The supply chain community needs the support of a Government that not only understands the problems that it faces but, more importantly, is prepared to take appropriate steps to help solve them, says Peter Ward, CEO of UKWA
The need to achieve an efficient and sustainable logistics network for products and services is arguably among the greatest challenges facing the UK today.
However, while I am in no doubt that the industry which UKWA represents is more than capable of meeting this challenge, it is clear that the supply chain community needs the support of a Government that not only understands the problems that it faces but, more importantly, is prepared to take appropriate steps to help solve them.
And with British society in the midst of a period of rapid and wideranging change, many of the decisions taken at Westminster during 2016 are likely to have a clear and lasting impact on the UK’s future logistics and transportation landscapes.
For example, last year the Office for National Statistics forecast that the number of people living in the UK will rise from 64.6 million in mid- 2014 to 74.3 million by 2039. That’s an increase of almost 10 million in 25 years.
Apart from the inevitable strain that this population explosion will put on our already creaking essential services such as schools and hospitals, it is probably safe to assume that, as these new residents will need to be fed and clothed, supply chains will come under intense pressure to ensure that the shelves of the nation’s high street shops remain well stocked.
This means that the Government simply has to act to ensure that our road and rail infrastructure can sustain the physical movement of goods at the kind of levels that will be required.
The fact that the £15bn road investment strategy is continuing and that major upgrades to several key routes are in the pipeline is encouraging, but many observers contend that we are still paying the price for decades of under spending on our highways and that even the substantial sums now being allocated to road improvements are unlikely to bring about any significant tangible reduction in congestion.
If such concerns about the road network prove prophetic, the calls to switch more freight to rail will grow louder. But will our railways be fit to help? Some industry watchers think not.
The rail freight sector remains worried that rather than freeing up capacity on the railways, HS2 – the construction of which is set to begin in 2017 – will, in fact, lead to a ‘capacity crunch’ on parts of the system that will cause major disruptions to freight traffic.
The Government contends that this is not the case but has so far failed to deliver an all-together convincing counter argument, so the UK logistics industry will be looking on with interest when the National Infrastructure Commission, chaired by Lord Adonis, publishes its report on the UK’s most critical infrastructure challenges before the next budget.
Of course, the UK’s growing population will also need to be housed and this year will see the Government begin to introduce measures designed to deliver 400,000 affordable new homes by 2020/21 – including 13,000 directly commissioned on public land.
So that’s another 400,000 addresses for the online fulfillment sector to deliver to. The home-delivery model is already fraught with challenges – not the least of which are traffic congestion in urban areas and other practical issues such as a lack of parking space.
Furthermore, with a lack of suitable warehousing space already an issue for the logistics industry, it is hard to see how home deliveries and, indeed, the more frequent daily drop-offs required to replenish the growing number of town- and city-centre grocery retail stores that are opening as a result of current consumer shopping patterns, can be sustained.
We live in a market economy that dictates that land for house building will be more valuable than industrial property space, but surely the time is fast approaching for some kind of Government intervention to set aside part of the public land given up for new housing schemes for use as storage space – to allow warehouses and distribution centres to be built where they will be able to serve our rapidly expanding communities
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