Transporting people and goods has become one of the biggest and most complex businesses in the world. It also has become a proving ground for the most powerful business trends of the past 20 years – including deregulation, privatization, and global consolidation. As their investors grow more restive and their customers push to better integrate global supply chains, the world’s transport and delivery companies are coming under increasing pressure to perform. In addition, the economic future of the entire industry is complicated by issues of national pride and homeland security.

Each segment of the industry – including air, truck and rail operators, post and parcel express services, logistics and shipping companies, travel and tour providers, airports, ports, and urban transit authorities – faces particular challenges. But a few business imperatives – e.g. achieving scale, defining the scope of the business, and managing increasingly complex networks and partnerships – will likely determine success across the industry.

The special demands on logistics faced by the biggest sectors of the industry – airlines, railroads, and post and parcel services – are forcing them to develop more innovative service offerings and a more disciplined approach to operations. Some companies in these and other sectors are radically redefining the business model. In the last 10 years, for instance, some companies have moved into the fast-growing, $100 billion business of third-party logistics, providing warehousing, distribution, transportation and other supply-chain services to shippers in a variety of industries.

"Transport and logistics companies are unlike most of the businesses they serve," says Staffan Hertzell, senior practice manager of Travel Infrastructure Logistics, based in the Amsterdam office. "They cannot produce inventory; they have to excel at managing pricing, capacity, and network economics. Service providers must be able to sell essentially the same product – an airline seat or shipping slot – to different customers at different price points, depending on the market and the needs of each customer. Operational excellence is key, but so is pricing and service differentiation."