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Logistics Costs Rose to a Record $1.5 Trillion Last Year
Logistics spending rose to a record of nearly $1.5 trillion in 2017, an increase of 6.2% from the year before, according to research by the Council of Supply Chain Management Professionals. By comparison, that’s roughly $250 billion more than was spent on logistics in 2008.
The annual State of Logistics report detailed how much went to transportation and warehousing in an environment where both demand and prices are going up – especially since the middle of last year. That accounts for spending on trucking, rail and air transportation, parcel carries as well as industrial storage space.
The load doesn’t appear to be getting any lighter, either. A.T. Kearney’s Sean Monahan, one of the authors of the report, told the Wall Street Journal, business expenses are expected to grow in the coming year due to rising interest rates, the higher price of fuel and impending tariffs on imports. The cost to ship goods and products will likely grow faster than GDP this year, notes Monahan.
The continued growth of e-commerce pushed parcel shipment volume up by 7% in 2017, to nearly $100 billion. That’s forecast to rise at similar levels for the next few years, according to the report.
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