Massive potential exists in the Chinese logistics market for integrated contract logistics companies. This is one of the key findings of a new survey by Transport Intelligence contained in its latest report China Logistics 2006. The survey comprised interviews with over 230 senior professionals representing a cross section of logistics users and providers with operations in China.

According to the survey, 68% of respondents from logistics companies believed that out-sourcing was having a 'noticeable' or 'major' impact on their businesses. When questioned further 76% of respondents stated that the majority of their out-sourced logistics business was derived from multi-national manufacturers with the remainder being generated by locally based Chinese companies.

Another of the findings of the survey was the extent to which the trend towards out-sourcing could still develop. 48% of respondents indicated that they out-sourced none or just some of their logistics.

Chief Analyst, John Manners-Bell commented: 'Out-sourcing will be the defining trend behind the growth of the Chinese logistics industry over the coming few years. Our survey has identified that increasing numbers of manufacturers and retailers are looking to out-source to integrated logistics providers due to cost advantages as well as their greater understanding of local markets and regulations. The greatest potential lies with domestic Chinese shippers rather than multinationals which have been amongst the earliest adopters. However competition for this business will be fierce as domestic logistics companies are now increasingly seen as a viable alternative to western and Japanese providers.'