South Korean logistics industry is defined as an industry which, by function or business segment, is related to cargo transportation, storage, and off-loading, packaging and related activities. In terms of national logistics spending, the Korean logistics industry has steadily expanded since 1990 on the back of growing logistics volume, an increase in value-creating logistics activities, growth in logistics outsourcing and government efforts to enhance the logistics infrastructure. In terms of sales, the logistics industry is the 9th largest industry in Korea during 2012. As of 2012, the Korean logistics industry had about ~ companies (4.9% of the total industry), employed ~ individuals (3.1% of the overall South Korea employment) and recorded USD ~ billion in sales revenue (2.7%). Busan is home to Korea’s largest port complex, and the freight rail corridor connecting it directly to Seoul is a heavily utilized trunk line of the country’s distribution system.
The Korean logistics market has been continuously growing. In recent years, the dominance of first-party logistics and second-party logistics has been declining, whereas third-party logistics has been growing at an alarming rate in the country. South Korea logistics market witnessed varied trends over the years growing from USD ~ billion during 2011 to USD ~ billion during 2013. The market witnessed a downfall to USD ~ billion during 2014 and has been growing at a slow growth rate since then. During 2016 the logistics market of South Korea reported USD ~ billion of revenue. The freight forwarding sector is the leading segment in terms of revenues in South Korea logistics industry
The logistics industry encompasses several components such as transportation, warehousing, and value added services of which transportation forms the major proportion of the industry in South Korea.
How Freight Forwarding Market of South Korea is Performing?
South Korea freight forwarding market has witnessed varied growth over the years. South Korea’s economy is highly co-related with EX-IM flows which have affected the freight forwarding industry during 2011-2016. Expanding e-commerce, retail, manufacturing and express delivery industries has positively augmented the freight forwarding market in South Korea. Freight forwarding market of the country has dominated the overall logistics industry with percentage share of ~ in terms of revenue during 2016. To enhance economic growth of the country and to improve FDI, South Korea introduced Free Trade Zone and Free Economic Zone in the country which eased the policies for foreign companies to do business in South Korea.
Sea freight movement has majorly dominated the market for Logistics in South Korea. The increase in the trade scenario in the country has attributed to the domination in revenue share of sea freight. The rising import and export value from other countries has triggered the demand of sea freight in the country.
Ankur Gupta, Head Marketing & Communications
ankur [@] kenresearch.com