Transport & storage companies experience fewer challenges this month, but retailers struggle
Posted by: electime 27th August 2024
Today’s ONS Business Insights report reveals transport & storage sector companies – including couriers, home delivery and logistics firms – faced fewer challenges than any other industry sector in the first weeks of August. 52.3 per cent reported no challenges compared to just 19.4 per cent of retailers, says the home delivery expert Parcelhero
Transport & storage sector companies, a category that includes logistics, couriers and home delivery firms, have reported fewer challenges to their business than any other industry sector in the first half of this month.
Today’s Office for National Statistics (ONS) Business Insights report reveals that, for the period 5-18 August, a considerable 52.3 per cent of transport & storage sector companies reported they were not currently experiencing any challenges. That’s higher than any other industry sector, with just 19.4 per cent of retailers and 26.5 per cent of manufacturers reporting no issues, says the home delivery expert Parcelhero.
Parcelhero’s Head of Consumer Research, David Jinks M.I.L.T., says: ‘It’s been a rocky road for transport & storage sector companies over the last few years, as they deal with the fallout from Brexit and global supply chain upheavals. Happily, it looks as if this month, the industry is enjoying a period of relative calm; far more so, in fact, than their retail partners.
‘A sizable 52.3 per cent of transport & storage sector companies – a category that includes logistics, freight, mail, couriers, distribution and warehousing firms – reported no particular challenges in the first half of this month. That’s notably calmer than last summer, when only 44.4 per cent of transport sector companies reported no challenges.
‘This month, competition from rival companies topped the list of challenges for those transport & storage companies who did report problems. 21.4 per cent named competitors as their main challenge. It’s true that competition for logistics contracts is fierce, with a number of high profile manufacturers and retailers switching to rival third party logistics (3PL) companies, particularly in automotive and retail. There has also been considerable upheaval in the courier industry, with a number of big names changing ownership and refocusing.
‘Next came economic uncertainty, a concern for 17.3 per cent of transport & storage companies, followed by financial costs, a worry for 15.6 per cent of firms.
‘In contrast to their logistics and delivery partners, retailers had a far more turbulent start to August. Only 19.4 per cent of retailers reported experiencing no challenges, with a huge 31.9 per cent of wholesale & retail sector companies reporting economic uncertainty was the biggest challenge they face. It’s been a patchy summer so far for the High Street and that is reflected in these findings.
‘A total of 29.7 per cent of retailers named competition as their second biggest challenge, as summer discounts started early this year. Among other concerns, 23 per cent named insufficient domestic demand for their products as an issue, and a sizable 10.5 per cent were worried about weather conditions – a higher result than even the construction sector. Certainly the damp summer won’t be helping to encourage footfall.
‘In manufacturing, insufficient domestic demand was the biggest headache for companies. 27 per cent of companies expressing concern, followed by competition from rival companies at 22.7 per cent.
‘August so far seems to have thrown fewer challenges at transport & storage companies than other industries. However, the sector does not operate in a vacuum. Issues impacting retailers and manufacturers will bite their transport partners further down the line, as struggling companies strive to lower their costs. However, for now, many companies will doubtless embrace the calm.
‘One certainty is that it will be those retailers with strong in-store and online sales that will ultimately triumph in a post-Covid world, supported by their transport & storage partners. Parcelhero’s influential report “2030: Death of the High Street” has been discussed in Parliament. It reveals that retailers must develop an omnichannel approach, embracing both online and physical store sales. Read the full report at: https://www.parcelhero.com/content/downloads/pdfs/high-street/deathofthehighstreetreport.pdf
