With the global pandemic triggering multiple international lockdowns, it was hardly surprising that consumer reliance on online purchasing grew. The rise in internet sales created significant growth in the UK logistics sector as it expanded to accommodate demand. According to the Office for National Statistics, internet shopping in November 2020 accounted for 36% of total retail sales (up from 21.6% in November 2019) representing a massive y-o-y increase of 66.7%.
Talking to clients in the logistics sector, we are seeing several trends emerge as they look to drive continued efficiencies established at the height of the crisis. These include:
- Focus on the last mile: Resolving last mile inefficiencies is a key focus for most clients in 2021 (particularly given that the last mile now accounts for c.50% of the supply chain spend due to the increase in home deliveries).
- Warehouses: Traditional locations for logistics hubs next to motorways and on the outskirts of cities are no longer enough to cover the challenges for last mile deliveries and reverse logistics. Because of this, a significant number of clients are focused on building more warehouses close to city centres to meet this increase in demand, sustainably.
- Sustainability: The move towards net-zero carbon continues to be a big focus of all our logistics clients and is central to the future of logistics, both from a warehousing and operations perspective. This includes integrating renewable and low-carbon technologies into warehouses, and fitting purification technology to reduce emissions or upgrading transport fleets to fully electric where possible.
- Internet of Things (IoT): The adoption of IoT is helping clients drive value within the supply chain by connecting it all together, from people to parcels. The data provided by IoT devices is enabling them to track shipments in real-time as well as increasing efficiency around maintenance and automation. The same technology is also allowing their customers to track their parcel in real-time and reduce theft. As technology and trends move on, our clients continue to be focussed on driving innovation to deliver change and create new solutions.
- Automation & AI: With COVID-19 driving a socially distanced world in 2020, a significant proportion of our clients are looking to increase their investment and reliance on warehouse automation through pick and place technologies to increases efficiency, speed, and productivity, whilst at the same time reducing human interactions. This also extends to AI for route planning and prediction, as well as warehouse management through the prediction of rotation of supplies.
With lots of lessons learnt from 2020 our clients say they are focussed on becoming more flexible so better able to cope with variations in demand caused by seasonal and unexpected events. Typically, this is through the use of a combination of transportation management systems and AI which can act as an early warning system to help forecast risks, costs, and demand ensuring the "on-demand" delivery consumers now expect. Many anticipate Brexit will continue to have a significant impact on the logistics sector through an increase in supply chain costs and delays. This is another reason why investment in innovation and flexible technology will need to be embraced to manage the challenges that will arise over the coming months.
Considering this, we are partnering with our clients across the full breadth of the sector to find solutions to these challenges through:
- Future proof the business: we achieve this by deploying our Leadership Consulting Practice. They help clients understand the capability of their teams through the creation of success profiles (what good looks like), the assessment of individuals against these, and the creation of individual development plans to help raise the calibre of individuals, teams and the business as a whole.
- Gaps in capability: we achieve this by deploying our Research & Insight Practice. They help clients understand the talent landscape giving them the evidence they need to make informed people decisions as well as to build evidence-based business cases to win budget allocation for growth.
- Change and transformation: Our Interim Management Practice provides clients with experienced high-impact Interims and Independent Consultants to help build and deliver change strategies.
- Strategy development: we achieve this by deploying our Research & Insight Practice. They help clients understand how other companies are structured and how they have achieved success. This Busines Intelligence is then used to support and evidence the creation of business strategies to tackle the challenges ahead.
If you would like to confidentially discuss how Norman Broadbent Group could help you overcome your business or people challenges, please contact Nick Behan on +44 (0) 0207 484 0106 or via
nick.behan@normanbroadbent.com