Logistics and transportation is an intricate puzzle of interconnected routes, carriers, shippers, modes, and supply chains.

Delivering success requires these pieces to fit seamlessly together. However, the complexity of modern operations extends beyond just the physical networks.

Survey details

The 33rd Annual Study of Logistics and Transportation Trends surveyed more than 200 industry practitioners, 85% of whom had 15 or more years of industry experience, and 80% serve in C-level, vice president, director, or managerial roles. Participants represent organizations with fewer than 100 to more than 5,000 employees and annual revenues ranging from less than $250 million to more than $9 billion.

Today’s logistics and transportation professionals must navigate challenging market conditions and an evolving regulatory environment while competing for talent and continuously evaluating new and emerging technologies. Missing or neglecting even one piece of this puzzle can cause operational disruptions, inefficiency, and missed opportunities.

The 33rd Annual Study of Logistics and Transportation Trends explores these pieces, revealing insights into how industry leaders are working to navigate this puzzling environment and shape the path forward.

This year’s study examines transportation spending, competitive strategy, and performance in order to better understand how firms are executing and
differentiating themselves.

Market conditions

Spending. Transportation spend is a large piece of the logistics puzzle. This year, spending on private fleets dropped 50% to 7.23% of transportation spending, down from a six-year high of nearly 15%. Truckload (TL) spending has slowly increased while spending on dedicated fleets and less-than-truckload (LTL) services saw slight declines. Intermodal transport posted its highest percentage of spending over the last decade at 6.5%, while air, domestic ocean, and barge freight all increased last year.

What about the Titans, those shipper operations in companies with sales over $3 billion? These large shippers have more in common with the overall trends than they do differences. The Titans differ mainly in spending less on small package (less than 2% of spend) and LTL (under 5%). This makes intuitive sense, as larger firms are more likely to ship larger quantities, thus requiring fewer small package and LTL services.

Strategy. Competitive strategy is another crucial piece of the operational environment. The most notable trend is the continued dominance of the “Mix: Be all things to all people” strategy, which remains steady at 54.6%. We believe this reflects the continued prioritization of flexibility to meet various customer needs.

In contrast, cost leadership strategies have substantially declined from 7.4% in 2019 to 3.1% in 2024, highlighting less emphasis on competing primarily through lower prices. Meanwhile, customer service remains an essential strategy for 22.7% of the companies in 2024, up from 21.7% in 2023.

More than 19% of responding shippers are now opting for a product and market innovation-focused strategy, up from just 9.3% in 2019, recognizing innovation as an increasingly important competitive differentiator.

Performance. This year’s study revealed declines in all four tracked performance measures from 2023, with many of the metrics at their lowest levels in three years. When comparing their performance to competitors, shippers reported declines in firm profitability (3.48 in 2024, down from 3.74 in 2022) and return on assets (3.5 in 2024, down from 3.65 in 2022). Although customer satisfaction levels remained high (3.99 in 2024), competitive positioning (3.59 in 2024) and revenue growth (3.58 in 2024) were both down from 2023 and 2022.

Regulatory requirements

A dizzying array of government policies and regulations—which often add complexity and cost while requiring new technology and training—constitute another challenging piece of the puzzle. We included questions in this year’s study to determine the regulations that may have the most impact on operations.

Respondents were presented with various regulations and asked to indicate their impact on firm operational costs. In the survey, 64% of respondents indicate that regulations had increased operational costs by 1% to10%, while 21% say regulatory burdens increased their costs by 10% or more.

Environmental, economic/financial, and trade/customs regulations had the greatest impact on cost. Respondents believe these will continue to affect their bottom line over the next one year to three years, and they also believe that labor and employment regulations will play a
significant role. This concern is likely driven by independent contractor classification rules, such as California’s AB5, and truck driver minimum wage disputes.

Technology

Technology is another pivotal piece of the logistics and transportation puzzle. Companies must carefully consider new technologies that align with business strategy and cost-effectively deliver desired results. This year’s study provides insights into which technologies shipper organizations are adopting; drivers of their adoption decisions; and impacts of recent technology adoptions.

Technology adoption. The study found that 54% of respondents are using or implementing back-office automation, with another 19% planning to adopt it within 12 to 24 months. This focus on back-office automation represents a 16.2% increase in current usage from 2023.

These findings are consistent with the broader industry trend of technology investments to help streamline administrative processes and routine tasks. Participants also report the adoption of safety-related technologies (36.5% using or implementing) as well as predictive and optimization-related technologies to support improved forecasting (38.1% using or implementing) and route optimization (31.7% using or implementing).

Logistics and transportation operations seem more cautious when adopting more advanced technologies like autonomous vehicles (6.3% using or implementing) and warehouse automation (14.3% using or implementing).

Adoption drivers. Logistics and transportation operations primarily adopted technology to improve employee productivity (88.9%). Additionally, logistics operations desired technology to improve employee engagement and retention (73%).

It’s worth noting that the top two drivers are both employee-focused, reflecting intentional efforts by companies to improve employee performance and enhance the work environment. Only 39.7% of the study participants indicate that technology was adopted as part of an effort to reduce employee headcount.

Technology benefits. It appears that most companies are achieving their employee-focused goals. More than 84% agree that recent technology adoptions have enhanced efficiency, and 76.2% reported improvements in employee productivity.

Participants also report improvements in visibility (73.0%), quality (76.2%), speed (65.1%) of decision-making, and reduced operational costs (60.3%). Participants also indicate that technology adoption makes a positive impact on employee engagement (54%) and retention (50.7%).

Authors:

• Christopher A. Boone, PH.D., Associate Professor, MISSISSIPPI STATE UNIVERSITY
• Karl B. Manrodt, PH.D., Professor, GEORGIA COLLEGE AND STATE UNIVERSITY
• Douglass Voss, PH.D., Professor and SCOTT E. BENNETT ARKANSAS HIGHWAY COMMISSION ENDOWED CHAIR, UNIVERSITY OF CENTRAL ARKANSAS
• Joseph Tillman, Manager Education Programs, SMC3

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