The assessment of competitive intensity in logistics markets

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.