increased from $7.1 trillion in 2010 to $8.2 trillion in 2016.

Figure 2. Global Logistics Costs and Third-Party Logistics Revenues (US$ Billions)*

*Based on current U.S. dollars.

The global logistics cost decline in the chart above from 2014 to 2015 is primarily due to the U.S. dollar strengthening against other currencies and declining fuel costs.

Globally, modern industrially developed and post-industrial countries have the lowest relative logistics costs as a percent of GDP. For example, in 2016, North America’s logistics cost as a percent of GDP was 8.6% and Europe’s was 9.5%. Asia Pacific’s estimate was 12.7% and South America’s was 12.0%. This is a function of logistics (road/rail/port) infrastructure, the lifecycle deployment of leading logistics practices, and influence of ongoing process improvements including eliminating unnecessary governmental, bureaucratic obstacles.

Figure 3. 2016 Logistics Costs for Key Regions and Countries (US$ Billions)

For a single country, Greater China’s logistics cost (including Hong Kong, Taiwan, and Macao) is the highest in the world at $1.7 trillion and equivalent to more than half of the Asia Pacific region’s logistics cost. (In comparison, U.S. logistics cost is $1.5 trillion.) Globally, the Asia Pacific region (APAC) is the largest logistics market accounting for 39% of total global logistics costs and 38% of total global 3PL revenues.

Figure 4. 2016 Logistics Costs for Key Regions and Countries as a % of GDP

In terms of logistics cost as a percent of GDP, developing economies normally run 11–15%, and Greater China falls in line at 14.1%. The distribution of logistics cost percentages is similar to that for Logistics Performance Index (LPI) numbers developed by The World Bank.

Figure 5. Distribution of Logistics (GDP %), 3PL Revenue % and LPI

Figure 6. Logistics Cost Growth for Key Regions and Countries

Greater China and Asia Pacific (excluding Japan) are expected to be the fastest growing regions in terms of logistics cost from 2016 to 2022. This will primarily be driven by strong growth in private domestic consumption of general merchandise, including a range of fast-moving consumer goods for daily consumption, as well as luxury items. This growth reflects a number of factors including strong economic growth, encouraging demographics, sustained urbanization, and growth of the middle class.

Figure 7. GDP Growth for Key Regions and Countries

Third-Party Logistics Market

Logistics involves the movement and storage of goods between different locations from origin suppliers to intermediate points, and eventually to end users. In the logistics industry, third-party logistics providers generally focus on managing two primary service functions: 1.) transportation by different modes (ground, ocean, air, rail) and 2.) warehousing (storage, consolidation/deconsolidation, cross docking).

The breadth of value-added services and capabilities a third-party logistics provider can offer customers differentiates 3PLs from transactional transportation companies and basic warehousing operations. The table below includes some of the primary 3PL value-added services and capabilities. The major change since 1995 has been an increase in the complexity and clustering of these services. Several of the largest 3PLs (DHL Supply Chain & Global Forwarding, DB Schenker, Kuehne + Nagel, DSV, and UPS Supply Chain Solutions) offer a wide array of these services to their largest customers.

Table 2. Third-Party Logistics Value-Added Services

Both — 3PL/4PL Domestic and International Transportation Management 4PL/Lead Logistics Provider Cargo Insurance Call Centers Carrier Contracting/Brokering/Freight Payment Consolidation/Deconsolidation Customs Brokerage Consulting/Process Reengineering Duty Drawback Processing EDI Handling Freight Forwarding/NVOCC Exception Handling Incoterms Management — EXW to DDP Financial Services Letters of Credit/Negotiable BOLs Food Grade/Temperature Controlled Merge-In-Transit Hazmat Skills Multimodal Transportation ISO Certification Project Logistics Inventory/Vendor Management Transportation Execution Lean Management Skills Transportation Network Planning/Optimization Order Management Value-Added Warehousing & Distribution Pool Distribution/Cross Docking Bonded Facilities Radio Frequency/RFID Easily Deployable IT and Work Processes Security Processes Installation/Removal Sourcing/Procurement Skills JIT/Kanban Supply Chain Systems Kitting/Pick & Pack Light Manufacturing/Assembly Order Fulfillment Reverse Logistics Subassembly

The key competitive differentiators between 3PLs include supply chain management systems capabilities, operations process management skills, and logistics engineering expertise. Most tier-one 3PLs have implemented integrated systems platforms to support global transportation and warehouse management operations providing large customers with a “control tower” supply chain network management approach. These platforms offer internet visibility and exception handling capabilities combined with transportation management functionality for the daily management of orders, customer inventory, and the optimization of thousands of shipments across large geographical areas. The same 3PLs can run value-added warehousing operations, perform supply chain network analysis and design, and manage call center and fulfillment operations. Several 3PLs have expanded to have global scope for all services. Most often, global 3PL expansions have been through acquisitions. The following table provides a list of major deals.

Table 3. Select 3PL Acquisitions (US$ Millions)

Target Target EBIT* or Acquisition Purchase Acquirer Target Company Company Company EBIT EBITDA** Date Price Yearly Revenue or EBITDA Multiplier

100 cash/ C.H. Robinson Worldwide American Backhaulers 12/1999 280 13.0 10.5* 36 stock Exel Tibbett & Britten 12/2004 598 2,600 87.9 6.8** Welsch, Carson, Anderson & Stowe Ozburn-Hessey Logistics 8/17/05 396 302 43.0 9.2** Deutsche Bahn BAX Global 1/31/06 1,210 2,734 113.0 10.7* Ozburn-Hessey Logistics Barthco International 7/7/06 90 120 10.0 9.0* Oak Hill Capital Jacobson Companies 6/1/07 500 375 45.0 11.0** Apollo Management/CEVA EGL 7/2007 2,200 3,200 152.0 14.5** SNCF Geodis 7/1/08 1,735 7,043 181.0 9.6* Toll Holdings Express Logistics Group 10/23/09 45 113 5.6 8.0* Summit Logistics Toll Holdings 2/2/10 70.3 261 7.6 9.3** International GENCO Distribution System ATC Technology 7/2010 513 476 77.7 6.6** Ryder Total Logistic Control 12/31/10 200 250 36.0 7.0** Norbert Dentressangle TDG 3/2011 320 1,100 55.0 5.8** Exel Transportation Hub Group 4/4/11 83 717 4.0 20.8* Services/Mode Transportation Platinum Equity Caterpillar Logistics Services 5/11/12 700 660 60.0 11.0* XPO Logistics Turbo Logistics 10/24/12 50 124 6.2 8.0* C.H. Robinson Worldwide Phoenix International 11/1/12 635 807 50.8 12.5** Norbert Dentressangle Jacobson Companies 8/29/2014 750 800 76.0 9.8** XPO Logistics New Breed Holding 9/2/2014 615 597 77.0 8.0** C.H. Robinson Worldwide Freightquote.com 1/5/2015 365 623 34.0 10.7** FedEx GENCO 1/30/2015 2,000 1,600 208.0 9.8** Japan Post Holdings Toll Holdings 5/28/2015 5,069 6,872 554.0 9.1** Kintetsu World Express APL Logistics 5/29/2015 1,200 1,586 80.0 15.0** Echo Global Logistics Command Transportation 6/1/2015 420 561 37.0 11.4** XPO Logistics Norbert Dentressangle 6/8/2015 3,530 5,500 388.0 9.1** United Parcel Service Coyote Logistics 8/18/2015 1,800 2,100 120.0 15.0** 3,000 (includes XPO Logistics Con-way 10/30/2015 5,800 528.0 5.7** $290M of net debt) OHL (Ozburn-Hessey Geodis 11/3/2015 800 1,305 80.0 10.0** Logistics) DSV UTi Worldwide 1/22/2016 1,350 4,180 -- .34x Sales FedEx TNT Express 5/25/2016 4,924 6,674 205.2 24.0** HNA Group Ingram Micro 12/6/2016 6,000 43,026 378.0 15.9*

Sources: Primary, Company Information; Secondary, Armstrong & Associates, Inc. Estimates

International transportation management (freight forwarding and non-vessel operating common carrier (NVOCC)) and value-added warehousing and distribution are the key components of global third-party logistics.

International transportation management (ITM) 3PLs have a core competency in freight forwarding and often offer a host of additional value-added services. They traditionally act as intermediaries arranging for international and related domestic transportation between their customers and transportation providers. ITM 3PLs arrange and oversee all aspects of the transportation of products and materials, from origin to destination, by ground, ocean, air, and rail. An ITM 3PL will typically arrange to pick up goods from a shipper, consolidate shipments, procure transportation, and provide ancillary value- added services including preparation and submission of documentation, customs and other clearance processes, and often the warehousing and distribution of shipments. In addition, they will have systems for tracking and tracing shipments and automating processes with customs officials. Typically, ITM operations are non-asset based.

Value-added warehousing and distribution (VAWD) 3PLs manage customers warehousing and related transportation management needs. These services are typically performed under multi-year contract terms in which the 3PLs systems and staff take over responsibility of critical logistics functions. Responsibilities often include inventory management, optimizing warehousing operations, managing transportation routes and providers–whether inbound, outbound or dealing with aftermarket returns– kitting and sequencing unassembled parts, providing support during manufacturing, picking and packing finished goods, and providing quality control and other value-added services. Europeans tend to lump VAWD and the related outbound transportation into “contract logistics.” Traditionally, this 3PL segment is asset-based.

Figure 8. Key Drivers of 3PL Market Growth

Regulatory Compliance Low-Cost Country Off shoring and Sourcing Outsourced Mfg.

Increasing Supply Focus on Core Cost Reductions Chain Complexity Competencies

Supply Chain Expanding IT Disruptions Need Regional Requirements and Local Market Expertise

The initial focus of companies outsourcing functions to 3PLs was to reduce costs, gain operational efficiencies, and focus on core competencies in manufacturing. Starting in the early 1990s, there was a significant increase in offshoring of manufacturing operations and a shift from domestic supply chains with domestic logistics management needs to global supply chains with international logistics management needs. Doing business globally is more complex and requires increased regional and local market expertise in managing transportation and warehousing, and adhering to governmental regulations. These increases in supply chain complexity have driven many companies to engage the help of 3PLs as logistics and regulatory specialists. In turn, 3PLs with expertise in international transportation management and warehousing and distribution are providing economies with the operational “backbone” supporting global trade.

3PL Revenue and Growth Rates Analysis

Figure 9. 2016 3PL Revenue for Key Regions and Countries (US$ Billions)

Europe is coming out of economic austerity driven recession. Except for countries north of the Alps such as Germany, Norway and the Netherlands, Europe continues to have low financial growth. Based upon its 2016 regional revenue, we estimate that 3PLs operating in the Europe region have penetrated ~25% of the total potential market, so the trend to outsource logistics functions to 3PLs continues to provide for growth over and above the overall economy. The best Europe-based 3PLs have made acquisitions to globalize their operations and participate in developing markets with higher rates of growth.

North America is benefiting from an improving U.S. economy with increasing manufacturing levels, the nearshoring of some manufacturing to Mexico, and newly addressable oil and gas operations in Canada and the U.S. Consumers in the U.S. bounced back from the great recession of 2009 and started to spend more especially on large ticket items. All of these factors are driving an improved 3PL market.

Figure 10. 3PL Revenue Growth for Key Regions and Countries

The geographic region with the highest 3PL revenue spend and the highest 3PL growth rates is APAC, where growth has traditionally been driven by companies outsourcing or offshoring manufacturing to lower cost countries. While this trend still continues in Myanmar, Malaysia, Indonesia, Vietnam, Cambodia, and to a lesser extent in China, Thailand, the Philippines, and Singapore, increasing domestic consumption and demand for products are driving the modernization of distribution networks in the Asia Pacific region. This is being supported by China’s “Belt and Road initiative” which is driving significant infrastructure spending across Asia and westward. The emphasis is shifting away from export trade and ocean or air freight forwarding to intra-regional ground distribution and cross-border e-commerce. 3PLs providing value-added warehousing and distribution services in these countries are experiencing significant growth.

Figure 11. 2016 Asia Pacific 3PL Revenue Percentage by Country

The chart above provides the 3PL revenue breakdown by Asia Pacific countries in 2016. As demonstrated, China accounts for 54.7% of all Asia Pacific 3PL revenues.

Our estimate of 3PL penetration of the total potential U.S. 3PL market is ~24%, up from 10% in 2002. This compares to current 3PL market penetration rates of ~25% in Europe and only 17% in China. As a result, the underlying structural market dynamics are good and will support the trend for continued outsourcing to 3PLs in Asia. In combination with its above-average economic growth, we anticipate Asia to continue to realize above-average growth rates for third-party logistics with much of the growth being intra-China and intra-Asia.

Major Region 3PL Market Growth Trends

Figure 12. 3PL Revenues by Major Geographic Region (US$ Billions)

In 2016, the Asia Pacific 3PL market, at $305 billion, was 53% larger than the North American 3PL market. We estimate that it will surpass $480 billion in 2022. When we look at regions for future 3PL market growth through 2022, the chart above highlights the Asia Pacific with a projected above-average compound annual growth rate (CAGR) of 6.8% from 2010 through 2022E.

Figure 13. VAWD Revenues by Major Geographic Region (US$ Billions)

Within the specific 3PL market segment of value-added warehousing and distribution (VAWD), the Asia Pacific VAWD market grew to $77.4 billion in 2016 and will surpass $120 billion in 2022. With increased regional and interregional consumer demand for goods, VAWD is the fastest growing 3PL segment within the Asia Pacific. Segment growth through 2022 has the Asia Pacific with a projected above- average CAGR of 7.1% from 2010 through 2022E.

Figure 14. ITM Revenues by Major Geographic Region (US$ Billions)

International transportation management (ITM) is the 3PL segment focused on freight forwarding activities from the point of origin to the point of delivery. It often includes significant pieces of domestic ground transportation in conjunction with international air or ocean freight moves.

In the Asia Pacific, ITM grew to $90 billion in 2016 and will surpass $120 billion in 2022. Even with more recent moderate growth in exports from Asia to the U.S. and Europe, ITM in the Asia Pacific has a projected above-average CAGR of 3.7% from 2010 through 2022E.

Figure 15. Total and Segment Third-Party Logistics Global Revenues (US$ Billions)

Our estimate of 2016 3PL revenues from the Global Fortune 500 is $273.8 billion, a 27.8% increase over 2010. For 2016, these companies accounted for 34.1% of the $802.2 billion global 3PL market.

In the Asia Pacific, third-party logistics has had a CAGR of 3.8% over the last five years. Throughout the 1990s and early 2000s, the growth tended to be ITM (freight forwarding and NVOCC) focused. However, in the last five years there has been increased focus on domestic distribution (VAWD) to address consumer spending growth and the resultant demand for goods in developing countries including China, Indonesia, India, Singapore, and Thailand.

Figure 16. 3PL Revenues by Industry for the Fortune 500 Global (US$ Billions)

Table 4. Compound Annual Growth Rates by Industry for the Fortune 500 Global

2010-2016 2010-2018E Major Industry CAGR CAGR Healthcare 7.2% 6.4% Industrial 6.3% 5.4% Technological 5.2% 4.9% Retailing 5.2% 5.0% Food, Groceries 4.9% 4.5% Automotive 4.2% 3.7% Other 3.3% 3.2% Consumer Goods 1.2% 1.5% Elements -1.1% -0.4%

In preparation for an upcoming global e-commerce 3PL report, we have been analyzing e-commerce’s impact on the third-party logistics market. 3PL revenues from e-commerce activity are growing faster than the overall 3PL market. Of the $802.2 billion of total 3PL revenues globally, e-commerce related revenues are expected to grow from $40.6 billion in 2016 to $72.8 billion in 2020, making up 5.1% and 7.2% of total 3PL revenues, respectively. E-commerce 3PL business is generating a compound annual growth rate of 15.7% versus overall 3PL market growth of 6.0% for the same period.

Asia has seen the greatest growth in e-commerce revenues due to expanding consumer spending and cross-border purchasing. In 2016, Asia Pacific e-commerce customers spent $22.0 billion with 3PLs. Revenues are expected to grow at a CAGR of 16.4% to reach $40.2 billion in 2020. China boasts the largest Asia Pacific e-commerce 3PL spend with $17.0 billion, a figure expected to continue growing at 16.3% annually through 2020.

Even with the dominating e-retail effect of Amazon in the U.S., 3PLs are seeing significant e-commerce- driven growth. In 2016, U.S. e-commerce customers spent $8.7 billion with 3PLs. Revenues are expected to grow at a CAGR of 19.1% to reach $17.6 billion in 2020. In 2020, e-commerce will account for 8.5% of U.S. 3PL market revenue, up from 5.2% in 2016.

Table 5. E-Commerce Logistics Costs, 3PL Revenue, and Growth Rates (US$ Billions)

E-Commerce Logistics Costs E-Commerce 3PL Revenue CAGR E-Commerce E-Commerce E-Commerce E-Commerce E-Commerce E-Commerce Logistics Costs 3PL Revenue Country/Region* Logistics Costs Logistics Costs 3PL Revenue 3PL Revenue CAGR CAGR 2016 2020E 2016 2020E 2016-2020E 2016-2020E Asia Pacific $ 215.4 $ 406.4 $ 22.0 $ 40.2 17.2% 16.4% China $ 165.9 $ 311.5 $ 17.0 $ 31.2 17.1% 16.3% North America $ 87.0 $ 179.4 $ 9.5 $ 19.1 19.8% 19.1% U.S. $ 79.7 $ 164.9 $ 8.7 $ 17.6 19.9% 19.1% Europe $ 75.8 $ 107.7 $ 8.0 $ 11.3 9.2% 9.2% South America $ 6.8 $ 12.1 $ 0.6 $ 1.1 15.5% 15.5% CIS/Russia $ 5.1 $ 9.0 $ 0.4 $ 0.7 15.3% 15.2% Middle East $ 2.1 $ 4.0 $ 0.2 $ 0.4 17.1% 17.1% Grand Total $ 392.2 $ 718.7 $ 40.6 $ 72.8 16.3% 15.7%

*Includes countries with $500 million or more in 2020E e-commerce logistics costs; included countries represent 87% of global GDP and ~98% of 2016 global e-commerce sales.

Major Players in Third-Party Logistics

Table 6. Top 50 Global 3PLs Ranked by 2016 Gross Logistics Revenue (US$ Millions)*

Country Gross Rank Provider Headquarters Revenue

1 DHL Supply Chain & Global Forwarding Germany 26,105 2 Kuehne + Nagel Switzerland 20,294 3 Nippon Express Japan 16,976 4 DB Schenker Germany 16,746 5 C.H. Robinson United States 13,144 6 DSV Denmark 10,073 7 XPO Logistics United States 8,638 8 Sinotrans China 7,046 9 GEODIS France 6,830 10 UPS Supply Chain Solutions United States 6,793 11 CEVA Logistics Netherlands 6,646 12 DACHSER Germany 6,320 13 Hitachi Transport System Japan 6,273 14 J.B. Hunt (JBI, DCS & ICS) United States 6,181 15 Expeditors United States 6,098 16 Toll Group Australia 5,822 17 Panalpina Switzerland 5,276 18 GEFCO France 4,800 19 Bolloré Logistics France 4,670 20 Kintetsu World Express Japan 4,373 21 Yusen Logistics Japan 4,169 22 CJ Logistics South Korea 3,808 23 Burris Logistics United States 3,629 24 Agility Kuwait 3,576 25 Hub Group United States 3,573 26 Hellmann Worldwide Logistics Germany 3,443 27 IMPERIAL Logistics South Africa 3,352 28 Kerry Logistics Hong Kong 3,097 FedEx Trade Networks/FedEx SupplyChain Systems/ 29 United States 2,916 FedEx Supply Chain 30 Ryder Supply Chain Solutions United States 2,659 31 Damco Netherlands 2,500 32 Coyote Logistics United States 2,360 33 Total Quality Logistics United States 2,321

*Revenues are company reported or Armstrong & Associates, Inc. estimates and have been converted to US$ using the average annual exchange rate in order to make non-currency related growth comparisons.

Table 6. Top 50 Global 3PLs Ranked by 2016 Gross Logistics Revenue (US$ Millions), Continued*

Country Gross Rank Provider Headquarters Revenue

34 Sankyu Japan 2,275 35 Schneider National Logistics & Dedicated United States 2,063 36 Echo Global Logistics United States 1,716 37 Transportation Insight United States 1,710 38 NNR Global Logistics Japan 1,676 39 Landstar United States 1,632 40 Mainfreight New Zealand 1,627 41 APL Logistics Singapore 1,620 41 Transplace United States 1,620 42 arvato Germany 1,615 43 Americold United States 1,555 44 Fiege Logistik Germany 1,550 45 Wincanton United Kingdom 1,516 46 Penske Logistics United States 1,500 47 Swift Transportation United States 1,431 48 Groupe CAT France 1,328 49 NFI United States 1,250

Figure 17. Distribution of the Top 50 Global 3PLs by Country Headquarters (Number of 3PLs, Percent of Total)

Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions)*

Gross Ocean Air Metric Provider A&A Provider Information and Commentary Rank Revenue TEUs Tons

DHL Supply Chain & Global Forwarding is the world's largest 3PL and contract logistician. Revenues for DHL Supply Chain North America (formerly Exel) are $4.2 billion with 673 locations and 119 million square feet of space. DHL Global Forwarding DHL Supply (DGF) maintains more than 31 global carrier partners with contracts on a multitude of 1 Chain & Global 26,105 3,059,000 2,081,000 trade lanes and more than 330 gateway facilities. Its annual volume is 3 million TEUs Forwarding (20' Container/Trailer Equivalent Units) and its LCL (Less Than Container Load) is 2 million cubic meters. There are more than 45,000 weekly point pairs for LCL globally. DGF handles 2 million shipments annually. DHL's scope allows its customers to more easily adjust vendor supply chains.

Kuehne + Nagel is one of the world's leading logistics companies providing services at more than 1,300 locations in over 100 countries. It has strong market positions in the sea freight, air freight, contract logistics and overland businesses. Americas business for Kuehne + Nagel is 19% of net revenues. In 2015 and 2016, Kuehne + Nagel's U.S. net revenues and profitability grew despite lowered international trade and currency issues. Sea freight and air freight business units led the way. In both areas, high internal 2 Kuehne + Nagel 20,294 4,053,000 1,304,000 productivity and strict cost management utilizing good investments made in technology and product development strengthened niche segments. Leveraging its forwarding and contract logistics capabilities, Kuehne + Nagel has built good global spare parts logistics and cold chain/pharmaceutical capabilities. It has full IATA (International Air Transport Association) CEIV Pharma (Center of Excellence for Independent Validators in Pharmaceutical Logistics) network certification of its entire global KN PharmaChain GxP compliant air network, which includes 86 locations covering all continents.

DB Schenker's German operations, including Europe’s largest rail freight and trucking operations, are over 70% of total revenues. DB Schenker’s European trucking operation has about 24,000 employees/owner-operators and handles about 100 million shipments a year. Its Russian and Eastern European operations are substantial. DB Schenker's European land transport division accounts for 42% of the business, followed by its 3 DB Schenker 16,746 2,006,000 1,179,000 freight forwarding unit at 41% and contract logistics accounts for the rest. Its North American contract logistics operations are 42% Consumer Goods, 30% High-Tech, 16% Industrial and 12% Automotive. In February 2017, DB Schenker bought a $25 million stake in online freight booking platform uShip Inc. and acquired a seat on the uShip board. The company is actively seeking other acquisitions in the U.S. freight market.

DSV is primarily a non-asset operation. About 40% of its operations are European over- the-road, its Air & Sea division makes up about 46% and Solutions (logistics) accounts for the rest. In January 2016, DSV acquired global supply chain manager and freight forwarder, UTi Worldwide, for $1.35 billion. The geographical match is good. The DSV Group is now Denmark’s largest supplier of transport and logistics services. The Group 4 DSV 10,073 1,305,594 574,644 originates in the Nordic countries but has established its own operations in more than 80 countries. The EMEA (Europe, the Middle East and Africa) region accounts for 69% of the business, APAC is 14% and the Americas account for the rest. Via professional and advantageous overall solutions, a worldwide yearly turnover of more than $10 billion is realized by the Group’s 45,000 employees.

*Revenues and freight forwarding volumes are company reported or Armstrong & Associates, Inc. estimates and have been converted to US$ using the average annual exchange rate in order to make non-currency related growth comparisons. Freight forwarders are ranked using a combined overall average based on their individual rankings for gross revenue, ocean TEUs and air metric tons. ©2017 Armstrong & Associates 27 Major Players

Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions), (Cont.)*

Gross Ocean Air Metric Provider A&A Provider Information and Commentary Rank Revenue TEUs Tons

Sinotrans' core services are freight forwarding and shipping agency services with support services such as storage and terminal services, marine transportation, trucking and express. Freight forwarding is three-fourths of the business. In 2016, Sinotrans handled over 10 million sea freight forwarding TEUs (includes NVOCC, booking agent and custom broker activities), 532,400 metric tons of air freight and 23.2 million international express documents/packages. Sinotrans is a joint stock limited company 5 Sinotrans 7,046 2,950,800 532,400 incorporated in the People’s Republic of China. The Company was listed successfully on The Stock Exchange of Hong Kong Limited on February 13, 2003. For many years, Sinotrans was completely protected by People’s Republic of China law from direct foreign competition. At the end of 2015, China Merchants Group (CMG) acquired Sinotrans and CSC Holdings Co. which had been controlled by the State-Owned Assets Supervision Administration Commission.

Panalpina is a top 10 freight forwarder. It handles about 1.5 million ocean TEUs, more than 920,000 metric tons of air freight and about 1 million tons of non-containerized break bulk cargo annually. Panalpina continues to expand its LCL network. Automotive and Manufacturing account for almost 30% of its LCL volumes, followed by Consumer, Retail and Fashion at 25%, and High-Tech and Telecom at 20%. Its busiest LCL trade lane is China to Southeast Asia. Its warehousing footprint, including subcontracted space, totals 242 warehouses encompassing 22.3 million square feet of space in 150 countries. Of its total warehousing footprint, 12.9 million square feet and 160 warehouses are managed by Panalpina. Panalpina concentrates on nine verticals/segments: Automotive, Chemicals, Consumer Retail, Fashion, Healthcare, 6 Panalpina 5,276 1,488,500 921,400 High-Tech, Manufacturing, Oil & Gas, and Telecommunications. Its Oil & Gas operations are primarily in project logistics, which has accounted for 10% to 15% of Panalpina's revenues. In 2016, Panalpina's forwarding revenue fell 11.3% and gross profit slumped by 3.3%. Although its ocean freight volumes were down 7% over 2015, its air freight volumes grew over 10% to 921,400. Contract logistics was down 5.8% partly due to shedding unprofitable accounts. Panalpina, like other Europe-based freight forwarders, was affected by currency adjustments related to the strong U.S. dollar and the general malaise surrounding international trade. Also, cheaper fuel prices have impacted gross revenues and pinched Panalpina's Oil & Gas project logistics activity. Perishables logistics has been an increasing area of focus for Panalpina.

Nippon Express covers Japan. It’s Japan’s largest domestic transportation company. About 80% of Nippon's revenues are from its domestic Japanese operations. Its international operations in forwarding and contract logistics are tied to its Japanese base. In addition to truck-based operations, Nippon provides harbor and ship transportation, air and ocean freight forwarding and warehousing. In January 2014, 7 Nippon Express 16,976 550,000 705,478 Nippon Express completed the acquisition of Panasonic Logistics Co., Ltd., the wholly owned logistics arm of Japanese multinational electronics giant Panasonic Corp. In December 2013, Nippon acquired a 49% stake in NEC Logistics, the wholly owned logistics arm of NEC Corp., another major Japanese electronics maker. A year later an additional 2% was acquired making Nippon the majority stockholder.

Expeditors is the largest North America-based freight forwarder. 2016 net revenues were $2.2 billion and produced a gross margin of 35%. Net revenues were down 1% and operating income fell 7% versus 2015. Net revenues are 32% Air Freight, 25% Ocean Freight and 43% Customs Brokerage. By industry, Expeditors' net revenues run 8 Expeditors 6,098 1,044,116 875,914 40% High-Tech, 33% Retail, 10% Pharmaceuticals, 10% Automotive, 5% Furniture and 2% Other. 2016 gross revenues decreased 10% for air freight and 13% for ocean freight. U.S. and Asia business account for 75% of revenues. Expeditors is the largest forwarder/NVOCC in the Asia/U.S. lane. Expeditors limits its participation in value- added warehousing and distribution.

Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions), (Cont.)*

Gross Ocean Air Metric Provider A&A Provider Information and Commentary Rank Revenue TEUs Tons

UPS is an 800 lb. gorilla of global supply chain services. Revenues for contract logistics were $1 billion in 2016. UPS SCS contributes $3 billion+ per year in package business to its big brother. Twelve percent of UPS containers are LCL consolidations; 40% are Asia-U.S. Forwarding revenues are 60% air and 40% ocean. UPS has 300 licensed customs brokers. UPS has redesigned its supply chain operations to concentrate on UPS Supply 9 6,793 600,000 935,300 high-tech, healthcare and some retail/consumer goods customers. These operations Chain Solutions are highly integrated between value-added and package delivery services. UPS has expanded quickly in the healthcare/medical space including the 2015 opening of a new multi-client facility in New Jersey for handling medical devices and a new healthcare facility in Amsterdam. UPS also made a major move into the U.S. DTM/freight brokerage space with the acquisition of Coyote Logistics in August 2015.

CEVA Logistics is one of the world's largest logistics companies and has been the world’s largest automotive 3PL. It has a heavy emphasis on manufacturing and is expanding operations in other sectors. CEVA's industry sectors are Automotive 25%, Consumer and Retail 26%, Technology 18%, Industrial and Aerospace 21%, Energy 4%, Healthcare 5% and Other 1%. CEVA services 160 countries. Its core services 10 CEVA Logistics 6,646 681,600 421,800 include fulfillment centers, high-velocity cross-docks, subassembly, sequencing, dedicated contract transportation, and network designs/redesigns. Its revenue is split between Contract Logistics (55%) and Freight Management (45%). The Americas account for 35% of its revenues, Asia Pacific 24%, and Europe 41%. Fiat is CEVA's largest customer.

GEODIS is France's largest provider of transportation and logistics services and is one of the top European 3PLs. The GEODIS Group covers more than 120 countries worldwide through its network partners and subsidiaries including GEODIS Logistics, GEODIS Wilson, and GEODIS Supply Chain Optimisation (which grew out of its December 2008 acquisition of IBM’s internal global logistics operations). Most of the 10 GEODIS 6,830 690,000 330,000 Group’s revenue is Europe-based with France accounting for 44%. In August 2015, GEODIS acquired U.S.-based, value-added warehousing and distribution 3PL, OHL. OHL is a case study in the transition from a 1950s regional, privately-owned, public warehousing company to part of major European 3PL GEODIS today. The combination will make a strong international solutions provider.

The Bolloré Group combined its transport and logistics businesses under the same brand: Bolloré Transport & Logistics. Bolloré Transport & Logistics has four business units. Bolloré Logistics (formerly SDV), a France-based freight forwarder and 3PL, accounts for 77% of the Transport & Logistics unit. Bolloré Ports, a leading port operator in Africa, Bolloré Railways, a major operator of rail concessions in Africa, and Bolloré Bolloré Energy, a heating oil distributor in France, makes up the remainder of the Transport & 11 4,670 856,000 569,000 Logistics Logistics unit. Bolloré Logistics' industry sector breakdown is: Industrial/Manufacturing 35%, Consumer/Retail 20%, Oil & Gas/Mining 17%, Aerospace/Defense 11%, High- Tech/Telecom 10% and Healthcare/Aid & Relief 7%. Bolloré Logistics is ranked #1 in France by the IATA. It has 602 offices in 105 countries with a large footprint in Europe, Africa, Asia and the Americas. Bolloré Logistics USA has 15 branches in major U.S. cities and 475 employees.

Hellmann Worldwide Logistics is a privately-held German company which continues to be competitive against the big guys. It has good freight forwarding and contract logistics operations. Air and sea freight are about half of the business. Coverage in Asia and Hellmann China is extensive. Its regional breakdown is Europe 58%, Asia 13%, the Americas 12 Worldwide 3,443 902,260 576,225 19%, and Oceania, Middle East and Africa 10%. Hellmann's IT systems are dated. The Logistics quality of management is variable. In October 2016, it was announced that Klaus Hellmann will transition from his role as managing director to Hellmann's newly created supervisory board which was established in part to prepare Hellmann for a generational transition and to modernize the business. *Revenues and freight forwarding volumes are company reported or Armstrong & Associates, Inc. estimates and have been converted to US$ using the average annual exchange rate in order to make non-currency related growth comparisons. Freight forwarders are ranked using a combined overall average based on their individual rankings for gross revenue, ocean TEUs and air metric tons. ©2017 Armstrong & Associates 29 Major Players

Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions), (Cont.)*

Gross Ocean Air Metric Provider A&A Provider Information and Commentary Rank Revenue TEUs Tons Kintetsu World Express' (KWE) largest operations within its global network are in Japan and China, with over 100 offices located in each of those countries. About 33% of its business is air freight based. Ocean freight and logistics account for about 60%. Its primary verticals are high-tech, automotive, and healthcare. KWE has a host of strategic Kintetsu World 13 4,373 556,640 495,947 joint ventures and affiliated companies. Japan generates 23% of the business, the rest Express of Asia and Oceania generate 25%, the Americas account for 9%, APL Logistics (acquired in May 2015) is 37%, and EMEA make up the rest. Globally, KWE has 15.6 million square feet of warehousing space in 209 facilities, and APL Logistics has 15.7 million square feet of warehousing space in 202 facilities. Yusen Logistics does not have the kind of strong domestic base in Japan that characterizes Nippon and others. It has aggressively grown international markets and expanded through organic growth and acquisitions. Contract logistics and distribution are strong in Europe. In the Americas, a broad suite of logistics services are offered. 14 Yusen Logistics 4,169 633,056 332,389 Automotive, industrial and retail/consumer goods verticals are emphasized. Its automotive logistics includes roll-on/roll-off, JIT and parts distribution. Yusen has expanded its pharmaceutical business and continues to grow in Asia. Yusen's business by region is Japan 17%, Americas 24%, Europe 22%, East Asia 18% and South Asia & Oceania 19%. Kerry Logistics' business portfolio encompasses contract logistics, international freight forwarding, warehousing, transportation, distribution, trading, merchandising and a wide variety of value-added services and is now managing 46 million square feet of warehouse space, logistics centers and port facilities globally. Hong Kong and the PRC combined generate nearly 50% of revenues. Its business is split about 50/50 between 14 Kerry Logistics 3,097 1,055,600 282,200 its Integrated Logistics division, mainly value-added warehousing and distribution, and its International Freight Forwarding division. Kerry Logistics has acquired several freight forwarders in recent months expanding internationally in countries such as Spain, Italy, Germany and the U.S. Its recent joint venture with Dubai-based freight forwarder, Globalink Logistics DWC LLC, expands Kerry Logistics’ coverage in Central Asia and the CIS region. DACHSER handled 80 million shipments in 2016. Its largest business segment, Road Logistics, which includes European and Food Logistics, accounts for 75% of its revenues. Its other business segment, Air & Sea Logistics, accounts for the remainder of its revenues. Ocean TEUs shown include LCL shipments. DACHSER has 15 DACHSER 6,320 481,400** 272,100 subsidiaries in 42 countries. In the U.S., DACHSER has 13 offices in major cities, five warehouses with over 350,000 square feet of space in the cities of Memphis, Chicago, Atlanta, Miami and Charlotte, and generates about $200 million in revenue annually. DACHSER tends to be more modern and aggressive than many of its competitors. C.H. Robinson dominates domestic transportation management in North America. While the majority of Robinson’s net revenues are truck transportation related, it has solid domestic intermodal, international air and ocean, food sourcing and supply chain management skills. C.H. Robinson's TMC operations focus on large transportation network management. The TMC serves the Americas, Europe and Asia. European operations have been successful, profitable and expanding in Poland and the Eastern Bloc. They are a natural fit for Europe’s atomized owner-operator based companies. In 2009, C.H. Robinson added to its cross border capabilities by acquiring Laredo, Texas 16 C.H. Robinson 13,144 485,000 115,000 based International Trade & Commerce, Inc. (ITC). Today, C.H. Robinson manages over 500,000 cross-border truckload shipments per year. Approximately 70% of the truckloads managed are northbound loads with the most frequent modes utilized being dry van, flatbed, and refrigerated. C.H. Robinson’s 2012 acquisition of $635 million Phoenix International marked its largest acquisition and greatly expanded its international transportation management capabilities. C.H. Robinson manages 485,000 ocean TEUs and 115,000 air freight metric tons annually. For its U.S. customs brokerage operations, C.H. Robinson has 98 licensed U.S. customs brokers working in 13 different U.S. offices.

Table 7. Top 25 Global Freight Forwarders Ranked by 2016 Gross Logistics Revenue and Forwarding Volumes, (US$ Millions), (Cont.)*

Gross Ocean Air Metric Provider A&A Provider Information and Commentary Rank Revenue TEUs Tons Agility is a Middle Eastern leader in integrated supply chain solutions and is organized into two major business groups. Global Integrated Logistics (GIL) is the largest generating approximately 90% of Agility’s total revenues. It has core competencies in 17 Agility 3,576 513,500 372,700 freight forwarding, contract logistics/warehousing, project logistics, fairs & events, and supply chain management 3PL services. Agility provides 3PL services tailored to governments, relief agencies and international institutions worldwide. Agility is strong in emerging markets. Hitachi Transport System (HTS) was established in 1950 after Hitachi Ltd. spun off its in- house logistics department to form a separate distribution subsidiary. Today, as a major shareholder, Hitachi Ltd. accounts for about 20% of HTS' revenues. Based in Japan, Hitachi Domestic Logistics services are nearly 70% of the business. The Asia Pacific, Europe 18 Transport 6,273 430,000 230,000 and North America are the other key regions served. Hitachi Transport System consists System of 118 companies and 776 locations, including both offices and warehouses. It has 76.1 million square feet of warehouse space, with its major distribution centers located primarily in Japan. Toll’s revenues are two-thirds Australia based where Toll has one of everything in logistics. Toll’s mission is to be the most successful provider of integrated solutions to the Asian region providing customers with global reach. Through acquisitions, Toll has 19 Toll Group 5,822 542,000 114,000 expanded in Singapore/Southeast Asia, China and U.S./Europe freight forwarding. Its largest vertical industry is Retail/Food & Beverage at 32% of total revenues. On May 28, 2015, Toll officially became a division of Japan Post after its $5.1 billion acquisition of Toll. Damco is a third-party logistics provider specializing in customized freight forwarding and supply chain solutions. The company has more than 11,000 employees in over 300 offices across 100 countries and agents in 30 more countries. Damco's revenues slumped in Q4 2014. Losses continued into 2015 and were complicated by technology 20 Damco 2,500 659,000 190,000 systems issues. Parent company, Maersk, was forced to inject $451 million into Damco to keep it afloat. In 2016, Damco's net turnover fell to $2.5 billion (versus $2.74 billion in 2015), ocean TEUs managed dropped to 659,000 and air freight metric tons handled grew to 190,000. XPO Logistics is the fastest growing and most acquisitive providers of transportation logistics services in North America. In June 2015, XPO Logistics acquired major European transport and logistics provider Norbert Dentressangle for $3.5 billion. In October 2015, XPO Logistics acquired major trucking and logistics services provider Con-way for $3 billion. Menlo Logistics was included in this deal. XPO has two business 21 XPO Logistics 8,638 131,500 72,300 units: Transportation and Logistics. Transportation includes freight brokerage, last mile, global forwarding, less-than-truckload and truckload. Transportation is its largest business unit at approximately 65% of the business. Logistics, its value-added warehousing and distribution business unit, was formed from its September 2014 acquisition of New Breed Logistics. XPO Logistics has made more than a dozen acquisitions since its inception. Logwin has two business segments: Solutions (contract logistics), which is 37% of the business, and Air + Ocean, which is 63%. It has 190 branches in 35 countries. About 22 Logwin 1,095 600,000 140,000 63% of its revenue is Germany and Austria based. The Asia Pacific region accounts for 24%. Logwin has subsidiaries for automotive, fashion/lifestyle/media and furniture. NNR Global Logistics is one of six business segments of Japan's Nishi-Nippon Railroad Co., Ltd. It started out in the air cargo handing business in 1948. Today, its primary services include international air and ocean freight forwarding, customs brokerage, and inland transportation services. It handles over 285,000 metric tons of air freight and NNR Global 23 1,676 146,278 286,897 145,000 ocean TEUs annually. Semiconductors, electronics and electronic components, Logistics telecommunications equipment, and chemicals and other dangerous goods are the primary commodities handled. It has five logistics centers in Japan and is TAPA (Transported Asset Protection Association) Class A certified. Its warehousing footprint includes the 3PL distribution operations of its parent company.

Table 8. Top 25 Global VAWD 3PLs Ranked by 2016 Warehouse Space (Millions of Square Feet)*

Rank Provider Warehouse Space

1 DHL Supply Chain & Global Forwarding 248.0 2 Amazon.com (if it was counted as a 3PL) 159.9** 3 XPO Logistics 157.5 4 Kuehne + Nagel 107.9 5 Nippon Express 97.1 6 CEVA Logistics 86.1 6 DB Schenker 86.1 7 Hitachi Transport System 76.1 8 GEODIS 70.0 9 ID Logistics Group 53.8 10 DSV 50.0 11 Kerry Logistics 46.0 12 Ryder Supply Chain Solutions 44.0 13 FedEx Trade Networks/FedEx Supply Chain Systems/FedEx Supply Chain 40.0 13 Americold 40.0 14 FM Logistic 35.7 15 CJ Logistics 34.0 16 NFI 33.5 17 Sinotrans 33.4 18 Toll Group 32.3 19 UPS Supply Chain Solutions 32.2 20 Fiege Logistik 29.0 21 BCUBE 28.9 22 Kenco Logistic Services 28.0 23 Lineage Logistics 26.0

*Square footage is company reported or Armstrong & Associates, Inc. estimates. **Fulfillment, data centers, other

Global Logistics Costs by Mode or Function

In 1973, Heskett, Glaskowsky and Ivie1 explained a model for analyzing U.S. logistics costs. The model separated logistics management, inventory holding and movement (transportation) costs. Robert Delaney expanded the model and published a “State of Logistics Report” annually for 15 years until his death in 2004.

Delaney was assisted in his efforts by Roslyn Wilson. Wilson continued to publish the report annually under the sponsorship of the Council of Supply Chain Management Professionals, until the CSCMP recently selected consulting company A.T. Kearney to develop the report.

Donald Bowersox and his colleagues at Michigan State University worked extensively on logistics in the 1980s and 1990s. Their efforts included an algorithmic computer program to estimate logistics costs for countries other than the U.S.

More recently, Datamonitor, a United Kingdom-based consulting firm has developed country by country logistics cost information. Datamonitor relies on individual governmental country reports. Datamonitor’s information is privately held and expensive. A&A’s experience is that it underestimates costs for many countries due to systematic underreporting.

Similarly, A&A has found results published by the European Union (Eurostat) to involve poor reporting and lacking in timeliness.

A&A’s estimates for logistics costs by country, area and region are based on governmental reports from reliable, advanced economies, 3PL adaption/outsourcing rates, GDP, logistics infrastructure growth, and global trade estimates. Our approach is to isolate total logistics costs and then subdivide them by mode based on the best available information.

Figure 18. 2016 Trucking and Total Logistics Costs for Key Regions and Countries (US$ Billions)

1 Business Logistics, Ronald Press Co., New York, 1973

By mode, larger countries like the U.S. and China have opted for highway-based trucking solutions. Door-to-door flexibility of service is the key to trucking success globally. Countries which interfere with trucking activities (Saudi Arabia, Brazil, etc.) pay a significant price in increased logistics costs and economic competitiveness. Rail, domestic water-based transportation and air freight are all important specializations within countries, but secondary to trucking in general.

Figure 19. 2016 Inventory Carrying and Warehousing Costs for Key Regions and Countries (US$ Billions)

Inventory carrying is the second highest logistics costs category. The constant challenge for logisticians is to use transportation and warehousing location/efficiency to satisfy customers, while minimizing inventory costs.

Optimizing supply chains effectively requires modern companies to carefully manage inventory and select timely, cost-effective transportation.

Another important element to remember is that warehousing costs are the tail of the logistics dog. For the U.S., warehousing costs are 15% of transportation costs. Globally, warehousing costs are 18% of transportation costs. In our consulting practice, we have seen companies lose track of the transportation → inventory carrying → warehousing costs rank order. As a result, they tend to carry excessive inventory and diminish supply chain visibility.

Appendix A: Global Logistics Costs and Third-Party Logistics Revenues 2010-2022E

Table 9. 2010-2011 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions)

2010 2011

2010 Logistics 2010 3PL 2010 ITM 2010 VAWD 2010 TM 2011 Logistics 2011 3PL 2011 ITM 2011 VAWD 2011 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Algeria 26.6 2.0 0.7 0.5 0.8 32.9 2.5 0.9 0.6 1.0 Egypt 34.0 2.8 1.0 0.7 1.1 36.7 3.0 1.0 0.8 1.2 Morocco 14.0 1.1 0.4 0.3 0.4 15.2 1.2 0.4 0.3 0.5 Nigeria 59.4 4.2 1.5 1.0 1.7 66.7 4.7 1.6 1.2 1.9 South Africa 40.9 4.1 1.5 1.0 1.6 45.4 4.5 1.6 1.1 1.8 Sudan 11.4 0.8 0.3 0.2 0.3 11.7 0.8 0.3 0.2 0.3 Africa-Others 124.3 8.8 2.8 1.5 4.5 132.7 9.6 3.1 2.7 3.8 Africa Total 310.6 23.8 8.2 5.2 10.4 341.3 26.3 8.9 6.9 10.5 Australia 107.5 11.0 3.9 2.7 4.3 129.4 13.2 4.6 3.4 5.1 Bangladesh 19.0 1.5 0.5 0.4 0.6 20.4 1.6 0.6 0.4 0.6 China 910.0 91.0 32.7 22.5 35.1 1,118.9 111.9 38.6 28.4 44.0 Hong Kong 19.4 2.2 0.8 0.5 0.9 21.1 2.3 0.8 0.6 0.9 India 221.9 15.5 5.6 3.8 6.0 236.8 16.6 5.7 4.2 6.6 Indonesia 203.9 14.9 5.3 3.7 5.8 241.0 17.6 6.1 4.5 6.9 Japan 484.5 50.9 18.3 12.6 19.6 523.3 54.9 18.9 13.9 21.7 Macao SAR 2.8 0.3 0.1 0.1 0.1 3.7 0.4 0.1 0.1 0.2 Malaysia 33.2 2.4 0.9 0.6 0.9 38.7 2.7 0.9 0.7 1.1 New Zealand 16.3 1.5 0.5 0.4 0.6 18.7 1.8 0.6 0.5 0.7 Philippines 25.9 1.8 0.6 0.4 0.8 29.1 2.0 0.7 0.5 0.8 Singapore 20.1 2.3 0.8 0.6 0.9 23.4 2.7 0.9 0.7 1.1 South Korea 98.4 10.9 3.9 2.7 4.2 108.1 12.0 4.1 3.0 4.8 Taiwan 40.3 4.4 1.6 1.1 1.7 43.8 4.8 1.7 1.2 1.9 Thailand 51.2 3.7 1.3 0.9 1.5 55.6 4.1 1.4 1.0 1.7 Vietnam 22.6 1.7 0.6 0.4 0.7 26.9 2.0 0.7 0.5 0.8 Asia Pacific-Others 33.0 2.2 0.8 0.3 1.1 39.9 2.7 1.0 0.8 0.9 Asia Pacific Total 2,310.0 218.2 78.2 53.7 84.8 2,678.8 253.3 87.4 64.4 99.8 Kazakhstan 22.4 1.8 0.6 0.4 0.8 29.1 2.4 0.8 0.6 1.0 Russia 263.8 20.3 7.3 5.0 7.8 327.1 25.2 8.7 6.4 9.9 Ukraine 21.6 1.7 0.6 0.4 0.7 25.9 2.0 0.7 0.5 0.8 CIS-Others 33.7 2.7 0.9 0.6 1.2 39.9 3.1 0.9 0.8 1.4 CIS Total 341.5 26.5 9.4 6.4 10.5 422.0 32.7 11.1 8.3 13.1

Table 9. 2010-2011 Global Third-Party Logistics Market and Segment Revenues, Cont. 2010 2011

2010 Logistics 2010 3PL 2010 ITM 2010 VAWD 2010 TM 2011 Logistics 2011 3PL 2011 ITM 2011 VAWD 2011 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Austria 36.4 3.7 1.3 0.9 1.5 39.9 4.1 1.4 1.0 1.7 Belgium 42.1 4.4 1.6 1.1 1.7 45.9 4.8 1.7 1.2 1.9 Czech Republic 22.8 2.2 0.8 0.5 0.9 25.1 2.4 0.8 0.6 1.0 Denmark 30.9 3.1 1.1 0.8 1.2 33.0 3.3 1.1 0.8 1.4 Finland 23.1 2.4 0.9 0.6 0.9 25.5 2.6 0.9 0.7 1.0 France 251.6 26.4 8.9 6.5 10.8 271.9 28.5 9.4 7.2 11.7 Germany 301.7 31.7 11.3 7.8 12.4 331.4 34.8 11.8 8.7 14.0 Greece 40.8 3.5 1.3 0.9 1.3 39.2 3.4 1.2 0.9 1.3 Hungary 17.1 1.5 0.5 0.4 0.6 18.4 1.6 0.6 0.4 0.6 Ireland 21.2 2.1 0.8 0.5 0.8 23.1 2.3 0.8 0.6 0.9 Italy 206.6 21.9 7.3 5.4 9.0 221.0 23.4 7.7 5.9 9.6 Netherlands 69.8 10.1 3.4 2.5 4.1 74.6 10.7 3.5 2.7 4.4 Norway 41.1 4.2 1.5 1.0 1.7 47.8 4.8 1.7 1.2 1.9 Poland 56.1 5.2 1.9 1.3 2.0 61.8 5.7 2.0 1.4 2.3 Portugal 28.9 2.7 1.0 0.7 1.0 29.7 2.7 0.9 0.7 1.1 Romania 24.4 2.0 0.7 0.5 0.8 27.0 2.2 0.8 0.6 0.8 Spain 138.8 13.9 4.8 3.4 5.6 144.2 14.4 4.8 3.6 5.9 Sweden 39.6 4.2 1.5 1.0 1.7 45.6 4.8 1.7 1.2 1.9 Switzerland 51.7 5.3 1.9 1.3 2.1 62.0 6.4 2.2 1.6 2.6 United Kingdom 213.1 22.4 7.5 5.5 9.2 228.8 24.0 7.9 6.0 9.9 Europe-Others 69.2 6.0 2.1 1.1 2.8 76.9 6.6 2.2 1.9 2.5 Europe Total 1,727.0 178.9 62.1 43.7 72.1 1,872.8 193.5 65.1 48.9 78.4 Iran 75.1 5.8 2.1 1.4 2.3 92.3 7.1 2.4 1.8 2.8 Israel 26.4 2.5 0.9 0.6 1.0 29.5 2.8 1.0 0.7 1.1 Pakistan 27.6 2.2 0.8 0.5 0.9 33.3 2.6 0.9 0.7 1.0 Saudi Arabia 68.5 6.0 2.2 1.5 2.3 87.3 7.7 2.7 2.0 2.9 Turkey 95.8 8.7 3.1 2.1 3.4 103.2 9.4 3.2 2.4 3.7 United Arab Emirates 28.6 2.8 1.0 0.7 1.1 34.9 3.5 1.2 0.9 1.4 Middle East-Others 85.1 6.8 2.4 1.6 2.8 107.4 8.5 3.0 2.3 3.2 Middle East Total 407.1 34.8 12.5 8.4 13.8 487.9 41.6 14.4 10.8 16.1 Canada 145.2 14.8 5.3 3.7 5.7 161.0 16.4 5.7 4.2 6.4 Mexico 126.1 13.1 4.7 3.2 5.1 140.5 14.6 5.0 3.7 5.8 United States 1,227.1 127.3 45.7 31.4 47.4 1,272.5 135.5 46.1 34.0 52.4 North America-Others 53.2 4.5 1.6 1.0 1.9 58.2 4.7 1.5 1.3 1.9 North America Total 1,551.6 159.7 57.3 39.3 60.1 1,632.2 171.2 58.3 43.2 66.5 Argentina 51.0 4.5 1.6 1.1 1.8 63.3 5.6 1.9 1.4 2.3 Brazil 256.2 23.1 8.3 5.7 8.9 303.2 27.3 9.4 6.9 10.8 Chile 25.1 2.4 0.9 0.6 0.9 29.0 2.7 0.9 0.7 1.1 Colombia 35.9 2.9 1.0 0.7 1.2 41.9 3.4 1.2 0.9 1.3 Peru 18.5 1.6 0.6 0.4 0.6 21.1 1.8 0.6 0.5 0.7 Venezuela 35.0 2.5 0.9 0.6 1.0 39.8 2.8 1.0 0.7 1.1 South America-Others 24.3 1.8 0.7 0.3 0.8 28.5 2.3 0.7 0.7 0.9 South America Total 446.0 38.8 14.0 9.4 15.2 526.8 45.9 15.7 11.8 18.2 Grand Total 7,093.8 680.7 241.7 166.1 266.9 7,961.8 764.5 260.9 194.3 302.6

Table 10. 2012-2013 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2012 2013

2012 Logistics 2012 3PL 2012 ITM 2012 VAWD 2012 TM 2013 Logistics 2013 3PL 2013 ITM 2013 VAWD 2013 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Algeria 34.5 2.6 0.9 0.7 1.0 34.6 2.6 0.8 0.7 1.1 Egypt 41.3 3.4 1.1 0.9 1.4 42.6 3.5 1.1 0.9 1.5 Morocco 14.7 1.2 0.4 0.3 0.5 16.0 1.3 0.4 0.3 0.6 Nigeria 74.2 5.2 1.7 1.3 2.2 82.9 5.8 1.8 1.5 2.5 South Africa 43.2 4.3 1.4 1.1 1.8 40.1 4.0 1.3 1.0 1.7 Sudan 11.0 0.8 0.3 0.2 0.3 11.5 0.8 0.3 0.2 0.3 Africa-Others 143.9 10.3 3.4 2.9 4.0 149.9 11.1 3.4 3.1 4.6 Africa Total 362.8 27.8 9.2 7.4 11.2 377.6 29.1 9.1 7.7 12.3 Australia 134.3 13.7 4.5 3.5 5.6 129.8 13.2 4.2 3.3 5.6 Bangladesh 22.1 1.7 0.6 0.4 0.7 25.2 2.0 0.6 0.5 0.9 China 1,264.1 126.4 41.8 32.1 51.5 1,409.1 140.9 44.9 35.5 59.4 Hong Kong 22.3 2.5 0.8 0.6 1.1 23.4 2.6 0.8 0.7 1.1 India 237.5 16.6 5.5 4.2 6.8 241.2 16.9 5.4 4.3 7.1 Indonesia 248.1 18.1 6.0 4.6 7.4 238.3 17.4 5.5 4.4 7.4 Japan 527.2 55.4 18.3 14.0 22.7 438.2 46.0 14.7 11.6 19.3 Macao SAR 4.3 0.4 0.1 0.1 0.2 5.2 0.5 0.2 0.1 0.2 Malaysia 40.9 2.9 1.0 0.7 1.2 42.0 3.0 1.0 0.8 1.2 New Zealand 19.6 1.9 0.6 0.5 0.8 20.9 2.0 0.6 0.5 0.9 Philippines 32.5 2.3 0.8 0.6 0.9 35.3 2.5 0.8 0.6 1.1 Singapore 24.6 2.9 1.0 0.7 1.2 25.7 3.0 1.0 0.8 1.2 South Korea 110.0 12.2 4.0 3.1 5.0 117.4 13.0 4.1 3.3 5.5 Taiwan 44.8 4.9 1.6 1.2 2.1 46.2 5.0 1.6 1.3 2.1 Thailand 59.6 4.4 1.5 1.1 1.8 63.1 4.6 1.5 1.2 1.9 Vietnam 31.1 2.3 0.8 0.6 0.9 34.1 2.6 0.8 0.7 1.1 Asia Pacific-Others 42.1 3.0 1.1 0.9 1.0 43.4 3.0 1.1 0.9 1.0 Asia Pacific Total 2,865.1 271.6 90.0 68.9 110.9 2,938.5 278.2 88.8 70.5 117.0 Kazakhstan 31.4 2.5 0.8 0.6 1.1 35.7 2.9 0.9 0.7 1.3 Russia 349.4 26.9 8.9 6.8 11.0 359.1 27.7 8.8 7.0 11.7 Ukraine 27.9 2.2 0.7 0.6 0.9 28.6 2.2 0.7 0.6 0.9 CIS-Others 43.7 3.3 1.0 0.8 1.5 48.0 3.6 1.1 0.8 1.7 CIS Total 452.4 34.9 11.4 8.8 14.5 471.4 36.4 11.5 9.1 15.6

Table 10. 2012-2013 Global Third-Party Logistics Market and Segment Revenues, Cont.

2012 2013

2012 Logistics 2012 3PL 2012 ITM 2012 VAWD 2012 TM 2013 Logistics 2013 3PL 2013 ITM 2013 VAWD 2013 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Austria 37.9 3.9 1.3 1.0 1.6 39.8 4.1 1.3 1.0 1.8 Belgium 43.3 4.5 1.5 1.1 1.9 45.3 4.7 1.5 1.2 2.0 Czech Republic 22.8 2.2 0.7 0.6 0.9 23.0 2.2 0.7 0.6 0.9 Denmark 31.4 3.2 1.1 0.8 1.3 33.0 3.3 1.1 0.8 1.4 Finland 23.9 2.4 0.8 0.6 1.0 25.1 2.6 0.8 0.7 1.1 France 254.6 26.7 8.4 6.8 11.3 266.6 28.0 8.5 7.0 12.3 Germany 312.5 32.8 10.7 8.3 13.5 330.8 34.7 10.9 8.6 14.9 Greece 33.4 2.9 1.0 0.7 1.2 32.6 2.8 0.9 0.7 1.2 Hungary 16.7 1.5 0.5 0.4 0.6 17.6 1.5 0.5 0.4 0.6 Ireland 21.7 2.2 0.7 0.6 0.9 22.9 2.3 0.7 0.6 1.0 Italy 201.2 21.3 6.7 5.4 9.0 206.8 21.9 6.7 5.4 9.6 Netherlands 69.1 10.0 3.2 2.5 4.2 72.3 10.4 3.2 2.6 4.5 Norway 48.9 4.9 1.6 1.2 2.1 50.2 5.1 1.6 1.3 2.2 Poland 58.6 5.4 1.8 1.4 2.2 61.4 5.7 1.8 1.4 2.5 Portugal 26.2 2.4 0.8 0.6 1.0 27.4 2.5 0.8 0.6 1.1 Romania 24.9 2.1 0.7 0.5 0.9 27.8 2.3 0.7 0.6 1.0 Spain 129.4 12.9 4.1 3.3 5.4 131.9 13.2 4.0 3.3 5.8 Sweden 44.1 4.7 1.6 1.2 1.9 46.9 5.0 1.6 1.3 2.1 Switzerland 59.2 6.1 2.0 1.5 2.6 61.0 6.3 2.0 1.6 2.6 United Kingdom 232.7 24.4 7.7 6.2 10.3 238.5 25.0 7.6 6.2 11.0 Europe-Others 71.6 6.5 2.2 1.8 2.5 76.3 6.6 2.2 1.9 2.5 Europe Total 1,764.1 183.0 59.1 46.5 76.3 1,837.2 190.2 59.1 47.8 82.1 Iran 61.9 4.8 1.6 1.2 2.0 61.5 4.7 1.5 1.2 2.0 Israel 29.1 2.8 0.9 0.7 1.2 33.1 3.1 1.0 0.8 1.3 Pakistan 35.0 2.8 0.9 0.7 1.2 36.1 2.9 0.9 0.7 1.3 Saudi Arabia 95.7 8.4 2.8 2.1 3.4 97.1 8.5 2.7 2.1 3.6 Turkey 108.3 9.9 3.3 2.5 4.0 117.8 10.7 3.4 2.7 4.5 United Arab Emirates 37.3 3.7 1.2 0.9 1.6 38.9 3.9 1.2 1.0 1.7 Middle East-Others 121.8 9.7 3.2 2.4 4.1 128.6 10.4 3.3 2.7 4.4 Middle East Total 489.1 42.1 13.9 10.5 17.5 513.1 44.2 14.0 11.2 18.8 Canada 164.2 16.7 5.5 4.2 6.9 165.8 16.9 5.3 4.3 7.2 Mexico 142.4 14.8 4.8 3.7 6.2 151.4 15.7 4.9 4.0 6.7 United States 1,324.7 142.0 46.3 36.0 56.7 1,368.7 147.0 46.2 36.5 61.2 North America-Others 61.1 4.8 1.6 1.4 1.8 63.6 5.1 1.7 1.4 2.0 North America Total 1,692.4 178.3 58.2 45.3 71.6 1,749.5 184.7 58.1 46.2 77.1 Argentina 69.6 6.2 2.0 1.6 2.6 73.4 6.5 2.1 1.6 2.7 Brazil 285.8 25.7 8.5 6.5 10.5 286.7 25.8 8.2 6.5 10.9 Chile 30.7 2.9 1.0 0.7 1.2 32.0 3.0 1.0 0.8 1.2 Colombia 46.2 3.8 1.3 1.0 1.5 47.5 3.9 1.2 1.0 1.7 Peru 23.6 2.0 0.7 0.5 0.8 24.7 2.1 0.7 0.5 0.9 Venezuela 39.4 2.8 0.9 0.7 1.2 27.1 1.9 0.6 0.5 0.8 South America-Others 31.0 2.4 0.8 0.7 0.9 34.2 2.8 0.8 0.7 1.3 South America Total 526.3 45.8 15.2 11.7 18.7 525.6 46.0 14.6 11.6 19.5 Grand Total 8,152.2 783.5 257.0 199.1 320.7 8,412.9 808.8 255.2 204.1 342.4

Table 11. 2014-2015 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2014 2015

2014 Logistics 2014 3PL 2014 ITM 2014 VAWD 2014 TM 2015 Logistics 2015 3PL 2015 ITM 2015 VAWD 2015 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Algeria 35.2 2.6 0.8 0.7 1.1 27.2 2.0 0.6 0.5 0.9 Egypt 45.2 3.7 1.1 0.9 1.7 49.1 4.0 1.2 1.0 1.8 Morocco 16.5 1.3 0.4 0.3 0.6 15.1 1.2 0.4 0.3 0.5 Nigeria 91.5 6.4 1.9 1.6 2.8 79.5 5.6 1.7 1.4 2.5 South Africa 38.3 3.8 1.2 1.0 1.6 34.3 3.4 1.0 0.9 1.5 Sudan 12.4 0.9 0.3 0.2 0.4 14.3 1.0 0.3 0.3 0.4 Africa-Others 150.3 11.1 3.5 3.3 4.3 137.2 10.2 2.6 2.5 5.1 Africa Total 389.4 29.8 9.2 8.0 12.5 356.7 27.4 7.8 6.9 12.7 Australia 124.6 12.7 3.9 3.2 5.5 105.8 10.8 3.2 2.7 4.8 Bangladesh 28.7 2.3 0.7 0.6 1.0 32.2 2.5 0.7 0.6 1.2 China 1,527.5 152.8 46.4 38.7 66.4 1,627.8 162.8 48.4 41.2 71.8 Hong Kong 24.7 2.7 0.8 0.7 1.2 26.3 2.9 0.9 0.7 1.3 India 264.2 18.5 5.6 4.7 8.0 271.2 19.0 5.7 4.8 8.3 Indonesia 213.9 15.6 4.7 3.9 6.9 206.7 15.1 4.5 3.8 6.7 Japan 412.1 43.3 13.2 11.0 18.7 372.5 39.1 11.6 9.9 17.3 Macao SAR 5.5 0.5 0.2 0.1 0.2 4.5 0.4 0.1 0.1 0.2 Malaysia 43.9 3.1 0.9 0.8 1.4 38.5 2.7 0.8 0.7 1.2 New Zealand 22.3 2.1 0.6 0.5 1.0 19.4 1.8 0.5 0.5 0.8 Philippines 37.0 2.6 0.8 0.7 1.1 38.0 2.7 0.8 0.7 1.2 Singapore 26.2 3.0 0.9 0.8 1.3 25.2 2.9 0.9 0.7 1.3 South Korea 126.9 14.1 4.3 3.6 6.1 124.3 13.8 4.1 3.5 6.1 Taiwan 47.9 5.2 1.6 1.3 2.3 47.4 5.2 1.5 1.3 2.4 Thailand 61.0 4.5 1.4 1.1 2.0 59.9 4.4 1.3 1.1 2.0 Vietnam 37.2 2.8 0.9 0.7 1.2 38.3 2.9 0.9 0.7 1.3 Asia Pacific-Others 46.0 3.2 1.0 1.0 1.2 44.5 3.1 1.0 1.0 1.1 Asia Pacific Total 3,049.6 289.0 87.9 73.4 125.5 3,082.5 292.1 86.9 74.0 129.0 Kazakhstan 33.4 2.7 0.8 0.7 1.2 27.8 2.3 0.7 0.6 1.0 Russia 332.2 25.6 7.8 6.5 11.1 219.9 16.9 5.0 4.3 7.5 Ukraine 21.0 1.6 0.5 0.4 0.7 14.5 1.1 0.3 0.3 0.5 CIS-Others 50.9 3.8 1.1 0.9 1.8 41.2 3.1 0.8 0.8 1.5 CIS Total 437.5 33.7 10.2 8.5 14.8 303.4 23.4 6.8 6.0 10.5

Table 11. 2014-2015 Global Third-Party Logistics Market and Segment Revenues, Cont.

2014 2015

2014 Logistics 2014 3PL 2014 ITM 2014 VAWD 2014 TM 2015 Logistics 2015 3PL 2015 ITM 2015 VAWD 2015 TM Country/Region Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Austria 40.8 4.2 1.3 1.1 1.8 35.1 3.6 1.1 0.9 1.6 Belgium 46.3 4.8 1.5 1.2 2.1 39.6 4.1 1.2 1.0 1.9 Czech Republic 22.9 2.2 0.7 0.6 0.9 20.4 2.0 0.6 0.5 0.9 Denmark 33.8 3.4 1.0 0.9 1.5 28.9 2.9 0.9 0.7 1.3 Finland 25.4 2.6 0.8 0.7 1.1 21.6 2.2 0.7 0.6 0.9 France 269.8 28.3 8.2 6.7 13.1 229.6 24.1 6.9 5.7 11.3 Germany 342.4 36.0 10.8 8.5 16.4 296.5 31.1 9.1 7.4 14.3 Greece 32.2 2.8 0.9 0.7 1.2 26.5 2.3 0.7 0.6 1.0 Hungary 18.2 1.6 0.5 0.4 0.7 15.9 1.4 0.4 0.4 0.6 Ireland 24.6 2.5 0.8 0.6 1.1 27.2 2.7 0.8 0.7 1.2 Italy 209.1 22.2 6.5 5.3 10.2 177.1 18.8 5.4 4.5 8.7 Netherlands 73.4 10.6 3.1 2.5 4.9 62.6 9.0 2.6 2.1 4.2 Norway 47.8 4.8 1.5 1.2 2.1 37.1 3.7 1.1 0.9 1.7 Poland 63.8 5.9 1.8 1.5 2.6 55.8 5.2 1.5 1.3 2.4 Portugal 27.8 2.6 0.8 0.7 1.1 24.1 2.2 0.7 0.6 0.9 Romania 28.9 2.4 0.7 0.6 1.1 25.7 2.1 0.6 0.5 1.0 Spain 133.4 13.3 3.9 3.2 6.1 115.5 11.6 3.3 2.8 5.4 Sweden 46.5 4.9 1.5 1.2 2.2 40.2 4.3 1.3 1.1 1.9 Switzerland 62.5 6.4 1.9 1.6 2.8 59.7 6.1 1.8 1.5 2.7 United Kingdom 263.1 27.6 8.0 6.5 12.9 250.9 26.3 7.5 6.3 12.3 Europe-Others 77.8 6.7 2.1 1.9 2.7 67.5 5.9 1.6 1.6 2.7 Europe Total 1,890.5 195.8 58.3 47.6 88.6 1,657.5 171.6 49.8 41.7 78.9 Iran 67.2 5.2 1.6 1.3 2.3 60.6 4.7 1.4 1.2 2.1 Israel 34.9 3.3 1.0 0.8 1.5 33.8 3.2 1.0 0.8 1.4 Pakistan 38.1 3.0 0.9 0.8 1.3 42.3 3.3 1.0 0.8 1.5 Saudi Arabia 98.3 8.7 2.6 2.2 3.8 84.7 7.5 2.2 1.9 3.3 Turkey 115.8 10.5 3.2 2.7 4.5 106.5 9.7 2.9 2.5 4.2 United Arab Emirates 40.2 4.0 1.2 1.0 1.8 37.0 3.7 1.1 0.9 1.7 Middle East-Others 129.5 10.5 3.2 2.8 4.5 105.3 8.4 2.5 2.2 3.7 Middle East Total 524.0 45.2 13.7 11.6 19.7 470.2 40.5 12.1 10.3 17.9 Canada 161.4 16.5 5.0 4.2 7.2 139.8 14.3 4.2 3.6 6.4 Mexico 155.8 16.2 4.9 4.1 7.1 138.1 14.4 4.2 3.6 6.5 United States 1,426.2 157.8 47.3 37.4 70.0 1,479.0 161.2 47.3 38.4 72.4 North America-Others 66.0 5.2 1.5 1.5 2.2 68.7 5.6 1.6 1.6 2.4 North America Total 1,809.4 195.7 58.7 47.2 86.5 1,825.6 195.5 57.3 47.2 87.7 Argentina 67.6 6.0 1.8 1.5 2.6 75.8 6.7 2.0 1.7 2.9 Brazil 284.9 25.6 7.8 6.5 11.1 209.0 18.8 5.6 4.8 8.2 Chile 30.0 2.8 0.9 0.7 1.2 27.9 2.6 0.8 0.7 1.1 Colombia 47.3 3.9 1.2 1.0 1.7 36.4 3.0 0.9 0.8 1.3 Peru 25.4 2.1 0.6 0.5 1.0 24.0 2.0 0.6 0.5 0.9 Venezuela 25.6 1.8 0.5 0.5 0.8 31.0 2.2 0.7 0.6 0.9 South America-Others 35.9 2.8 0.8 0.7 1.3 34.5 2.6 0.8 0.7 1.1 South America Total 516.7 45.0 13.6 11.4 19.7 438.6 37.9 11.4 9.8 16.4 Grand Total 8,617.1 834.2 251.6 207.7 367.3 8,134.5 788.4 232.1 195.9 353.1

Table 12. 2016-2017 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2016 2017

2017E 2016 Logistics 2016 3PL 2016 ITM 2016 VAWD 2016 TM 2017E Logistics 2017E 3PL 2017E ITM 2017E TM Country/Region VAWD Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Algeria 26.5 2.0 0.6 0.5 0.9 28.7 2.2 0.6 0.6 1.0 Egypt 49.2 4.0 1.2 1.0 1.8 30.0 2.5 0.7 0.6 1.2 Morocco 15.5 1.3 0.4 0.3 0.6 15.8 1.3 0.4 0.3 0.6 Nigeria 65.4 4.6 1.4 1.2 2.0 64.5 4.6 1.3 1.2 2.1 South Africa 32.1 3.2 0.9 0.8 1.5 34.6 3.5 1.0 0.9 1.6 Sudan 16.5 1.2 0.4 0.3 0.5 20.3 1.5 0.4 0.4 0.7 Africa-Others 137.9 9.9 2.5 2.3 5.1 151.8 11.3 3.1 2.9 5.3 Africa Total 343.1 26.2 7.4 6.4 12.4 345.7 26.9 7.5 6.9 12.5 Australia 108.3 11.0 3.2 2.8 4.9 116.9 12.0 3.4 3.0 5.5 Bangladesh 35.6 2.8 0.8 0.7 1.3 38.8 3.1 0.9 0.8 1.4 China 1,626.7 166.7 49.2 42.2 73.9 1,710.3 177.0 50.4 44.8 80.2 Hong Kong 27.2 3.0 0.9 0.8 1.3 28.2 3.2 0.9 0.8 1.5 India 293.1 20.5 6.0 5.2 9.1 318.8 22.6 6.4 5.7 10.3 Indonesia 223.8 16.3 4.8 4.1 7.3 234.7 17.4 5.0 4.4 7.8 Japan 419.8 44.1 13.0 11.2 19.5 411.5 43.6 12.4 11.0 19.8 Macao SAR 4.4 0.4 0.1 0.1 0.2 4.6 0.5 0.1 0.1 0.3 Malaysia 38.5 2.7 0.8 0.7 1.2 40.3 2.9 0.8 0.7 1.4 New Zealand 20.4 1.9 0.6 0.5 0.8 22.2 2.1 0.6 0.5 1.0 Philippines 39.6 2.8 0.8 0.7 1.3 42.9 3.0 0.9 0.8 1.3 Singapore 25.2 2.9 0.9 0.7 1.3 24.8 2.9 0.8 0.7 1.4 South Korea 126.9 14.1 4.2 3.6 6.2 134.7 15.1 4.3 3.8 6.9 Taiwan 47.7 5.2 1.5 1.3 2.4 51.2 5.6 1.6 1.4 2.6 Thailand 61.0 4.5 1.3 1.1 2.1 64.9 4.8 1.4 1.2 2.2 Vietnam 40.3 3.0 0.9 0.8 1.3 43.2 3.3 0.9 0.8 1.6 Asia Pacific-Others 46.0 3.1 0.9 0.9 1.3 48.4 3.4 1.0 0.9 1.5 Asia Pacific Total 3,184.5 305.0 89.9 77.4 135.4 3,336.4 322.5 91.8 81.4 146.7 Kazakhstan 20.2 1.6 0.5 0.4 0.7 23.8 2.0 0.6 0.5 0.9 Russia 206.2 15.9 4.7 4.0 7.1 251.3 19.6 5.6 5.0 8.8 Ukraine 14.8 1.2 0.4 0.3 0.5 15.3 1.2 0.3 0.3 0.6 CIS-Others 38.1 3.0 0.7 0.7 1.6 40.6 3.2 0.8 0.7 1.7 CIS Total 279.3 21.7 6.3 5.4 9.9 331.0 26.0 7.3 6.5 12.0

Table 12. 2016-2017 Global Third-Party Logistics Market and Segment Revenues, Cont. 2016 2017

2017E 2016 Logistics 2016 3PL 2016 ITM 2016 VAWD 2016 TM 2017E Logistics 2017E 3PL 2017E ITM 2017E TM Country/Region VAWD Cost Revenue Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue

Austria 36.0 3.7 1.1 0.9 1.7 36.5 3.8 1.1 1.0 1.7 Belgium 40.6 4.2 1.2 1.1 1.9 41.2 4.3 1.2 1.1 2.0 Czech Republic 21.2 2.0 0.6 0.5 0.9 21.6 2.1 0.6 0.5 1.0 Denmark 29.4 3.0 0.9 0.8 1.3 29.9 3.0 0.9 0.8 1.3 Finland 22.0 2.2 0.6 0.6 1.0 22.4 2.3 0.7 0.6 1.0 France 233.7 24.5 6.9 5.7 11.7 237.2 25.1 6.8 5.8 12.3 Germany 305.5 32.1 9.3 7.5 15.0 311.6 33.0 9.3 7.6 15.8 Greece 26.4 2.3 0.7 0.6 1.0 26.3 2.3 0.7 0.6 1.0 Hungary 16.5 1.5 0.4 0.4 0.7 16.4 1.5 0.4 0.4 0.7 Ireland 28.2 2.8 0.8 0.7 1.3 28.2 2.9 0.8 0.7 1.4 Italy 179.6 19.0 5.4 4.5 8.9 179.7 19.2 5.2 4.4 9.4 Netherlands 64.3 9.3 2.6 2.2 4.4 65.2 9.4 2.6 2.2 4.5 Norway 35.6 3.6 1.1 0.9 1.6 37.6 3.8 1.1 1.0 1.7 Poland 54.7 5.1 1.5 1.3 2.3 56.5 5.3 1.5 1.3 2.5 Portugal 24.8 2.3 0.7 0.6 1.0 24.8 2.3 0.7 0.6 1.0 Romania 27.1 2.2 0.6 0.6 1.0 27.5 2.3 0.7 0.6 1.0 Spain 119.3 11.9 3.4 2.8 5.6 119.9 12.1 3.3 2.8 5.9 Sweden 41.4 4.4 1.3 1.1 2.0 42.0 4.5 1.3 1.1 2.1 Switzerland 58.7 6.0 1.8 1.5 2.6 58.7 6.1 1.7 1.5 2.8 United Kingdom 230.4 24.2 6.8 5.7 11.5 218.8 23.2 6.3 5.4 11.3 Europe-Others 70.1 6.0 1.7 1.7 2.6 70.2 6.1 1.7 1.7 2.7 Europe Total 1,665.5 172.3 49.4 41.7 80.0 1,672.2 174.6 48.6 41.7 83.1 Iran 61.0 4.7 1.4 1.2 2.1 59.7 4.7 1.3 1.2 2.2 Israel 36.0 3.4 1.0 0.9 1.5 38.4 3.7 1.1 0.9 1.7 Pakistan 44.3 3.5 1.0 0.9 1.6 35.0 2.8 0.8 0.7 1.3 Saudi Arabia 83.2 7.3 2.2 1.8 3.2 92.0 8.2 2.3 2.1 3.7 Turkey 106.3 9.7 2.9 2.5 4.2 106.3 9.8 2.8 2.5 4.4 United Arab Emirates 37.1 3.7 1.1 0.9 1.7 40.7 4.1 1.2 1.0 1.9 Middle East-Others 99.0 7.9 2.3 2.1 3.5 109.7 8.9 2.6 2.3 4.0 Middle East Total 466.9 40.2 11.9 10.3 17.8 481.8 42.2 12.1 10.7 19.2 Canada 137.6 14.0 4.1 3.5 6.3 144.0 14.8 4.2 3.7 6.8 Mexico 125.5 13.1 3.8 3.3 5.9 118.5 12.4 3.5 3.1 5.7 United States 1,522.7 166.8 48.5 39.1 76.0 1,592.2 175.3 49.2 40.5 82.3 North America-Others 70.4 5.7 1.7 1.6 2.4 72.8 5.9 1.8 1.6 2.5 North America Total 1,856.2 199.6 58.1 47.5 90.6 1,927.5 208.4 58.7 48.9 97.3 Argentina 65.4 5.8 1.7 1.5 2.6 75.5 6.8 1.9 1.7 3.1 Brazil 208.6 18.8 5.5 4.8 8.3 248.3 22.6 6.4 5.7 10.3 Chile 28.4 2.7 0.8 0.7 1.2 28.9 2.7 0.8 0.7 1.2 Colombia 35.3 2.9 0.9 0.7 1.3 38.3 3.2 0.9 0.8 1.5 Peru 24.4 2.0 0.6 0.5 0.9 25.9 2.2 0.6 0.6 1.0 Venezuela 34.2 2.4 0.7 0.6 1.1 29.9 2.1 0.6 0.5 1.0 South America-Others 34.5 2.6 0.8 0.7 1.1 36.0 2.8 0.7 0.7 1.4 South America Total 430.8 37.2 11.0 9.5 16.5 482.8 42.4 11.9 10.7 19.5 Grand Total 8,226.3 802.2 234.0 198.2 362.6 8,577.4 843.0 237.9 206.8 390.3

Table 13. 2018-2019 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2018 2019

2018E 2019E 2018E Logistics 2018E 3PL 2018E ITM 2018E TM 2019E Logistics 2019E 3PL 2019E ITM 2019E TM Country/Region VAWD VAWD Cost Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue Revenue

Algeria 29.3 2.3 0.6 0.6 1.1 30.0 2.3 0.6 0.6 1.1 Egypt 30.0 2.5 0.7 0.6 1.2 30.0 2.6 0.7 0.7 1.2 Morocco 16.6 1.4 0.4 0.4 0.6 17.6 1.5 0.4 0.4 0.7 Nigeria 76.0 5.5 1.5 1.4 2.6 89.7 6.5 1.7 1.6 3.1 South Africa 35.6 3.6 1.0 0.9 1.7 37.0 3.8 1.0 1.0 1.8 Sudan 24.2 1.8 0.5 0.5 0.8 28.5 2.1 0.6 0.5 1.0 Africa-Others 164.5 12.3 3.3 3.2 5.8 176.6 13.4 3.7 3.7 6.0 Africa Total 376.2 29.4 8.0 7.6 13.8 409.4 32.2 8.7 8.5 14.9 Australia 122.8 12.8 3.5 3.2 6.0 128.8 13.5 3.5 3.4 6.5 Bangladesh 42.5 3.4 0.9 0.9 1.6 46.4 3.8 1.0 1.0 1.8 China 1,855.5 193.9 53.1 49.1 90.0 2,010.1 212.1 55.7 53.7 100.7 Hong Kong 29.0 3.3 0.9 0.8 1.6 30.2 3.4 0.9 0.9 1.6 India 348.9 25.1 6.9 6.4 11.6 384.4 28.1 7.4 7.1 13.3 Indonesia 244.9 18.4 5.0 4.7 8.5 265.4 20.2 5.3 5.1 9.6 Japan 420.9 45.0 12.3 11.4 20.9 432.3 46.7 12.3 11.8 22.2 Macao SAR 4.7 0.5 0.1 0.1 0.3 4.9 0.5 0.1 0.1 0.3 Malaysia 44.0 3.2 0.9 0.8 1.5 48.8 3.6 0.9 0.9 1.8 New Zealand 23.2 2.3 0.6 0.6 1.1 24.3 2.4 0.6 0.6 1.2 Philippines 48.3 3.5 1.0 0.9 1.6 54.4 4.0 1.1 1.0 1.9 Singapore 25.6 3.0 0.8 0.8 1.4 26.4 3.1 0.8 0.8 1.5 South Korea 139.6 15.8 4.3 4.0 7.4 145.4 16.6 4.4 4.2 7.8 Taiwan 52.4 5.8 1.6 1.5 2.6 53.7 6.0 1.6 1.5 2.8 Thailand 68.8 5.2 1.4 1.3 2.5 73.0 5.5 1.4 1.4 2.6 Vietnam 46.5 3.6 1.0 0.9 1.7 50.1 3.9 1.0 1.0 1.9 Asia Pacific-Others 51.7 3.6 1.1 1.1 1.4 56.3 4.2 1.2 1.2 1.8 Asia Pacific Total 3,569.3 348.4 95.4 88.5 161.7 3,834.9 377.6 99.2 95.7 179.3 Kazakhstan 26.3 2.2 0.6 0.6 1.0 28.5 2.4 0.6 0.6 1.2 Russia 259.4 20.5 5.6 5.2 9.5 266.3 21.3 5.6 5.4 10.1 Ukraine 16.3 1.3 0.4 0.3 0.6 17.8 1.4 0.4 0.4 0.6 CIS-Others 43.4 3.3 0.8 0.8 1.7 46.2 3.7 1.1 1.1 1.5 CIS Total 345.4 27.3 7.4 6.9 12.8 358.8 28.8 7.7 7.5 13.4

Table 13. 2018-2019 Global Third-Party Logistics Market and Segment Revenues, Cont. 2018 2019

Austria 37.1 3.9 1.1 1.0 1.8 38.1 4.0 1.1 1.0 1.9 Belgium 41.9 4.4 1.2 1.1 2.1 42.8 4.6 1.2 1.2 2.2 Czech Republic 22.9 2.2 0.6 0.6 1.0 24.2 2.4 0.6 0.6 1.2 Denmark 30.3 3.1 0.8 0.8 1.5 31.2 3.2 0.8 0.8 1.6 Finland 22.7 2.4 0.7 0.6 1.1 23.2 2.4 0.6 0.6 1.2 France 240.8 25.8 6.8 5.8 12.9 243.1 26.3 6.6 5.8 13.6 Germany 317.8 34.0 9.2 7.7 16.8 324.2 35.0 9.1 7.8 17.8 Greece 27.3 2.4 0.7 0.6 1.1 28.3 2.5 0.7 0.6 1.2 Hungary 17.1 1.5 0.4 0.4 0.7 17.8 1.6 0.4 0.4 0.8 Ireland 29.4 3.0 0.8 0.8 1.4 30.8 3.2 0.8 0.8 1.6 Italy 179.9 19.4 5.1 4.4 9.7 182.3 19.9 5.0 4.4 10.3 Netherlands 66.2 9.5 2.5 2.2 4.7 67.3 9.7 2.4 2.2 5.0 Norway 38.9 4.0 1.1 1.0 1.9 40.2 4.2 1.1 1.1 2.0 Poland 59.7 5.7 1.6 1.4 2.6 63.1 6.1 1.6 1.5 2.9 Portugal 25.2 2.4 0.7 0.6 1.1 25.8 2.5 0.7 0.6 1.2 Romania 29.4 2.5 0.7 0.6 1.2 31.4 2.7 0.7 0.7 1.3 Spain 120.5 12.3 3.2 2.8 6.2 127.8 13.2 3.3 2.9 6.9 Sweden 43.0 4.6 1.3 1.2 2.1 45.0 4.9 1.3 1.2 2.4 Switzerland 59.9 6.3 1.7 1.6 2.9 61.3 6.5 1.7 1.6 3.1 United Kingdom 222.9 23.9 6.3 5.4 12.0 228.5 24.7 6.2 5.5 12.8 Europe-Others 73.8 6.4 1.8 1.8 2.8 77.8 7.1 2.1 2.1 2.9 Europe Total 1,706.7 179.7 48.3 42.4 87.6 1,754.2 186.7 48.0 43.4 93.9 Iran 62.4 4.9 1.3 1.2 2.4 66.5 5.3 1.4 1.3 2.6 Israel 39.9 3.9 1.1 1.0 1.8 41.6 4.1 1.1 1.0 2.0 Pakistan 35.0 2.8 0.8 0.7 1.3 35.0 2.9 0.8 0.7 1.4 Saudi Arabia 96.2 8.7 2.4 2.2 4.0 99.2 9.0 2.4 2.3 4.2 Turkey 106.3 9.9 2.7 2.5 4.6 108.7 10.2 2.7 2.6 4.8 United Arab Emirates 43.6 4.4 1.2 1.1 2.1 45.9 4.7 1.2 1.2 2.3 Middle East-Others 117.7 9.7 2.5 2.5 4.7 123.7 10.3 2.7 2.7 4.9 Middle East Total 501.1 44.3 12.0 11.2 20.9 520.6 46.5 12.3 11.8 22.2 Canada 149.1 15.5 4.2 3.9 7.3 154.8 16.3 4.2 4.1 7.8 Mexico 123.9 13.1 3.5 3.3 6.2 131.4 14.1 3.7 3.6 6.7 United States 1,668.8 184.9 49.9 41.9 89.7 1,741.6 195.4 50.6 43.4 97.9 North America-Others 75.9 6.4 1.8 1.8 2.8 79.7 6.6 1.8 1.8 3.0 North America Total 2,017.7 219.9 59.4 50.9 106.0 2,107.5 232.4 60.3 52.9 115.4 Argentina 79.0 7.2 2.0 1.8 3.3 85.4 7.9 2.1 2.0 3.7 Brazil 259.7 23.9 6.5 6.0 11.2 271.5 25.2 6.6 6.4 12.0 Chile 30.1 2.9 0.8 0.7 1.4 31.5 3.1 0.8 0.8 1.5 Colombia 40.3 3.4 0.9 0.9 1.6 42.6 3.6 0.9 0.9 1.8 Peru 27.4 2.4 0.7 0.6 1.1 29.0 2.5 0.7 0.6 1.2 Venezuela 32.5 2.3 0.6 0.6 1.1 21.9 1.6 0.4 0.4 0.8 South America-Others 37.1 3.0 0.7 0.7 1.6 38.8 3.2 0.8 0.8 1.6 South America Total 506.1 45.1 12.2 11.3 21.3 520.7 47.1 12.3 11.9 22.6 Grand Total 9,022.5 894.1 242.7 218.8 424.1 9,506.1 951.3 248.5 231.7 461.7

Table 14. 2020-2021 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2020 2021

2020E 2021E 2020E Logistics 2020E 3PL 2020E ITM 2020E TM 2021E Logistics 2021E 3PL 2021E ITM 2021E TM Country/Region VAWD VAWD Cost Revenue Revenue Revenue Cost Revenue Revenue Revenue Revenue Revenue

Algeria 30.9 2.4 0.6 0.6 1.2 32.2 2.6 0.7 0.7 1.2 Egypt 30.0 2.6 0.7 0.7 1.2 30.0 2.6 0.7 0.7 1.2 Morocco 18.6 1.6 0.4 0.4 0.8 19.7 1.7 0.4 0.4 0.9 Nigeria 98.7 7.3 1.8 1.8 3.6 102.1 7.7 1.9 1.9 3.8 South Africa 38.5 4.0 1.0 1.0 2.0 40.0 4.2 1.1 1.1 2.0 Sudan 33.3 2.5 0.6 0.6 1.3 38.7 3.0 0.8 0.8 1.4 Africa-Others 191.4 14.6 4.0 4.0 6.6 208.3 16.4 4.6 4.6 7.2 Africa Total 441.4 35.0 9.1 9.1 16.7 471.0 38.2 10.2 10.2 17.7 Australia 134.9 14.3 3.6 3.6 7.0 140.7 15.1 3.8 3.8 7.4 Bangladesh 50.7 4.2 1.1 1.1 2.0 55.3 4.6 1.2 1.2 2.2 China 2,184.7 232.7 58.6 58.9 113.0 2,369.4 254.7 64.2 64.4 123.7 Hong Kong 31.3 3.6 0.9 0.9 1.8 32.6 3.8 1.0 1.0 1.8 India 422.5 31.3 7.9 7.9 15.2 464.6 34.8 8.8 8.8 16.9 Indonesia 290.4 22.4 5.6 5.7 10.9 322.5 25.2 6.4 6.4 12.2 Japan 438.9 47.8 12.0 12.1 23.2 447.2 49.2 12.4 12.4 23.9 Macao SAR 5.1 0.5 0.1 0.1 0.3 5.3 0.6 0.2 0.2 0.2 Malaysia 53.4 4.0 1.0 1.0 2.0 58.3 4.4 1.1 1.1 2.2 New Zealand 25.4 2.5 0.6 0.6 1.3 26.6 2.7 0.7 0.7 1.3 Philippines 61.3 4.5 1.1 1.1 2.3 68.3 5.1 1.3 1.3 2.5 Singapore 27.2 3.3 0.8 0.8 1.7 28.1 3.4 0.9 0.9 1.6 South Korea 151.5 17.4 4.4 4.4 8.4 157.9 18.3 4.6 4.6 8.9 Taiwan 55.5 6.3 1.6 1.6 3.0 57.4 6.5 1.6 1.6 3.2 Thailand 76.9 5.9 1.5 1.5 2.8 80.9 6.3 1.6 1.6 3.0 Vietnam 54.0 4.3 1.1 1.1 2.1 58.3 4.7 1.2 1.2 2.3 Asia Pacific-Others 61.1 4.6 1.2 1.2 2.2 66.6 5.1 1.4 1.4 2.3 Asia Pacific Total 4,124.8 409.6 103.1 103.6 199.2 4,440.0 444.5 112.4 112.6 215.6 Kazakhstan 30.9 2.6 0.7 0.7 1.2 32.8 2.8 0.7 0.7 1.4 Russia 275.6 22.3 5.6 5.6 10.9 286.9 23.5 5.9 5.9 11.5 Ukraine 19.5 1.6 0.4 0.4 0.8 21.4 1.8 0.5 0.5 0.8 CIS-Others 49.4 3.9 1.1 1.1 1.7 52.7 4.2 1.1 1.1 2.0 CIS Total 375.4 30.4 7.8 7.8 14.6 393.8 32.3 8.2 8.2 15.7

Table 14. 2020-2021 Global Third-Party Logistics Market and Segment Revenues, Cont. 2020 2021

Austria 39.3 4.2 1.1 1.1 2.0 40.4 4.3 1.1 1.1 2.1 Belgium 44.2 4.8 1.2 1.2 2.4 45.7 5.0 1.3 1.3 2.4 Czech Republic 25.6 2.6 0.7 0.7 1.2 26.9 2.7 0.7 0.7 1.3 Denmark 32.4 3.4 0.9 0.9 1.6 33.6 3.6 0.9 0.9 1.8 Finland 24.0 2.5 0.6 0.6 1.3 24.8 2.7 0.7 0.7 1.3 France 251.5 27.4 6.6 5.9 14.6 259.4 28.5 6.9 6.2 15.1 Germany 328.5 35.8 8.9 7.8 18.7 337.3 37.1 9.2 8.1 19.4 Greece 29.4 2.6 0.7 0.7 1.2 30.3 2.8 0.7 0.7 1.4 Hungary 18.4 1.7 0.4 0.4 0.9 19.0 1.8 0.5 0.5 0.8 Ireland 32.2 3.4 0.9 0.9 1.6 33.6 3.6 0.9 0.9 1.8 Italy 186.5 20.5 4.9 4.5 10.9 190.2 21.1 5.1 4.6 11.2 Netherlands 69.4 10.0 2.4 2.2 5.3 71.3 10.3 2.5 2.2 5.5 Norway 41.1 4.3 1.1 1.1 2.1 42.0 4.5 1.1 1.1 2.3 Poland 66.5 6.5 1.6 1.6 3.2 70.2 6.9 1.7 1.7 3.4 Portugal 26.6 2.6 0.7 0.7 1.2 27.2 2.6 0.7 0.7 1.2 Romania 33.5 2.9 0.7 0.7 1.5 35.4 3.1 0.8 0.8 1.5 Spain 132.4 13.8 3.3 3.0 7.4 136.7 14.4 3.5 3.1 7.7 Sweden 46.9 5.2 1.3 1.3 2.6 48.9 5.4 1.4 1.4 2.6 Switzerland 62.8 6.7 1.7 1.7 3.2 64.2 6.9 1.7 1.7 3.4 United Kingdom 235.7 25.7 6.2 5.6 13.6 243.7 26.8 6.5 5.8 14.2 Europe-Others 81.5 7.5 2.3 2.3 2.9 85.8 7.8 2.3 2.3 3.2 Europe Total 1,808.4 194.1 48.2 44.9 99.4 1,866.6 201.9 50.2 46.5 103.6 Iran 71.2 5.8 1.5 1.5 2.7 76.2 6.2 1.6 1.6 2.9 Israel 43.4 4.3 1.1 1.1 2.1 45.1 4.5 1.1 1.1 2.3 Pakistan 35.0 2.9 0.7 0.7 1.5 35.0 2.9 0.7 0.7 1.5 Saudi Arabia 102.2 9.4 2.4 2.4 4.5 106.2 9.9 2.5 2.5 4.8 Turkey 115.4 11.0 2.8 2.8 5.3 121.8 11.7 2.9 3.0 5.7 United Arab Emirates 48.5 5.0 1.3 1.3 2.4 51.2 5.3 1.3 1.3 2.6 Middle East-Others 130.6 11.0 3.0 3.0 5.0 137.8 11.8 3.0 3.0 5.8 Middle East Total 546.3 49.4 12.8 12.8 23.5 573.3 52.3 13.1 13.2 25.6 Canada 160.5 17.0 4.2 4.3 8.3 166.3 17.8 4.4 4.5 8.7 Mexico 138.4 14.9 3.7 3.8 7.3 146.1 15.9 4.0 4.0 7.7 United States 1,809.2 206.8 51.4 44.9 106.9 1,876.7 216.4 53.8 47.0 106.3 North America-Others 83.8 6.9 1.8 1.8 3.3 88.1 7.4 2.0 2.0 3.4 North America Total 2,191.9 245.6 61.1 54.8 125.8 2,277.2 257.5 64.2 57.5 126.1 Argentina 93.0 8.6 2.2 2.2 4.1 100.8 9.5 2.4 2.4 4.6 Brazil 283.9 26.7 6.7 6.8 12.9 297.0 28.2 7.1 7.1 13.7 Chile 33.0 3.2 0.8 0.8 1.6 34.7 3.4 0.9 0.9 1.6 Colombia 45.0 3.9 1.0 1.0 1.9 47.5 4.1 1.0 1.0 2.1 Peru 30.7 2.7 0.7 0.7 1.3 32.5 2.9 0.7 0.7 1.5 Venezuela 21.3 1.6 0.4 0.4 0.8 20.8 1.6 0.4 0.4 0.8 South America-Others 40.5 3.4 0.8 0.8 1.8 42.7 3.6 0.8 0.8 2.0 South America Total 547.4 50.1 12.6 12.7 24.4 576.0 53.3 13.3 13.3 26.3 Grand Total 10,035.6 1,014.2 254.7 245.7 503.6 10,597.9 1,080.0 271.6 261.5 530.6

Table 15. 2022 Global Third-Party Logistics Market and Segment Revenues by Country/Region (US$ Billions) 2022

2022E 2022E Logistics 2022E 3PL 2022E ITM 2022E TM Country/Region VAWD Cost Revenue Revenue Revenue Revenue

Algeria 33.4 2.7 0.7 0.7 1.3 Egypt 30.0 2.6 0.7 0.7 1.2 Morocco 20.9 1.8 0.5 0.5 0.8 Nigeria 105.8 8.0 2.0 2.0 3.9 South Africa 41.5 4.4 1.1 1.1 2.2 Sudan 44.7 3.5 0.9 0.9 1.7 Africa-Others 227.8 18.0 5.0 5.0 8.0 Africa Total 504.1 41.0 10.9 10.9 19.1 Australia 147.0 15.9 4.0 4.0 7.7 Bangladesh 60.4 5.1 1.3 1.3 2.5 China 2,567.5 278.6 70.2 70.5 135.3 Hong Kong 33.9 4.0 1.0 1.0 2.0 India 511.2 38.9 9.8 9.8 18.9 Indonesia 355.4 28.1 7.1 7.1 13.6 Japan 456.3 50.6 12.8 12.8 24.5 Macao SAR 5.6 0.6 0.2 0.2 0.2 Malaysia 63.6 4.9 1.2 1.2 2.5 New Zealand 27.9 2.8 0.7 0.7 1.4 Philippines 75.3 5.7 1.4 1.4 2.8 Singapore 29.0 3.5 0.9 0.9 1.7 South Korea 164.5 19.2 4.8 4.9 9.3 Taiwan 59.2 6.8 1.7 1.7 3.3 Thailand 77.9 6.2 1.6 1.6 2.9 Vietnam 62.8 5.1 1.3 1.3 2.5 Asia Pacific-Others 72.2 5.5 1.4 1.4 2.7 Asia Pacific Total 4,769.7 481.5 121.4 121.8 233.8 Kazakhstan 35.2 3.1 0.8 0.8 1.5 Russia 296.4 24.6 6.2 6.2 12.0 Ukraine 23.5 2.0 0.5 0.5 1.0 CIS-Others 56.7 4.7 1.2 1.2 2.3 CIS Total 411.8 34.4 8.7 8.7 16.8

Table 15. 2022 Global Third-Party Logistics Market and Segment Revenues, Cont. 2022

2022E 2022E Logistics 2022E 3PL 2022E ITM 2022E TM Country/Region VAWD Cost Revenue Revenue Revenue Revenue

Austria 41.5 4.5 1.1 1.1 2.3 Belgium 47.1 5.2 1.3 1.3 2.6 Czech Republic 28.2 2.9 0.7 0.7 1.5 Denmark 34.9 3.7 0.9 0.9 1.9 Finland 25.6 2.8 0.7 0.7 1.4 France 267.1 29.6 7.1 6.4 15.8 Germany 345.7 38.4 9.5 8.3 20.2 Greece 31.0 2.9 0.7 0.7 1.5 Hungary 19.6 1.8 0.5 0.5 0.8 Ireland 35.0 3.7 0.9 0.9 1.9 Italy 193.4 21.7 5.2 4.7 11.6 Netherlands 73.0 10.7 2.6 2.3 5.7 Norway 42.9 4.6 1.2 1.2 2.2 Poland 74.1 7.3 1.8 1.8 3.6 Portugal 27.8 2.7 0.7 0.7 1.3 Romania 38.0 3.4 0.9 0.9 1.6 Spain 140.5 14.9 3.6 3.2 7.9 Sweden 51.0 5.7 1.4 1.4 2.8 Switzerland 65.6 7.2 1.8 1.8 3.5 United Kingdom 251.8 27.9 6.7 6.1 14.8 Europe-Others 90.1 8.5 2.4 2.4 3.7 Europe Total 1,923.9 210.1 51.7 48.0 108.6 Iran 81.6 6.8 1.7 1.7 3.3 Israel 46.9 4.7 1.2 1.2 2.3 Pakistan 35.0 3.0 0.8 0.8 1.4 Saudi Arabia 108.8 10.2 2.6 2.6 4.9 Turkey 127.9 12.4 3.1 3.1 6.1 United Arab Emirates 54.1 5.7 1.4 1.4 2.8 Middle East-Others 145.9 12.6 3.1 3.1 6.4 Middle East Total 600.2 55.4 13.9 13.9 27.2 Canada 172.2 18.6 4.6 4.7 9.1 Mexico 154.1 17.0 4.2 4.3 8.3 United States 1,948.3 226.6 56.3 49.2 111.3 North America-Others 93.0 8.0 2.1 2.1 3.8 North America Total 2,367.6 270.2 67.2 60.3 132.5 Argentina 109.0 10.4 2.6 2.6 5.1 Brazil 310.4 29.8 7.5 7.5 14.5 Chile 36.9 3.7 0.9 0.9 1.9 Colombia 50.2 4.4 1.1 1.1 2.2 Peru 34.6 3.1 0.8 0.8 1.5 Venezuela 18.2 1.4 0.4 0.4 0.6 South America-Others 44.9 3.9 1.0 1.0 1.9 South America Total 604.2 56.7 14.3 14.3 27.7 Grand Total 11,181.5 1,149.3 288.1 277.9 565.7

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