A Government business survey shows 23.5% of transport & storage companies expect their turnovers to decrease this month, a gloomier prediction than for any other sector. ParcelHero says rising energy costs are damaging the confidence of delivery and logistics operators.
June’s Jubilee plans failed to boost the spirits of the transport & storage sector, with 23.5% of operators fearing their turnover will decrease this month, according to the latest Government business survey.
The home delivery expert ParcelHero says the Office for National Statistics (ONS) 1 June ‘Business Insights and Impact on the UK Economy’ Survey revealed transport & storage sector leaders were more pessimistic about the prospects for the month ahead than those in any other sector.
ParcelHero’s Head of Consumer Research, David Jinks M.I.L.T, says: “Parcels, logistics and warehouse operators clearly saw few reasons to celebrate the arrival of June, despite the Platinum Jubilee festivities. When they responded to the survey in late May, more transport & storage companies thought they would see a dip in income and profits than those in any other sector. That includes wholesale & retail businesses (22.4% of which thought turnover would decrease) and manufacturing (20.4% of which thought their turnover would fall).
“The reason for this platinum-plated pessimism is not hard to see, given that 72% of transport & storage companies said their business costs had increased. This compares with increased costs reported by just 54.2% of wholesale & retail traders and 61.6% of manufacturers, according to the latest figures.
“Despite rising costs, only 32.6% of transport & storage companies were expecting to put up their prices to customers in June, the same as wholesale & retail traders. This is substantially less than the 44.5% of manufacturers planning to up their prices.
“Transport & storage businesses often work on wafer-thin profit margins and are generally the first industry sector to feel the squeeze of events such as the Ukraine war, soaring energy costs and Brexit. The problem for some companies in the transport & storage sector is that volumes have been falling back since the end of the online sales boom created by the pandemic. Yet, at the same time, they are facing escalating costs. 34.4% of those transport & storage businesses planning to increase their prices in June say the primary reason is higher energy costs.
“The next set of figures are released on 16 June. Perhaps these will reflect a rise in confidence but, for now, the transport & storage sector clearly sees little reason for flag waving.”
To find out more about how logistics companies and their partner retailers are innovating to reduce costs and maximise the potential of technology, see ParcelHero’s study on “Dark Stores” and the High Street of the future on their website.
For more news updates, check out our Q2 2022 issue here.
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