The logistics market is changing and that presents new challenges for the UK Warehousing Association. As a result, says chairman Derrick Potter, the association needs to be forward thinking in developing its operations.
UKWA was set up in 1944 and now has more than 600 members control nearly 100 million square feet of warehousing space from nearly 1300 locations across the UK. Consolidation means that the big companies are getting bigger.
Potter points out that the association has traditionally drawn its membership from the third party logistics sector. “Most of our members are in the smaller category,” he says. “We are at a turning point – and we are determined to be forward thinking.”
For a start, UKWA has changed is conditions of membership which is opening up membership to a wider constituency beyond the 3PL base. The changes also open the way for members to offer clients transport as well as warehousing under the UKWA conditions.
Potter points out that with globalisation pushing manufacturing out to Eastern Europe and the Far East, the requirement for warehousing in the UK is increasingly opening up opportunities for UKWA members to form relationships with the freight forwarders.
Of course, with manufacturing moving offshore, manufacturers now have surplus space – some have been turning factories into warehouses. This makes them potential members for UKWA.
The association is also encouraging equipment suppliers to get involved. Potter points out that UKWA could provide the ideal networking opportunity for them.
As well as bringing in new members, the association is also working on new ways to involve members in its activities. For example, it is combining regional meeting with visits to interesting logistics sites.
And UKWA is developing its range of services to members. For example, in October, it formed a partnership with The Resources Group to provide material handling equipment training for its members. It is known as UKWA Training, and courses include forklift truck, lorry mounted crane, overhead gantry crane, LGV licence acquisition and driver assessments. Potter points out that training is not being taken up enough. “A lot of our members are small and don’t know how to access the funding that is available. We are well placed to help companies through that process.”
One of the challenges facing UKWA members is the change to the industrial rating system which means that from next year companies will have to pay rates on buildings that are not in use.
The government reckons it could raise some £950 million a year through this – it is certainly going to have a big impact on how warehouses are managed.
Potter says UKWA is bringing the implications to the attention of the industry. There are real problems, he says. There are peaks and troughs in the business cycle and there are some companies that only need warehouse space for six months of the year.
And if a 3PL loses business, then it is faced with a double whammy through the loss of revenue plus the rate payments.
Ultimately, says Potter: “We want to be seen as a proactive organisation making a difference in the marketplace and keen to embrace new technology and ideas with enthusiasm.”
Potter was a strong advocate of rail freight long before it became fashionable with all the concern for global warming. He says he is encouraged by the renewed emphasis on rail freight from the government and rail industry but he points out that the people who are best placed to move freight onto rail are the road operators.
The Potter group is now getting involved in trials of innovative rail freight solutions which could result in more traffic moving off the roads.
There are always going to be constraints, he says. A train is a fixed cost and you have got to fill it to be competitive. There are capacity problems on certain routes. And, he says, Network Rail has got to get better at making the track available on a 24-7 basis. At the moment rail freight operations can be stymied because Network Rail has taken “possession” of the track for maintenance and it could be more efficient in the way it manages this process.
- Derrick Potter is founder and executive chairman of The Potter Group.
- The Potter Group now has five distribution centres. In total, the sites cover 310 acres and have 160,000 sq m of warehousing.
- Potter is a strong advocate of rail freight as part of a more integrated transport strategy. He has been active in transferring goods from road to rail through the three Potter Group rail freight terminals. He is on the board of the Rail Freight Group.
- He became chairman of UKWA in July, succeeding Charles Watt of Store-It-All. Potter is a Fellow of the Chartered Institute of Logistics and Transport and an honorary Fellow of IoTA. He is active in the European Logistics Users Providers and Enablers Group (ELUPEG) and the European Freight and Logistics Leaders Forum.