Supply chain costs are being driven up by above inflation rises in warehouse rents as a result of the shortage of good quality affordable warehouse and distribution space, John Maguire, chairman of the UK Warehousing Association, has warned.
Speaking at the association’s annual meeting, Maguire pointed out that this was putting additional pressure on the already tightly squeezed margins of companies operating in the UK’s logistics industry.
“Throughout the UK there is a lack of new buildings and sites under five years old built to a high specification and this has tipped the market in favour of landlords,” Maguire said.
“It would appear inevitable that any increases in rents will result in price increases across the supply chain – which will not help the broader economy as it seeks to recover from doldrums.”
He pointed out that over the past three years the supply of new build or refurbished industrial accommodation has fallen steadily to the point where it now represents just 11 per cent of all available stock. Currently 84 per cent of all available storage space in the UK is classed as second hand.
The lack of good quality accommodation is leaving many 3PLs with little alternative but to put off decisions to take space rather than take poor quality stock, he said.
“In many cases companies are reconfiguring their existing facilities to accommodate new or growing accounts.”
UKWA award for Hunt
Richard Hunt, chairman of the London Ambulance Service, has received the chairman’s award in the UK Warehousing Association awards.
Hunt has been chairman and subsequently president of the CILT, and was chief executive of Exel Logistics Europe before its merger with DHL. He has worked with Cranfield University and the Highways Agency Advisory Board and was awarded the CBE for his services to Logistics and Transport in 2004.
Elddis Transport (Consett) won the environment awards for a series of green initiatives.
Amethyst Group took the team of the year award for its Fradley Park distribution centre which recently increased throughput by 25 per cent.
Warehouse manager of the year went to Boughey Distribution’s Steve Nelson.
Young Employee of the Year was Joanne Dolan of Paul Ponsonby Ltd.
The training award went to Briggs Equipment for its forklift service engineers’ apprenticeship scheme.
RediRack collected the technology and innovation award for its recently developed automated pallet storage, retrieval and sequencing system.
Century Logistics took the customer service award while the best new member award went to Williams Shipping.