Warehousing and fulfilment top 2024 priorities for UK retailers
Warehousing now cited as the top focus for the UK’s retail businesses in the coming year
Increasingly expensive and scarce warehousing, alongside meeting the country’s huge e-commerce sector cost-effectively, has pushed fulfilment and industrial space to the top of UK retailers’ minds.
According to surveys by Advanced Supply Chain (ASC) and Sapio Research of 100 UK retail decision-makers, warehousing is now a focus for 57%, which is up from 50% in 2022, and places it as the top issue.
Additionally, the closely aligned area of fulfilment rose from being cited by 35% of those surveyed last year, to 50% in 2023, underlining how critical the latter stages of supply chains are for retailers.
Part of this focus is the huge growth in e-commerce, with the UK sitting as one of the world’s most developed online shopping markets, but also the increasing price of securing warehousing alongside the difficulty in handling goods and returns in a cost-efficient manner.
The latter have proven to be especially troublesome for retailers, with the costs of handling returns high, and too few goods being put back into stock for resale in good condition.
With these factors in mind, firms are looking at ways to reduce unnecessary costs in their supply chains by outsourcing logistics, relying on data and reducing vehicle mileage.
For the latter, ASC’s research found that 35% of retailers are seeking to lower operating costs via removing miles.
While reducing mileage can be done through restructuring the set-up of a supply chain, via reshoring or near-shoring or from adjusting inventory holdings to reduce the burden at the last mile, the cheaper and quicker route is through the use and exploitation of data, particularly in the last mile, which is overwhelmingly the most expensive part of modern retail supply chains. Areas like route optimisation, transport asset utilisation and packaging solutions are some areas of high focus currently.
For more on how retailers are reducing mileage and utilising data more effectively, download the cutting through complexity and climbing costs in consumer goods supply chains white paper now.