Advantages of Logistics Clearly Evident in Booming Global Market

Advantages of Logistics Clearly Evident in Booming Global Market

Categories: BCO/Shipper.

While the election of Donald Trump as President of the United States has largely occupied the minds of logistics providers, the news from overseas paints a positive picture about advantages of logistics in the global market. According to the Wall Street Journal, warehousing giant Global Logistic Properties Ltd. has announced that it is in preliminary talks with various parties to sell itself — just one option under a continuing strategic review.

While details remain under wraps and shareholders have been warned that there is no guarantee of any transaction, the company – which is the second-largest operator of warehouses in the U.S. and boasts an impressive $7.5 billion market capitalization – halted trading in its stock in early January. Word of the possible sale spread quickly, driving GLP’s stock up 7.1%.

Biggest Ever Buyout

The possible takeover of the Singapore-based company could be one of the biggest-ever buyouts in Asia Pacific, an exciting prospect for domestic onlookers. According to Bloomberg, the transaction would simply be the most recent in the last 12 months, which has seen $215 billion of property and property-related deals involving firms in the region. This would truly bring into focus the advantages of logistics in the booming global market.

“I wouldn’t be surprised if they attract interest — they have a very strong network of assets,” David Smith, the Singapore-based head of corporate governance at Aberdeen Asset Management Asia Ltd., which owns GLP shares, told Bloomberg. “The business has ‎great potential driven by demand for modern logistics assets. They’ve been executing well.”

E-Commerce Driving Bold Moves

Much of this boldness seems motivated by logistics’ strong links to e-commerce, which has taken the global market by storm. As retailers – both brick and mortar and online – continue to see strong sales numbers and turn to third party logistics providers to facilitate shipping and warehousing, global warehousing companies with broaders portfolios will be in hot demand.

GLP perfectly demonstrates the desirability of such a company, with Bloomberg reporting the company owns and operates $40 billion in global real estate – including $12.8 billion of assets in China and $10.5 billion in Japan.

Logistics Overseas and at Home

With its Asia Pacific base of operations, the GLP and it’s ilk are ideal partners with local and overseas e-commerce companies, including Chinese e-commerce giant Alibaba. Alibaba recently announced a partnership with the world’s largest logistics network, WCA Ltd., with the company acting to vet and approve international logistics providers for the customers of Alibaba.com.

“Many of our member companies are already heavily involved in many facets of cross-border e-commerce logistics,” Dan March, WCA’s chief executive officer, said in a statement. “The strict qualification process for our newly-formed WCA e-commerce network will provide reassurance that the services provided by our members can facilitate merchants on Alibaba.com to accelerate their global trading.”

As global e-commerce providers expand their reach, logistics providers from overseas look to make their homes in the U.S. Turkish warehouse management software firm LA Software company recently opened its North American headquarters in Chicago.

“We selected Chicago as our base because, location-wise, it’s the perfect spot for North America,” Cagdas Yildiz, co-founder and executive vice president of LA Software, told Built In Chicago. “We are very close to the East Coast, we are close to the West Coast, so it’s a great location for us.”

As the global market continues to improve, bringing with it more jobs in logistics, the advantages of logistics grow more evident every day. This is likely to be a first step on the path to a more globally integrated marketplace, with local coordination leading to more cost effective solutions.

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