Home » GPS Tracking Blog & Software News » OnTrack Newsletter Vol:22 – Business Corner: A Growth Opportunity - Container Tracking
March 14, 2012

OnTrack Newsletter Vol:22 – Business Corner: A Growth Opportunity - Container Tracking

THE BUSINESS CORNER

Container Explainer

Container Tracking with GPS

This month I’m going to use the Business Corner to look at a growth opportunity in the GPS tracking and location-based services sector that some of you might be interested in exploring further: Container Tracking.

Why might you be interested in container tracking? Intermodal containers – with their standardized form factor enabling efficient transport via ship, rail, and road – account for 90% of non-bulk cargo moved via container. That kind of volume takes a lot of containers – in fact, over 18 million containers make more than 200 million trips annually. In a lot of ways, container shipping is the industry on which the whole world moves.

To truly understand the importance of those facts you need to understand how intermodal container shipping generally works. A container – 20-foot, 40-foot, or some other standard size – is packed and sealed at a factory. Depending on its destination in relation to its source, the container is then loaded onto either a truck or rail car for transport. If the container is being shipped from China, say, to the United States, it will be moved to a port, unloaded from its transport, and loaded into a container ship for a trip across the ocean. The process is then repeated in reverse upon reaching the United States until the container finally arrives at its ultimate destination.

Signed, Sealed, Delivered – I’m Yours

Now, think about the ramifications of that process to you as an entrepreneur in the location-based services business. A tracking device placed under the hood of a truck or some other chassis-mounted location simply will not work for tracking a container any further than one particular segment of its total trip. To truly track the container, the tracking device needs to be in the container itself – allowing for tracking and reporting the location and other data about a container from the factory all the way to its final destination.

With so many containers floating around out there (literally!), one might expect this sector to be already saturated with vendors providing GPS tracking and other location-based services. However, tracking device technology is just now catching up to this type of application. Because containers are stacked in ports and on ships, poor line-of-sight and other issues slowed implementation of tracking devices in the containers. Now, however, the latest generation of devices and hybrid solutions is opening the door to this market.

In fact, two different reports are now forecasting explosive growth in the container tracking market. A Berg Insight report (http://www.berginsight.com/ReportPDF/ProductSheet/bi-container-ps.pdf) points out the current base of container-installed tracking devices is 77,000 units, with forecasted growth to a million installed units by 2016. Read that again: Out of 20 million containers, only 77,000 currently have tracking devices installed. Doing the math should make any budding entrepreneur sit up and take notice. In the next four years, tracking device installations in intermodal containers are forecast to grow 1200%. Wow.

If that’s not enough for you, consider another report by ABI Research recently discussed on GPS World (http://www.gpsworld.com/transportation/fleet-tracking/news/competitive-container-shipping-market-boost-tracking-revenues-690). In that report, ABI Research forecasts that container security and tracking revenues are expected to grow 225% between now and 2016, from $212 million to $690 million annually – a compounded annual growth rate of 27%. Again, wow.

I hope this piques the interest of some budding entrepreneurs out there, and I hope it helps my partners out there grow their existing businesses. The intermodal container tracking market might not be for you – but then again, it just might be. And with numbers like these, exploring this lucrative growth market for yourself just plain makes sense.