Main trends in logistics in 2025

LOGISTICS TODAY

The logistics market has changed dramatically since the pandemic, and the change has been constant in recent years. The logistics sphere still continues and will remain dependent on international players and the geopolitical environment, which only escalated and worsened during the Covid era and even more throughout the Russian special military operation - tensions have only increased. Despite this, the market is adapting by circumventing existing obstacles. It is akin to a chaotic fire moving through gaps or a rushing river rounding obstacles. I often talk about the concept of “weathervane” (the inability of many participants to adapt and change quickly in response to external conditions): some react quickly to change, while others are unprepared for the new conditions. Attempts to automate border crossings and simplify document flow remain fruitless. This, of course, affects the cost, turnover dynamics and project implementation. Attempts to introduce import substitution have also failed to produce the expected results. This is due to the fact that attention and resources are focused on maintaining the defense complex and there is a banal shortage of good managers. The situation is aggravated by the growing number of enterprises closing down. According to FinExpertiza, in 2022, the number of closures of commercial organizations exceeded the number of openings by 13.6% (38,100 companies). The logistics market will face uncertainty. But, it is necessary to remain optimistic, rely on facts and be flexible. Then adaptation to new conditions will be less painful.

1) MONOPOLIZATION

This trend continues to persist. Large companies are buying up small businesses. They build up their resources, build new ships, acquire vehicles, railroad equipment, their own platforms and containers. The major players are actively building their terminals and warehouses in an attempt to establish closed supply chains, allowing them to control the market even more. “Shipping group CMA CGM S.A. (CMA CGM Group) has announced its firm intention to make an offer to acquire for cash all the outstanding shares of Neptune Orient Lines Limited (NOL). The voluntary offer is made following the satisfaction of all pre-conditions and the waiver of special rights set out in the preliminary offer statement issued on December 7, 2015, the French shipping company said in a statement.” (Source: PortNews) “On November 30, Maersk closed the deal to acquire Hamburg Süd. All formal approvals have been received.“The Maersk Line fleet will comprise 105 Hamburg Süd vessels. The combined fleet will consist of 772 vessels, owned and chartered.” (Source: PortNews). Large companies can afford to work without attracting credit funds, but use their own fixed assets, optimize all supply chains, which allows to reduce the cost of production and, therefore, dumping and offer more favorable conditions for customers. Unfortunately, small and medium-sized businesses cannot withstand this competition and will either go bankrupt or be taken over.

2) INFLATION AND RISING PRICES

Inflation and rising credit rates have a significant impact on the market. In addition to the increase in transportation tariffs, equipment rental prices (gondola cars, containers, platforms) are also increasing. It should be noted that tariffs are increasing not only for operators, but also for railroads.

“Starting from 2010 and until 2021, Russian Railways tariffs were indexed once a year - from January 1. In 2022 there were two increases from 01.01.2022 by 6.8% and from 01.06.2022 by 11%. The total increase for 2022 (December to December) was therefore an increase of 18.6%. In 2023, there were two increases: from 01/01/2023 by 10.09% and from 01/12/2023 another increase of 10.75%.” (Source)

These increases affect the final cost of goods. Price increases can be related to both inflationary processes and informal arrangements between large companies. The big players are used to the high profits generated after the pandemic and do not want to lose them. Companies keep prices at a certain level, preventing the market from freely influencing changes in value. Therefore, a pricing policy is needed that is not based on the desire for super-profits, but on the needs of customers, taking into account their ability to buy decent goods.

3) CONSUMER DEMAND AND QUALITY OF GOODS

Consumer demand is chaotic: over the years a habit of buying has been formed, although wages leave much to be desired. People have become accustomed to high consumption and regular purchases - it has become part of the way of life. If you don't buy anything, you don't “live”. The quality of products has started to deteriorate: in order to maintain high margins, manufacturers save on materials and use cheap raw materials. Buyers are also increasingly focused on the price rather than the quality of goods. As for the volume of freight traffic, the statistics are mixed. Since 2014, according to Russian Railways, transportation volumes have remained virtually unchanged. Despite claims of growth, the real numbers remain at the same level.

“The freight operator of the Russian Railways group increased transportation volumes by 8% in 2014.” (Source)

4) GROWTH IN VOLUMES OF PREFABRICATED CARGOES

Changing buying habits are leading to an increase in the share of consolidated shipments. The average purchase receipt is decreasing, and purchases are becoming more fragmented. Companies are optimizing transportation by combining cargoes into large shipments (20ft, 40ft containers, trucks or whole wagons) to reduce costs. In this regard, we see active development of marketplaces (Ozon, Wildberries, Yandex.Delivery).

5) DIFFICULTIES IN DEMAND FORECASTING

Among the trends is the difficulty of predicting what goods will be in demand in the near future. Economic instability and declining living standards are shifting the demand for necessities: food, clothing and household goods. Against the backdrop of rising real estate and rental prices, people are less and less likely to take out loans and mortgages. To add to the same theme, sometimes there is a need for a certain product in the market, and it is necessary to first establish production and then import it. The waiting time can lead to the fact that at the time of delivery, the goods are no longer relevant. To avoid this, it is theoretically possible to conclude contracts, but this requires either government support or a clear understanding of when the goods will be sold. Sometimes companies start filling warehouses with products, making stocks for the future. Then they face a problem: it is not clear how to sell these products. If they are not in demand, they have to cut prices to get rid of the goods somehow, which leads to losses. As a result, such companies often declare bankruptcy, claiming that they cannot pay their bills and loans.

6) RUSSIA'S RELATIONS WITH OTHER COUNTRIES

Logistics is primarily an economic relationship. There is some good news here. We continue to move away from dollar dependence. Today Russia is actively strengthening relations with India, China and other friendly powers. However, despite the positive dynamics, there are some downsides. For example, Russian-Indian trade faces the problems of excess currency: rupees, not always can be effectively used, and their conversion is associated with losses. There are strong relations with China, but there are also some complications in this case. China is trying to win its position in many cases at the same time, which requires some flexibility from Russia. Parallel imports are being actively developed and workarounds are being implemented to resolve emerging issues. Russia continues to cooperate with Turkey and other friendly countries. Undoubtedly, it is necessary to establish strong supply chains with these countries. But it is important to take into account the factors affecting the possibility of supplying the goods we need.

7) DIGITALIZATION AND ARTIFICIAL INTELLIGENCE

Digitalization is gaining momentum. Aggregator platforms that bring together shippers, consignees and carriers are being created. In the future, such platforms will be expanded and consolidated, which will make it possible to provide a wider range of services. The key task of the industry, in our opinion, is the creation of a unified information base for the distribution of cargo flows across all modes of transportation: rail, road and sea routes. A single base should unite the maximum number of market participants, reflecting the transparency of all processes. Imagine a system where each cargo unit - be it a container or a vehicle - is equipped with a GPS module, and the data is automatically transmitted to a single system. This platform would be able to track current routes, order status and shippers' needs. Such a system is like playing Tetris, where elements (in our case, cargo) are optimally distributed to eliminate unnecessary congestion. A unified digital approach could be a real breakthrough in logistics, providing flexibility and synchronization of work for all. The digitalization of document management is also being actively implemented, and this is certainly an important step forward. However, at the same time, the safety base - paper copies of documents - must be preserved. This is necessary to secure data in case of failures. For example, in case of hacker attacks or technical failures. Otherwise, companies risk serious losses. Digitalization is useful where it helps to speed up and optimize processes. However, you should not blindly rely on artificial intelligence for everything. For example, tasks that require analysis and a non-standard approach are better left to humans. The habit of handing over all the work to the GPT chatbot, banally, threatens the loss of independent thinking. The conclusion is self-evident: digitalization is needed for humans, not the other way around.