Logistics sector faces ‘perfect storm’ of challenges

By James Ridler contact

- Last updated on GMT

Walkington: 'Clearly Brexit is challenging enough, but the warehousing and logistics sector is being hit from all sides'
Walkington: 'Clearly Brexit is challenging enough, but the warehousing and logistics sector is being hit from all sides'

Related tags: Brexit, Supply chain

The warehousing and logistics sector could soon face a ‘perfect storm’ of challenges in the next few months irrespective of Brexit, according to Schoeller Allibert UK.

Undersupply of warehousing property and lack of domestic manufacturing capacity in the returnable transit packaging industry would leave supply chain operators unable to cope with the accelerated adoption of e-commerce, the company claimed.

Jon Walkington, Schoeller Allibert UK retail and systems integrator sales director, warned the pandemic’s long-term impact and the shift to online shopping had already created significant pressure on the industry to meet demand efficiently.

Public health crisis

“On top of this, while the warehousing market was already buoyant before the public health crisis hit the UK, an undersupply of warehousing property in the Midlands and The South has seen demand outstrip supply, resulting in capacity expansion challenges and cost pressures,”​ Walkington continued.

“Established leading online retailers, supermarket chains and third party logistics operators, alongside the NHS, are all seeking to rapidly increase their distribution capabilities to respond to the UK’s challenges.”

Returnable packaging was also another area highlighted by Walkington as critically under capacity from a UK manufacturing perspective.

‘Invest won’t meet demand’

“Even with significant investment in 2021, this is unlikely to come on stream before 2022, creating further pressure for systems integrators and supply chain operators to meet demand,”​ he added. “All of this is essentially creating a perfect storm for the industry!”

“Clearly Brexit is challenging enough, but the warehousing and logistics sector is being hit from all sides.”

Meanwhile, trade organisation Logistics UK has urged the government to review traffic and welfare management for HGV drivers​ following border chaos over Christmas.

Logistics UK (formerly the Freight Transport Association) says many drivers were left without basic hygiene and food provision facilities. It has written to transport minister Lord Agnew pointing out what it sees as shortcomings in the Government's plans in the event of border disruption.

Related topics: Supply Chain, Brexit

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