Freight Forwarding Services Industry Overview

Excerpt from Freight Forwarding Services Report

The US freight forwarding services industry includes about 20,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $50 billion. Major companies include CH Robinson Worldwide, Expeditors International of Washington, FedEx Trade Networks, UPS Supply Chain Solutions, and UTi Worldwide. The US industry is fragmented: the top 50 companies account for about a third of revenue.

Competitive Landscape

Demand is driven by domestic manufacturing output and levels of international trade. The profitability of individual companies depends on efficient operations, extensive relationships in shipper and carrier networks, and industry expertise. Large companies have advantages in account relationships and access to advanced logistics technologies. Small operations can compete effectively by serving a local market, specializing in cargo transfer with specific countries, and facilitating the transport of unusual goods.

Products, Operations & Technology

Major services are freight forwarding and customs brokering. Unlike fully integrated carriers that own truck, rail, air, or ocean assets and transport cargo, freight forwarders arrange the transportation of goods without owning any transportation equipment or handling ("fingerprinting") the cargo. Customs brokers add another layer of expertise by facilitating the clearing of goods through international customs barriers. Most companies specialize in either freight forwarding or customs brokering, though companies and individuals can provide both.