A significant shortage of warehouse space risks further delaying Christmas stocks, which are already threatened by a growing backlog at UK container ports and a shortage of lorry drivers, businesses have warned.
Warehouse operators reported the industry was “cramping at the seams” and said companies were running “alarmingly” low in time to prepare for the busiest period of the year.
With firms competing to fill thousands of vacancies, space constraints are compounded by a severe shortage of warehouse workers.
Employees are being offered a salary hike of up to 30 per cent which is expected to be passed on to customers as margins are very tight in the logistics industry. The increment comes on top of a more than five-fold jump in the cost of shipping a container of goods from China.
Shoppers are being advised to expect longer delivery times, higher prices and fewer options.
The boom in online shopping during the pandemic has caused warehouses to fill up quickly, while businesses have responded to the chaos in global supply chains by creating stock, putting further pressure on limited space.
Industry leaders say a cumbersome planning system means they can’t build new warehouses fast enough to meet demand.
It comes as shipping firms have been gripped by gridlock this week at Felixstowe in Suffolk, the UK’s largest container port, where a lack of lorry drivers has led to piling up of goods in warehouses.
“The ports are capable of moving boxes and loading and unloading ships; The problem is moving goods in and out of the port, said Tim Morris, chief executive officer of Major Ports Group. “We have to manage the storage space very carefully. The problems start when it gets full.”
Businesses face long waits to get their goods out of ports and are being forced to divert goods to Rotterdam and other European logistics hubs. Small ships are hired to carry goods in the UK.
Gary Whittle, warehouse operator Meechers Global
“We have a backup of stock for weeks,” said Phil Chesworth, managing director of industrial equipment supplier Midland Pallet Trucks. “The containers that arrived in this week will no longer be delivered till November. it’s terrible.”
Containers that cost £3,000 before the pandemic now cost £20,000. “To us, goods in a container may only be worth £36,000,” said Mr Chesworth.
Some of Midland’s goods are stuck in China as shipping firms are prioritizing a lighter-weight cargo that is more profitable to ship, Mr Chesworth said. “We’re at the back of the queue.” The problem of storage has added to the rising bill.
“We are paying more than the minimum wage, but we cannot recruit employees. When the containers are rolled out we are struggling to get the workers off the boxes and keep the stock on the shelves.
“The situation will not improve this side of Christmas, certainly not. Entry-level warehouse roles would typically be filled in September to cover the peak period of two weeks, so the industry could be dangerously out of time. Used to be.
Shipping giant Maersk reported earlier this week that it was re-routing some ships after a logjam of containers off Felixstow, Britain’s largest port.
Source: Reuters
