Published on: June 9, 2025 / Updated on: June 11, 2025 – Author: Konrad Wolfenstein
Doubling NATO support capabilities through the private sector and dual-use logistics in logistics, supply and transport – Image: Xpert.Digital
From demand to reality: Sustainable scaling of NATO support systems
Logistics Transformation: How civilian capacities can achieve military objectives
NATO Secretary General Mark Rutte's drastic demand for a doubling of support capabilities in logistics, resupply, transport, and medical assistance presents the alliance with unprecedented challenges. This analysis examines how the private sector and dual-use logistics can contribute to achieving these ambitious goals in both the short and long term, while ensuring scalability and sustainability.
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Current situation and challenges
NATO faces the complex task of significantly expanding its logistical capacities while simultaneously improving efficiency and responsiveness. Germany plays a special role as a "logistical hub" through which NATO troops and their supplies must be moved to reach their operational areas. This position requires not only national efforts but also close coordination with civilian actors.
The German Armed Forces' logistics must be able to rely completely on its civilian-commercial back-up, with support that is guaranteed, reliable, and integrated into the Bundeswehr's logistical processes. This dependence on civilian partners underscores the need for a strategic realignment of military logistics. Private military companies (PMCs) already offer comprehensive logistics solutions, including transport management, supply chain management, and distribution services, to ensure smooth and efficient operations both domestically and abroad.
Role of the private sector in military logistics
Outsourcing trends and capacity expansion
The privatization of military logistics has become a dominant trend in recent decades. The U.S. military and other Western armed forces have already implemented extensive outsourcing programs, with the Army Materiel Command's (AMC) civilian support structure comprising approximately 37,700 military, civilian, and contract personnel operating across all 50 U.S. states and more than 150 countries. This development demonstrates the enormous potential of private actors to expand capabilities.
Private military service providers have proven indispensable for modern military operations, providing specialized capabilities and technologies that the military itself may not possess. Outsourcing logistics functions allows armed forces to focus on their core competencies while simultaneously increasing efficiency through specialized civilian providers. This division of labor is particularly relevant for the targeted doubling of capabilities, as it enables rapid scaling without a corresponding expansion of the military personnel structure.
Specialized logistics service providers
Companies like Crane Worldwide Logistics already offer comprehensive solutions for government and defense, specifically tailored to the complex requirements of the military. These service providers possess the necessary certifications and technical expertise to operate even in challenging environments. Their global networks and established supply chains can act as a multiplier for military capabilities.
DB Schenker, for example, offers dedicated supply chain solutions for the specific requirements of the aerospace and defense industries, with experts available around the clock and worldwide. These integrated end-to-end solutions are designed to optimize every step of the supply chain, from procurement to distribution. The combination of industry expertise and global reach makes these companies ideal partners for the desired capacity expansion.
Dual-use goods and technologies as a key factor
Definition and strategic importance
Dual-use goods are products and technologies that can be used for both civilian and military purposes. These goods encompass a wide range of items, from advanced materials and machinery to software and technology, which can be applied in a variety of industries. Due to their potential military use, dual-use goods are subject to strict export controls and regulations.
The strategic importance of dual-use technologies for NATO lies in their ability to serve both commercial and military applications. This duality makes it possible to leverage civilian innovations and production capacities for military purposes, which is particularly crucial given the targeted doubling of capabilities. However, NATO and dual-use regulations require end-to-end supply chain traceability, restrictions on technology exports, and data security requirements.
Regulatory challenges and compliance
The implementation of export controls and regulations is a crucial aspect of logistics, as it ensures that dual-use goods are delivered only to authorized recipients and are not used for unauthorized purposes. A key challenge is the need for continuous updates to regulations and lists for dual-use goods to reflect emerging technologies and threats. This regulatory complexity necessitates specialized compliance systems and can be supported by Product Lifecycle Management (PLM), which ensures complete supply chain traceability and compliance at every stage of the product lifecycle.
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Short-term solutions for capacity expansion
Activation of existing civilian capacities
The short-term doubling of support capabilities can be achieved through the systematic activation and integration of existing civilian logistics capacities. Germany already possesses a high-performing civilian transport sector that can be utilized within the framework of Host Nation Support (HNS) to support NATO operations. The challenge lies in the effective coordination and integration of these capacities into military planning and command processes.
Modern transport companies already use data transmission via tablets and mobile phones, as well as GPS-based navigation, to manage their vehicles. This existing infrastructure can be expanded by integrating military information systems to enable seamless communication between civilian and military actors. The ability to allow civilian commercial transport vehicles to "join" military-led convoys provides military command, guarding, security, and reporting capabilities.
Outsourcing strategies and contract models
The experience of the US military shows that outsourcing logistics functions can enable significant capacity expansions. The Department of Defense is increasingly relying on the expertise of private companies to handle complex logistical tasks and increase operational efficiency. Both the military and private manufacturers outsource services with the same primary goal: cost reduction while simultaneously expanding capacity.
Framework agreements, such as those already awarded by the Federal Office of Bundeswehr Equipment, Information Technology and In-Service Support (BA-AINBw) for the operation of rest and assembly areas, can serve as a model for broader implementation. These contract structures enable the rapid activation of additional capacities without lengthy procurement processes.
Flexibility through modular approaches
Modern logistics systems like “Livepick” from TGW Logistics demonstrate how modular approaches can enable rapid scaling. This highly modular system consists of a source and a destination area, which operate independently and are each subdivided into individual modules. All modules can be easily expanded – according to individual needs and without interrupting ongoing operations. From contract signing to go-live, it takes only six to twelve months.
Long-term strategic planning and sustainable development
Public-private partnerships as a cornerstone
The long-term sustainability of capacity expansion requires structured public-private partnerships (PPPs) that extend beyond short-term contractual relationships. International experience shows that PPPs work particularly well for investments in and the operational management of logistics platforms. PPPs refer to agreements between the public and private sectors in which services that would otherwise fall under the responsibility of the public sector are provided by the private sector.
Successful PPP models from Asia offer valuable insights for NATO implementation. In Vietnam, for example, there is a specific institutional framework for PPPs with dedicated PPP units at two levels: a steering committee at the national level and a PPP board in ministries or provinces to facilitate the development and implementation of specific PPP projects. Thailand pursues a cost-optimized approach, whereby the dry port operator should be the one offering the lowest overall costs for the country's exporters and importers, while simultaneously meeting a certain minimum level of service.
Technology integration and digitization
The integration of advanced technologies is crucial for the long-term efficiency and scalability of logistical support capabilities. The U.S. Defense Logistics Agency (DLA) already manages the end-to-end defense supply chain—from raw materials to end-user deployment—for the five branches of the military, 11 combat commands, other federal, state, and local agencies, as well as partner and allied nations. This comprehensive coordination requires sophisticated digital systems and data integration.
The assessment of transport sector capacities and their operational utilization should be supported by integration into Enterprise Resource Planning (ERP) systems. BWI GmbH should examine whether the inclusion of civilian commercial capacities in the ERP system is possible, even though this requires extensive testing. This integration would enable seamless planning and coordination between military and civilian logistics capacities.
Building redundant and resilient structures
Long-term planning must also consider the development of redundant and resilient logistics structures that can withstand geopolitical shifts and security challenges. Experience with COVID-19 has shown that even the most secure supply chains can have vulnerabilities. Supply chain managers must address increasing complexity and develop strategies to scale quickly up or down in response to rising demand.
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Scalability and crisis resilience
Adaptive Capacity Models
The ability to scale rapidly is crucial for managing unforeseen crises or military escalations. Modern logistics providers have already proven their flexibility in responding to changing demands. An experienced logistics provider can quickly adapt to market shifts and manage seasonal fluctuations, which is particularly beneficial for organizations that frequently face unpredictable demand.
Implementing Vendor Managed Inventory (VMI) systems can help improve supply chain flexibility and responsiveness. By consolidating suppliers and verifying their speed and reliability, organizations can optimize their supply chains while increasing scalability. Real-time data on production and shipment transparency enables proactive responses to gaps or potential disruptions in the supply chain.
Risk management and business continuity planning
Ensuring the continuity of logistical support, even under extreme conditions, requires comprehensive risk management strategies. Proactive Management Conferences (PMCs) help mitigate logistical risks through proactive planning, effective management, and contingency strategies. This risk assessment is particularly important in unstable security situations, where the likelihood of negative consequences increases.
Examples from Iraq show that the risk of logistics providers refusing to provide services increases with growing instability. Since refusing to provide services leads to a decrease in effectiveness, logistics in unstable regions must be provided by the armed forces themselves. Logistics can be outsourced to areas with stable security, such as the home country or en route to the area of operations.
International coordination and standardization
The scalability of NATO logistics requires increased international coordination and standardization of procedures and systems. The experiences of various NATO member states with the privatization of military logistics services reveal both potential benefits and challenges. The reorganization of NATO member states' military logistics systems included strengthening and modernization efforts to counter new threats that emerged after the Cold War.
While many NATO members, particularly the Turkish Armed Forces, continue to work with the private sector to strengthen their country's defense industry, the idea of sourcing services from external sources has gained traction in recent years due to changes in public procurement legislation. These developments highlight the potential for a coordinated NATO-wide strategy to integrate private logistics capabilities.
Dual-use technologies as a key to resilient NATO defense structures
Doubling NATO's support capabilities in logistics, resupply, and transport is an ambitious goal that can only be achieved through a strategic combination of private sector expertise and military planning. The analysis shows that both short-term and long-term solutions are available that enable sustainable and scalable capacity expansion.
In the short term, existing civilian logistics capacities should be systematically activated and integrated through structured outsourcing programs. The implementation of modular systems and flexible contract models can enable a rapid response to changing requirements. In the long term, the sustainable development of support capabilities requires the establishment of strategic public-private partnerships, the digitization and integration of supply chains, and the development of resilient and redundant structures.
The special role of dual-use goods and technologies offers considerable potential for synergies between civilian and military logistics, but simultaneously requires careful compliance strategies and regulatory attention. The successful implementation of this strategy will be crucial for NATO to strengthen its defense capabilities in line with current security policy challenges.
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Dual-use logistics experts - Image: Xpert.Digital
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Hub for Security and Defense - Advice and Information
Hub for Security and Defense - Image: Xpert.Digital
The Security and Defence Hub offers expert advice and up-to-date information to effectively support companies and organizations in strengthening their role in European security and defence policy. Working closely with the SME Connect Defence Working Group, it particularly promotes small and medium-sized enterprises (SMEs) that wish to further develop their innovative capacity and competitiveness in the defence sector. As a central point of contact, the Hub thus creates a crucial bridge between SMEs and European defence strategy.
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