Challenges facing UK logistics and supply chain sector outlined by Director of Logistics Institute

Nov. 14, 2012 - PRLog -- Challenges facing UK logistics and supply chain sector outlined in report by Director of Logistics Institute

The state of the UK economy, environmental challenges and a looming skills gap are just some of the challenges facing the UK logistics and supply chain sector according to a monograph authored for the Council of Supply Chain Management Professionals (CSCMP) by Professor David Grant, Director of the Logistics Institute at the Hull University Business School.

The monograph, entitled CSCMP Global Perspectives: United Kingdom, is part of CSCMP’s Global Perspectives Series that now includes monographs on seventeen countries. CSCMP, based in Lombard Illinois, is the preeminent worldwide professional association of supply chain management professionals with over 9,000 members. Professor Grant has been a CSCMP member since 2002 and has just finished a three-year appointment on its Education Strategies Committee.

In his monograph, Professor Grant recognises that once a world manufacturing powerhouse, the UK, despite being the third largest economy in Europe, has since come to rely heavily on its service industries -which includes the £67.5 billion logistics industry - to contribute to its £1,435 billion Gross Domestic Product (GDP).

The logistics sector grew by almost 10% during 2009/10, and currently employs some 2.3 million people in 196,000 companies, but according to Professor Grant, while continued growth in the sector is predicted for the next two years, the main issue is the unknown length of the economic recovery.

While the UK’s domestic logistics and supply chain networks and systems rank amongst the world’s top ten for efficiency and effectiveness, an ageing workforce, less training provided by smaller firms and a lack of appreciation by both government and general population of the importance of the sector are proving to be a challenge.

Despite the renaissance in rail freight activity since 1995, transport by road continues to be the most widely used form of freight movement for goods in the UK. This is more than likely due to the fact that on average, 70% of road freight has its origins and destination in the same region, with only 5% of goods carried more than 300km (186 miles). By the same token, fuel and operating costs continue to rise at a much higher pace than the increase in haulage rates achieved by operators for their services.

Professor Grant said: “With fuel accounting for much of an operator’s transportation costs, there is a real need to look at the spare capacities within logistics networks that could be shared for the common good. Empty running vehicles – those returning to base empty following a delivery – cost companies dearly, and there has to be a way of further developing collaborative distribution.”

Professor Grant concluded: “Such an impactful industry on the UK economy should be viewed upon for making the valuable contribution that it does to society. There is a real need for the public to gain a better understanding of the vital role logistics play in UK business – a role that they themselves ultimately benefit from. Road fright is not just something that ‘has to be tolerated’ by an impatient motorist driving behind a rule-obeying heavy goods vehicle driving at 55mph.

“The logistics and supply chain sector is vibrant, efficient and effective. It just needs to be better understood by the public to support the challenges it needs to address to become ever more efficient and grow.”

For further details of Professor Grant’s full monograph and to obtain a copy, please see the CSCMP’s website at www.cscmp.org

The state of the UK economy, environmental challenges and a looming skills gap are just some of the challenges facing the UK logistics and supply chain sector according to a monograph authored for the Council of Supply Chain Management Professionals (CSCMP) by Professor David Grant, Director of the Logistics Institute at the Hull University Business School.

The monograph, entitled CSCMP Global Perspectives: United Kingdom, is part of CSCMP’s Global Perspectives Series that now includes monographs on seventeen countries. CSCMP, based in Lombard Illinois, is the preeminent worldwide professional association of supply chain management professionals with over 9,000 members. Professor Grant has been a CSCMP member since 2002 and has just finished a three-year appointment on its Education Strategies Committee.

In his monograph, Professor Grant recognises that once a world manufacturing powerhouse, the UK, despite being the third largest economy in Europe, has since come to rely heavily on its service industries -which includes the £67.5 billion logistics industry - to contribute to its £1,435 billion Gross Domestic Product (GDP).

The logistics sector grew by almost 10% during 2009/10, and currently employs some 2.3 million people in 196,000 companies, but according to Professor Grant, while continued growth in the sector is predicted for the next two years, the main issue is the unknown length of the economic recovery.

While the UK’s domestic logistics and supply chain networks and systems rank amongst the world’s top ten for efficiency and effectiveness, an ageing workforce, less training provided by smaller firms and a lack of appreciation by both government and general population of the importance of the sector are proving to be a challenge.

Despite the renaissance in rail freight activity since 1995, transport by road continues to be the most widely used form of freight movement for goods in the UK. This is more than likely due to the fact that on average, 70% of road freight has its origins and destination in the same region, with only 5% of goods carried more than 300km (186 miles). By the same token, fuel and operating costs continue to rise at a much higher pace than the increase in haulage rates achieved by operators for their services.

Professor Grant said: “With fuel accounting for much of an operator’s transportation costs, there is a real need to look at the spare capacities within logistics networks that could be shared for the common good. Empty running vehicles – those returning to base empty following a delivery – cost companies dearly, and there has to be a way of further developing collaborative distribution.”

Professor Grant concluded: “Such an impactful industry on the UK economy should be viewed upon for making the valuable contribution that it does to society. There is a real need for the public to gain a better understanding of the vital role logistics play in UK business – a role that they themselves ultimately benefit from. Road fright is not just something that ‘has to be tolerated’ by an impatient motorist driving behind a rule-obeying heavy goods vehicle driving at 55mph.

“The logistics and supply chain sector is vibrant, efficient and effective. It just needs to be better understood by the public to support the challenges it needs to address to become ever more efficient and grow.”

For further details of Professor Grant’s full monograph and to obtain a copy, please see the CSCMP’s website at www.cscmp.org