Skip to main content
SpringerLink
Log in

The assessment of competitive intensity in logistics markets

  • Original Paper
  • Published:
Logistics Research

Abstract

The markets for freight transportation and other logistics services are undergoing rapid transformation: concentration of demand and supply in the hands of fewer, larger shippers and service providers, new business models of highly integrated intermodal, “fourth-party” and supply-chain wide logistics service offerings, and a dramatically increasing volatility in the general economic environment are among the reasons for the changes. As a consequence, the “strategic” task of assessing the opportunities and power of certain players in the markets, and the important political and judicial task of assessing and maintaining competition in those markets have become very difficult. Traditional ways of meeting the challenges involved with defining and “measuring” markets and competitive intensity do not seem to be sufficient any more. This paper reports on a study of the new challenges, which strategists, administrators, judges, and politicians face in their efforts to assess competitive situations in logistics markets. It develops suggestions for a consistent and practical process and structure of defining and measuring logistics markets and market positions.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3
Fig. 4
Fig. 5
Fig. 6
Fig. 7
Fig. 8

Similar content being viewed by others

Notes

  1. Wilson [24] estimated the depressed 2009 volume for the US at $ 1095 b. (corresponding to € 912 b at an assumed exchange rate of 1.20 $/€, which is considered a realistic long-term Dollar/Euro equivalent), while Klaus et al. [12] estimate he comparable volume of the 27 nations of the European community, plus Switzerland and Norway, at € 880 b. After-recession” figures for the year 2010 are anticipated to come out about 5% higher.

  2. For example, through the shift of control over logistics services from hundreds or even thousands of consumer goods suppliers to newly formed “inbound” logistics systems by the big retail chains such as WALMART; METRO or REWE. See, e.g., the DVZ-Newsletter No. 18 of 2.5.09 “Aldi is Working on New Procurement Logistics System”.

  3. Compare the annual lists of merger activities in the logistics sector such as the KPMG “M&A Update—Transport & Logistics” under www.kpmg.de, as well as Klaus et al. ([12] S. 68 ff.).

  4. Compare current business reports by formerly state-owned Deutsche Post as “DHL”, the Dutch post office as “TNT”, the British postal service as “GLS” or the French railway system through “GEODIS”.

  5. Compare: the annual studies by Langley and Cap Gemini ([14], 2010) “The State of Logistics Outsourcing”.

  6. Note the historical development of classic international carriers such as KÜHNE & NAGEL, SCHENKER or HELLMANN into integrated logistics providers, or the transformation of medium-sized transport companies such as BETZ, GEIS, DSV, FIEGE or RHENUS into diversified contract logistics providers. For sources and references see the “Top 100” company profiles in Klaus et al. [12].

  7. European examples are ARVATO, a subsidiary of the Bertelsmann Group; HERMES, a subsidiary of the OTTO retail group, and Rail4Chem, which grew out of the BASF chemical corporation.

  8. The most obvious manifestations of the new economic volatility were the “New Economy Boom” about the year 2000, and the worldwide financial and economic crisis of 2008/2009.

  9. The full study has been published in German and English language [13]. In this paper it is referred to as “the study”.

  10. Bulletin C 372 of 09.12.1997 by the European Commission regarding the definition of a relevant market.

  11. This customary term refers to the globally active express freight carriers such as UPS, FEDEX, DHL and TNT.

  12. Cf. Neiser [19].

  13. Cf. Beckmann [3], also Arnheim [2].

  14. See Form A/B to regulation No. 17 and Section V of Form CO to Regulation (EEC) Nr. 4064/89 on the control of mergers of companies with community-wide significance.

  15. Cf. Neveling [20].

  16. Cf. Neveling [20].

  17. This corresponds well to the American management professor Bowman’s [5] definition of “Strategic Management”. He demanded that effective strategic management is “seeking for a time a “localized monopoly”, (which) “makes the market less perfect, disturbs the equilibrium, and earns for a time excess profits”… “Corporate strategy can be conceived of as continuing search for rent, where rent is intended in the sense of returns to a “unique place”.

  18. Cf. Schmidtchen [21, 22] and sources quoted there.

  19. Cf. BGH, WuW/E BGH 2433, 2436f. “Gruner & Jahr: Zeit II, and WuW/E BGH 2150, 2153 “Stainless Steel Cutlery”.

  20. Leaflet on controlling merges be the German Cartel Office, Policy Directorate, July 2005, p. 14.

  21. i.e. “the study” by Klaus et al. [13].

  22. e.g. the VerkStatG, BStatG—a popular collection of statistical data relating to transport and logistics in is the annual “Verkehr in Zahlen” (Transport in Figures) published by BMVBSt (latest: BMVBSt 2009).

  23. Cf. http://ec.europa.eu/competition/mergers/cases/index/m31.html.

  24. Multiple coding was permitted.

  25. More details on the analysis of competition law related decisions by the European Commission are presented in “the study” [13, section 4.2.1].

  26. i.e. distinguished “from the road freight market”.

  27. cf. [13].

  28. First published in 1997 from Deutscher Verkehrs-Verlag, Hamburg: the latest English-language edition published is “Top 100 in European Transport and Logistics Services 2009” [12], the latest German-language “Top 100—2010” [13].

  29. Cf. e.g. the comments on “Gueterverkehr und Logistik” on the homepage of the Federal Ministry of Transport, Building and Urban Planning and the remarks of the German Chancellor on the importance of logistics to Germany as a business location during her inaugural address to the 24th BVL Congress in Berlin in 2007.

  30. There are numerous studies of specific market segments and aspects, such as those by the business consultants MRU Manner-Romberg [16] for the CEP markets, and the commercial market research reports by British transport and logistics market research companies Datamonitor and Analytica, as well as Ehmer et al. (2008).

  31. The German transport industries‘associations such as “Bundesverband Güterverkehr, Logistik und Entsorgung BGL”, the former “Bundesverband Spedition und Lagerei BSL”, now “Deutscher Speditions -und Logistikverband DSLV”, “Verband Deutscher Eisenbahnunternehmen”, “Bundesverband internationaler Express- und Kurierdienste”, “Verband Deutscher Reeder” especially for the interests of industry and carriers, “Bundesverband Materialwirtschaft und Logistik” BME.

  32. The current edition is Wilson [24]. Its elementary logistics definition was originally suggested by Heskett [10]. Other international work using similar definition is Davis [7] or Bowersox et al. [4].

  33. Such as Eurostat and the Statistisches Bundesamt of Germany. See. Klaus et al. [12] for detailed explanations and references.

  34. There is deliberately no account of “alternative technologies” here because a needs- and demand-based perspective of market assessment should include the substitution options based on the availability of alternative technologies).

  35. According to this demarcation, the total annual volume for the geographical area under consideration can be calculated (in this case € 200 billion for all logistical services in Germany in 2009). The other data presented are the orders of magnitude taken from Klaus et al. [12] and consolidated for the purposes of Illustration.

  36. Short-haul transport refers to local and regional operations where vehicles typically operate from a local basis to which they return within one shift. Short-Haul/Short-Line operations are quite distinct organizationally and with respect to equipment used from Long-Haul operations.

  37. The data used here are drawn from a recent study of the European full truckload market [11].

References

  1. Abbot L (1955) Quality and competition. An essay in economic theory. Columbia University Press, New York

    Google Scholar 

  2. Arnheim E (1991) Der räumlich relevante Markt im Rahmen der Fusionskontrolle. Heymanns Verlag, Münster

    Google Scholar 

  3. Beckmann P (1968) Die Abgrenzung des relevanten Marktes im Gesetz gegen Wettbewerbsbeschränkungen. Gehlen Verlag, Berlin Zürich

    Google Scholar 

  4. Bowersox DJ, Calantone Roger J, Rodriguez Alexandre M (2003) Estimation of global logistics expenditures using neural networks. J Bus Logist 24(2):21–36

    Article  Google Scholar 

  5. Bowman EH (1974) Epistemology, corporate strategy and academe. Sloan Manag Rev 15. Jg.

  6. Clark JB (1901/1980) The control of trusts. Macmillan and Co., Englewood Cliffs

  7. Davis HW, Company (2007) Aktuelle Fortschreibung der Davis Database, Präsentation anlässlich der Jahreskonferenz des Council of Supply Chain Management Professionals (CSCMP), Oct 2007

  8. Ehmer P, Heng S, Heymann E (2008) Logistik in Deutschland. Wachstumsbranche in turbulenten Zeiten”, Hrsg. Deutsche Bank, Frankfurt, Okt. 2008

  9. Hayek FA (1952) Der Sinn des Wettbewerbs. In: Hayek, Individualismus und wirtschaftliche Ordnung, Erlenbach und Zürich. S. 122–140

    Google Scholar 

  10. Heskett J (1972) Interorganizational problem solving in a channel of distribution. In: Interorganizational decision making, conference, Chicago

  11. Klaus P (2010) Mächtig, unbeliebt, unprofitabel—und wenig verstanden? Der LKW Ladungsverkehr in Europa und seine Zukunft. In: Festschrift für Hans-Christian Pfohl. Gabler Verlag, Wiesbaden, im Druck

  12. Klaus P, Hartmann E, Kille C (2009) Top 100 in European transport and logistics services 2009. DVV Medien, Hamburg

    Google Scholar 

  13. Klaus P, Kille C, Roth M (2010) The intensity of competition in European markets for logistics services. Fraunhofer Verlag, Stuttgart

  14. Langley CJ Jr, CapGemini/USA (2010) The state of of logistics outsourcing—2007 third-party logistics, results and findings of the 12th annual study. Georgia Tech, Atlanta Ga., USA

  15. Levitt T (1960) Marketing Myopia. Harvard Business Review, Repr. July–Aug 2004, p 138

  16. Manner-Romberg H et al (2009) Primärerhebung auf den Märkten für Kurier-, Express- und Paketdienste. Im Auftrag der Bundesnetzagentur. MRU GmbH, Hamburg

    Google Scholar 

  17. Marshall A (1890) Principles of economics. Macmillan and Co., London

    Google Scholar 

  18. Müller C (2007) Abschied vom Bedarfsmarktkonzept bei der Marktabgrenzung. Nomos Verlag, Baden-Baden

    Google Scholar 

  19. Neiser J (1981) Die Praxis der deutschen Fusionskontrolle: die deutschen Erfahrungen bei der wettbewerbsrechtlichen Beurteilung von Unternehmenszusammenschlüssen unter Berücksichtigung der amerikanischen Praxis Duncker Humblot, Berlin

  20. Neveling K (2003) Die sachliche Marktabgrenzung bei der Fusionskontrolle im deutschen und europäischen Recht. Medien Verlag Köhler, Tübingen

    Google Scholar 

  21. Schmidtchen D (2005a) Der more economic approach in der Wettbewerbspolitik. In: German working papers in law and economics, Vol 2005. p 6

  22. Schmidtchen D (2005b) Effizienz als Leitbild der Wettbewerbspolitik: Für einen more economic approach. In: Encyclopedia of law and economics, vol 2005, Issue 1, Article 3

  23. Smith A (1776/1981) An inquiry into nature and causes of the wealth of nations. J.M. Dent & Sons Ltd. Everyman’s Library, London

  24. Wilson R (2010) State of logistics report 2010, Ed. Council of Supply Chain Management Professionals (CSCMP), Oak Brooks, Ill

Download references

Author information

Authors and Affiliations

  1. Friedrich-Alexander-Universitaet Erlangen-Nuernberg, Nuernberg, Germany

    Peter Klaus

Authors
  1. Peter Klaus
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Peter Klaus.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Klaus, P. The assessment of competitive intensity in logistics markets. Logist. Res. 3, 49–65 (2011). https://doi.org/10.1007/s12159-011-0050-0

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s12159-011-0050-0

Keywords

Search

Navigation