We have quite possibly reached a capacity crisis unheard of in the European logistics industry. A shortage of spare trailer space is real and is now causing harm to businesses across the UK.
A few months ago we wrote about the brewing storm UK businesses are exposed to, read it here http://www.jordonfreight.com/2017/07/21/perfect-storm-brewing-uk-companies-importing-goods-europe/
But this was before the Rastatt incident which obliterated the already creaking capacity as cargo spilled off rail into the open road market. This compounded the multitude of issues we have seen recently which include industrial action in France as well as an unwelcome return to migrant activity in Calais.
Overall it’s an industry under pressure with consequences for businesses far reaching.
So what can a business do right now? Well we need to break it down into two phases. Short term and long term, as in our opinion businesses need to be prepared for these situations in the future.
Unfortunately right now money talks. If you have a very good broker they should have the ability to source the best available fit for the best available price. Those that are used to working on-demand will have relationships with a multitude of carriers and an overview of the market which is helpful to keep costs at best palatable.
If you use a larger forwarder or you use an asset based carrier then it’s more likely you will be exposed to some of the higher prices on the market simply due to the fixed way they operate.
It will really boil down to deciding to pay more, possibly a lot more, or wait in the hope that things will return to normal sometime soon. We are closely monitoring what ‘normal’ will look like post-crisis…
Weighing up the importance of the delivery of your cargo versus the extra cost you may pay to achieve this is vital. There are opportunists at large so if in doubt feel free to call us to benchmark prices and availability. Keep in mind that not all routes have become super costly. Traffic is still moving.
We believe habits will need to change moving into the next few years. Uncomfortable news we know but our article above should explain why we think this. Businesses should run a risk assessment and consider contingencies. Does your supplier fit the more dynamic or urgent aspects of your business. Have you been well informed? Have you been kept first in line? Do you need to hold more stock? Etc.
Ultimately you should ask questions of your supplier to determine what steps can be taken to avoid or minimize this sort of disruption in the event it happens again. Future changes on both sides may be required.
It’s fair to say this situation is highly unusual but as per our thoughts for the future there could be frequent disruptions ahead until a shift somewhere happens. With increasing prices could we see the rise of the UK haulier abroad again?
So in conclusion and ending on a positive note, it will get better. Nothing stays the same. Just make sure you’re being informed by someone knowledgeable and trusting so when the clouds clear you’re first in line.
All the best The Jordon Team