Last week saw another haulier go to the wall. Since January 2023 it is estimated that more than 300 operators of varying size and experience have met this fate. Those failing have not all been independent local operators, members of nationwide networks with national sales support and reach have also been casualties. The reasons given are numerous; cash flow issues, falling volumes, the failure to overcome the costs and shock of a cyber-attack, difficulty in passing on cost increases, Brexit…. to name a few.
Against this backdrop of financial challenges there is an ever-increasing consolidation of logistics suppliers with mergers and acquisitions becoming increasingly prevalent as bigger players seek to secure market share in an attempt to gain a competitive advantage. Buyers can find that the availability of a suitable alternative, at a competitive cost, may prove to be more challenging than they had expected particularly if a change has to be undertaken at short notice. The shorter the lead time to find an alternative supplier the greater the risk of service failure and the greater the likelihood that the replacement will not provide the optimum solution.
Being aware of threats to your current supplier base is as equally important as identifying suppliers that can meet both your current and future needs. Selecting operators that are stable, financially sound, able to provide competitive services and that can evolve to meet your requirements as you launch new products or enter new markets is likely to be an essential component of your long-term success.
Davies & Robson have been assisting organisations to manage these risks for over 30 years, and have helped logistics users and providers in the key areas of:
- Assisting organisations define the services necessary to support their strategic plans
- Identifying suitable suppliers
- Determining the most appropriate commercial model for the services to be provided
- Preparing and managing the tender process
- Drafting and negotiating suitable contractual agreements
- Ensuring resources and plans are available to ensure a successful implementation process
To discuss how Davies & Robson can support your business in evaluating its logistics outsourcing options and risks, please call us.