The cold chain logistics market is expected to grow at a CAGR of 18.9% from 2024 to 2030. The worldwide increase in demand for perishable items which are required to be stored and transported at an appropriate temperature to maintain their freshness and quality has led to the increase in demand for these services. Good cold chain logistics networks, which involve effective collaboration between suppliers, transportation providers, and customs officials to ensure timely delivery and compliance with international standards, are crucial in meeting the demand for fresh items across borders. The Food Safety Modernization Act of 2011 is responsible for the majority of cold chain logistics operations. This law has increased the Food and Drug Administration's control over product handling and transportation from the manufacturer to the store to the customer. The law requires shippers, loaders, motor or rail vehicle carriers, and receivers of these perishable items to employ sanitary practices to assure the food's safety.
Technologies such as RFID tags and blockchain are used in this category. DHL tracks the movement of temperature-sensitive goods across the supply chain using RFID tags. It can be used to ensure the integrity of shipments. This is because RFID tags can be used to verify the authenticity of goods and to detect any tampering. These tags can resist the extreme conditions of the cold chain since they are more robust than barcodes. They can be used to track products in real-time, assisting in preventing loss or misplacing and ensuring that they arrive at their destination on schedule. FedEx uses blockchain to monitor the supply-chain movement of goods that are sensitive to temperature. This makes it easier to make sure that the goods are undamaged and continue to be at the right temperature. It alsoprovides transparency into the cold chain process, which means that all stakeholders in the supply chain can see the data and track the movement of the products.
This category is a highly fragmented industry, with a large number of small and medium-sized businesses that operate in this sector. The industry is characterized by a diverse range of companies including logistics providers, temperature-controlled packaging manufacturers, and refrigeration equipment suppliers. It is difficult to develop and maintain temperature-sensitive transportation that requires specialized equipment, facilities, and expertise. The risk of foodborne illness and product deterioration can be prevented by the cold chain process. This is because there are greater chances for things to be tampered with or affected by temperature changes.
Order your copy of the Cold Chain Logistics Procurement Intelligence Report, 2024 - 2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis
Businesses generally use cost-plus pricing method that involves adding a markup to the cost of providing the service, which is typically based on the cost of transporting goods, as well as any additional expenses incurred by the logistics provider. The logistics provider frequently decides on the markup based on their intended profit margin and takes into account the industry's competitive environment. The equipment cost, which includes refrigeration units and temperature monitoring devices needed to preserve the integrity of temperature-sensitive commodities during transit, makes up the majority of the cost components in this category. Cost of labor, which includes paying employees to handle and transport commodities. The average labor cost range between USD 25 - USD 30 per hour. A typical refrigerated truck costs roughly around USD 170,000 and the price rises as the size and dimensions increase.
Due to the wide variety of items that need to be transported and stored at a controlled temperature, the United States is a significant market for cold chain logistics. This includes pharmaceuticals, fresh food, and medical supplies. They have a proven track record of innovation in the field of cold chain logistics, having created innovations like temperature-controlled cars and IoT. The recent rapid economic expansion in China has increased the demand for products in this category. The middle class in the nation is expanding quickly, and customers are reaching for more and more high-quality, fresh foods. The growth of this industry is being supported by the Chinese government. In order to encourage the use of cold chain logistics, the government has invested in the development of cold storage facilities and implemented legislation. The best sourcing practice in this category is to work with suppliers who have the expertise and resources to handle cold chain products and a good track record of maintaining the required temperature ranges throughout the supply chain. It is also important to have a contingency plan in place to mitigate any disruptions and ensure the quality and safety of the products being transported.
Cold Chain Logistics Procurement Intelligence Report Scope
• Cold Chain Logistics Market Growth Rate: CAGR of 18.9% from 2024 to 2030
• Pricing growth Outlook: 9 - 10% (Annual)
• Pricing Models: Cost plus pricing model and value-based pricing model
• Supplier Selection Scope: Cost and pricing, Past engagements, Productivity, Geographical presence
• Supplier selection criteria: Customer service, price, delivery time, flexibility, reliability, experience, technical specifications, operational capabilities, regulatory standards and mandates, category innovations, and others.
• Report Coverage: Revenue forecast, supplier ranking, supplier matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model
Browse through Grand View Research’s collection of procurement intelligence studies:
• Supply Chain Insurance Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)
• Industrial Robotics Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)
Key companies profiled
• FedEx
• DHL
• CMA CGM
• Maersk
• Kuehne Nagel
• Americold Logistics
• XPO Logistics
• Safmarine
• Evergreen Line
• CH Robinson Worldwide
Brief about Pipeline by Grand View Research:
A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions.
Our services include (not limited to):
• Market Intelligence involving – market size and forecast, growth factors, and driving trends
• Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
• Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
• Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions
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