Supply chains updates
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Disruption from the UK’s truck driver shortage is expected to deepen with more goods failing to reach shelves on the high street, the head of Britain’s largest logistics outsourcer has warned.
James Wroath, chief executive of Wincanton, said the extra strains were likely to hit the haulage industry as demand picks up ahead of the start of the Christmas shopping season on Black Friday at the end of November.
“The number of drivers will take time to increase. That’s not going to change anytime soon. At the moment, we’re in the calm before the storm,” he said. “The concern will be once the Black Friday and Christmas peaks come along.”
The company, which traces its roots back to milk delivery and works with household names including Argos, Heineken and Unilever, has vacancies for about 600 drivers, or 12 per cent of the near 5,000 it employs.
A combination of Brexit, the pandemic, tax reforms and driving test backlogs has left the UK short of an estimated 100,000 hauliers to carry goods to the country’s warehouses and retailers.
As a result, shortages of items from beer and milkshakes to building materials and furniture have emerged, while retailers have started to narrow the range of products they sell.
While noting that demand was difficult to predict this year, Wroath added that businesses most willing to pay more to secure haulage subcontractors would be least affected by the shortages.
“It will depend on what our customers are prepared to pay as the resources are squeezed. Supermarkets will be willing to pay more than most for subcontracting haulage,” he said.
Wincanton has benefited from a 20 per cent surge in revenues in its current financial year, driven by strong ecommerce demand, it said in a trading update. It made £1.2bn of revenues in the year to March.
However, the Chippenham-based group is negotiating with customers to pass on extra costs to hire and retain drivers.
Wroath said consumers had been conditioned to think logistics services were free because of cheap next-day delivery offered by the likes of Amazon and grocery deliveries that only cost about £5.
His company also acts as the link between hauliers and retailers when it does not have enough of its own drivers to handle the work.
He added that a temporary relaxation in rules around foreign drivers would help with the Christmas rush, although he said the government was unlikely to ease them.
Wincanton also said in its trading update that it had acquired Cygnia Logistics, which works with BrewDog, Moonpig and Molton Brown, for £23.9m.