22 December 2020
Logistics industry trends
No one in the logistics sector is likely to forget 2020
anytime soon. On the cusp of a new year that all are hoping will bring less
upheaval, it’s time to look ahead to 2021 and what could be in store for the UK
logistics industry over the next twelve months.
New logistics hubs nationwide
With millions unable to reach the shops for much of the
year, 2020 has seen the prevalence of online shopping reach new heights. Despite
difficult and unprecedented circumstances, couriers and delivery companies responded rapidly to huge surges in demand within some sectors, and an
almost overnight drying up in others.
After months of extended delivery hours
and contact-free doorstep drops, consumers seem to have developed a lasting
preference for almost round-the-clock delivery.
This consumer shift is likely to result in a flurry of new
logistics hubs, close to cities and urban centres.
While the UK’s existing hubs
tend to be located next to motorways and on city boundaries, it’s doubtful that
these will provide the proximity and flexibility necessary to meet surging last mile delivery
and reverse logistics needs. Commercial land for new warehouse space could well
become even more sought after in premium locations, following in the footsteps
of the enormous logistics centre currently being built near Swindon, set to become the UK’s largest
at 2.3 million square feet.
Alongside the need to deliver more frequently, logistics
operators are also being compelled to do so more sustainably. Fuelled by the
national pledge to achieve carbon neutrality by 2050, this emphasis has been
growing steadily over recent years and only seems likely to intensify in 2021. Recently the government announced that the ban on combustion engines
start from 2035, rather than 2040 as originally planned.
There are also new ultra-low
emission zones (ULEZ) planned for Bath
and Birmingham in early 2021 – similar to the nation’s first launched in
London this year - as well as more across major cities in Scotland. While daily
charges for vehicles under 3.5 tonnes (that don’t meet ULEZ emission standards)
seem moderate at £12.50, it won’t take long for this to become a serious drain
on resources for couriers who regularly enter these areas. For large vans and
HGVs over this weight, the daily charge jumps to £100 a day. What’s more,
London’s ULEZ is due
to be extended to create a single larger zone bounded by the North Circular
Road (A406) and South Circular Road (A205) in October 2021.
Under mounting pressure, logistics operators will need to
continue to explore new operational approaches, such as alternative fuels
and/or electric fleets, as well as minimising empty miles and optimising
sustainable driving practices.
At the time of writing, UK hauliers looking to enter France
have been halted at
the Dover border, while the government works to lift the temporary travel
ban imposed by EU nations in response to the new COVID-19 variant. And all
while the end of Brexit transition period is just days away, and we are still unaware
of whether a deal will be agreed.
This set of circumstances seem to have converged to create a
‘perfect storm’ just before Christmas, as UK-bound deliveries stay on the other
side of the Channel to avoid the return queues, many retailers see goods
delayed and consumers face going without last minute orders made after the ramping
up of festive lockdown restrictions.
It’s a stark reminder that while Brexit may have been somewhat
overshadowed by COVID this year, the UK’s exit from the European Union (EU)
will be firmly back on the agenda in 2021.
While a potential deal is still being decided, it’s difficult
to predict how exactly Brexit will impact the logistics sector, but it’s clear
that there’s still much to adapt to and further supply chain interruptions are
more than possible.
Any logistics operation that trades with Europe should do
all it can to be as prepared as possible for a No Deal Brexit, taking action on
measures including Economic Operators
Registration for exporters, the extra customs declarations that may be
necessary, paying duties in full and changes to VAT arrangements.
No Deal would mean trade between the UK and EU takes place
under World Trade Organization(WTO) rules which, in the most general sense, are likely to take longer and
cost more, although exporters will be able to charge zero per cent VAT for EU
customers, as they can now with those from the rest of the world.
There is useful industry-focused Brexit
advice and guidance on Logistics UK.
Rely on EPOD and logistics optimisation in 2021
Facing the future becomes more certain with the right
digital support. Today’s Electronic Proof of Delivery (EPOD) systems go beyond
simply providing POD, providing a digital infrastructure across all areas of
logistics operation, from route optimisation and job scheduling, to fleet
maintenance and compliance management.
To find out more about Touchstar’s EPOD solutions
and how they can help your business succeed in 2021 and beyond, please get in touch with us.