The need for efficiency and scalability has made warehouse outsourcing an essential strategy for businesses that seek to streamline their operations and concentrate on their primary areas of specialization.
As we traverse through 2024, understanding the dynamic nature of this industry is even more vital than ever before.
In this article, 24 crucial figures are discussed to present a holistic view of the state of the art concerning warehouse outsourcing today.
These statistics provide high-value insights from cost savings indices to new technologies, sector-focused consequences, and other key factors that help managers think about whether it may be advantageous for their logistics processes to be outsourced.
Whether you are a small businessman or manage a large enterprise, these statistics will equip you with the relevant information to enable prudent decision-making amidst a rapidly changing market setting.
So, without further ado, let’s see the significant warehouse outsourcing statistics you must know in 2024.
Global Warehouse Outsourcing Statistics
Global warehousing market is estimated to reach $549.3 billion by the end of 2025. (Zipdo)
The astounding statistics of the warehouse and storage market depict a dynamic and profitable industry image. It also highlights the future growth that the warehousing industry promises to businesses.
180,000 warehouses are expected to exist by 2025 due to the rapid growth in e-commerce. (Statista)
The trend of warehouse outsourcing is evolving tremendously throughout the world. Due to the expansion of e-commerce, the warehouse industry has been reshaped, setting new trends globally.
In 2000, warehouses in the US covered 9.1 billion square feet. This rate expanded to 14.5 billion square feet by the end of 2018. (JLL)
The US needs another 100 million square feet of warehouses to keep up with the sales trends and consumer demand. This is all due to the growing demand for e-commerce and shifting consumer behavior.
According to the statistics, the states with the highest number of businesses in United States Public Storage & Warehousing are California with 3,799 enterprises, Texas with 2,602, and Ohio with 1,438. (IBISWorld)
The concentration of businesses in these states is due to the local hubs of trade. Businesses located near or in these states can always benefit from improved supply chain efficiencies.
Digital Advancement of Warehouses Statistics
Technological progress such as Artificial Intelligence (AI) or the Internet of Things (IoT) are making technology more accessible, leading to the adoption of technological tools in warehouses. (MMH)
The technological strides serve as a catalyst and propel the adoption of advanced technological tools in the warehouses. As a result, more and more businesses are getting compelled to embrace warehouse automation.
By 2026, the global warehouse automation market is estimated to exceed $30 billion compared to $15 billion registered in 2019. (Statista)
This statistic highlights the doubling of warehouse automation market size. This is because warehouse automation eliminates human error and makes tasks more efficient.
In the last two years, 82% of warehouses have made advanced technology purchases to run their operations smoothly and more efficiently. (Tech Waves)
A significant number of businesses are upgrading their technology to streamline their warehouse operations. Companies that are not considering advanced technology purchases may fall behind.
According to a survey, 89% of businesses will be using modernized warehouse management systems for labor planning by the end of 2024. (WERC)
Cross-border e-commerce is growing which will eventually increase the demand for modern warehouses run by automated systems. Also, businesses should integrate these solutions to improve labor productivity.
By the end of 2030, it is estimated that robots and other Artificial Intelligence (AI) tools will replace warehouse jobs by 40%. (McKinsey)
The rate at which robots are estimated to replace jobs is indeed threatening. However, it also suggests opportunities for companies to reduce labor costs while bringing precision to their warehouse operations.
It is estimated that by the end of 2030, 40% of all parcels will be delivered through drones and autonomous vehicles. (Allied Market Research)
These statistics indicate the evolution of delivery channels. Businesses should be prepared for a shift towards transportation that is faster and more cost-effective.
Third-Party Logistics Warehouse Statistics
The market of the U.S.’s Third-Party Logistics (3PL) industry surpassed $204 billion in 2019. (Statista)
The third-party logistics and warehousing market in the US has emerged as a winner with immense growth in the past few years. This also reflects the increasing demand for logistic services in the expansion of the warehousing sector.Â
Domestic transportation is the most frequently outsourced supply chain function making up around 86% of total outsourced activities. (3PL Study)
While domestic transportation is marked as the number one outsourced supply chain function, warehousing falls in second place with 66% and freight forwarding in third with 44%. Businesses should optimize their contracts with logistics to ensure efficiency.
The demand for cold chain capacity is expected to increase over the next three years. (3PL Study)
According to a report, 84% of third-party logistics and 82% of shippers have predicted this increase in cold chain capacity requirement.
In the next three years, about 72% of third-party logistic warehouses plan to expand their cold chain capacity. (3PL Study)
This high percentage is due to the increasing demands of growing e-commerce. Warehouses are compelled to expand their cold chain capacities to ensure that they can handle the increased volume of products efficiently.
Warehouse Operations and Safety Statistics
89% of distribution centers use racks and shelving, while 85% rely on forklifts. (Robotics247)
These statistics highlight that businesses heavily rely on traditional storage equipment. However, companies should upgrade to newer and more efficient equipment to conduct warehouse operations seamlessly.
Labor costs take around 50% to 70% of a company’s warehousing budget, making it the highest operating cost in a warehouse. (Kane is Able)
Labor costs have been dominating the warehouse budget for ages. However, with the help of workforce training programs and automation, labor costs can be reduced.
According to a survey, 38% of U.S. companies are expected to add more SKUs and barcode scanners to make inventory operations flawless. (G2)
These statistics clearly depict that businesses are in pursuit of advanced inventory management technologies like RFID to achieve accuracy and enhance precision. It also raises the standards of their operations and streamlines them.
As per the report, in 2018, the average number of SKUs in warehouses increased to 13,985. (Logistic Management)
The increase in the number of SKUs highlights the evolving challenges in inventory management. Besides, it also depicts the growing number of products stored in the inventory.
87% of businesses are estimated to expand their warehouses by 2024. (Zebra Technologies)
This shows that the decision-makers in the warehousing industry are facing the challenge of limited spacing, as the average size of a warehouse is 181,370 square feet.
Warehouse rents increased by 20% from the fourth quarter of 2021 to the first quarter of 2022. (CBRE)
Due to the increased demand for warehouses and cold storage, in certain areas of the US, warehouse rents increased a little over $12 per square foot.
Warehouse Labor Statistics
65.9% of the workers in the warehousing and transportation industry are male. (DataUSA)
These statistics highlight the gender dynamics within the operational landscape of the warehousing and transportation industry. It also suggests the possible areas of diversifying the workforce to get more skillful workers.
The average age of the employees working in the warehousing and storage sector is 38.3 years. (DataUSA)
By understanding workforce demographics, businesses can develop programs to ensure that strategies align with capabilities.
In warehouses, full-time labor works for 42.2 hours, and part-time labor work for 23.1 hours. (DataUSA)
Full-time warehouse employees earn an average salary of $42,352 per year while part-time employees earn around $19,948 annually. Businesses should consider these statistics while planning their workforce and budgeting strategies.