Logistics in the UK – Everything You Need to Know

The need for skilled individuals, flawless processes, innovation, and high-performance transport vehicles will never go away.

The UK economy received around £127 billion per year, most recently from logistics, and many experts agree that the industry will continue to grow.

Over 200,000 UK logistics companies contribute to the country’s economy. If you’re looking to make your own contribution to this sector, or you need a logistics partner, here’s some important information about logistics in the UK you might need to know.

UK Logistics Enterprise Proportion

Unsurprisingly, the well over 30,000 logistics companies in London are the most incorporated in one area.

However, it’s not uncommon for logistics employment to be spread unevenly. Freight operations heavily influence the UK logistics industry and UK logistics jobs.

While other areas like the North West or the South East have proportions of 13% in logistics employees, London maintains a firm 9% as of the end of 2021.

Despite the heavy presence of logistics companies in London, the future of UK logistics jobs in the capital is in question.

According to recent logistics UK news, the Ultra-Low Emission Zone (ULEZ) is expected to expand, covering the entire capital, come 2023. Some industry experts are worried about meeting demands without significant investments in low-emission vehicles.

But even if not enough vehicles are rolled out, the ULEZ will mostly impact London, not neighbouring regions.

The Impact on Freight Logistics Companies in the UK

The coronavirus pandemic disrupted the whole logistics industry. It created a global container shortage and record-high levels of warehouse occupation.

But while companies are trying to meet their delivery contracts, it’s difficult to meet the mass transport demands.

UK logistics companies have to rely on freight operators now more than ever to fulfil orders. The market demand and shipping container shortage created by the pandemic has had positive effects on the freight forwarding industry.

Many in the logistics industry agree that freight rates will continue to rise for the foreseeable future. In addition, the push to reduce carbon emissions may also give freight forwarders an advantage should more vans and trucks be taken out of play.

To top things off, two of the UK’s largest trading partners, the U.S. and China, are on different continents. Most imports and exports with these trading partners happen by sea.

Of course, it’s unlikely to see the same percentages of freight tonnage moved by sea as in 2019. The first year of the pandemic saw 95% of all international freight being moved by sea freight operators.

Moving forward, other UK logistics companies will have more room to flourish. That said, the UK is and perhaps will remain a net importer for a long time, which means that freight forwarding should remain highly lucrative and favoured for years to come.

Logistics Franchise UK – A Tip to Thrive

Whether you’re talking about a company with tradition or a new franchisee, UK logistics firms need to plan ahead accordingly to weather any storm and thrive in a somewhat chaotic environment.

While some logistics UK news points the finger at reducing carbon emissions and the impact it can have on jobs, the industry is actually in dire need of workers.

A summary done by the Logistics UK trade association found that the industry had around 1.7 million job openings in 2021.

Furthermore, up to 46% of logistics companies increased gross pay.

Filling open positions is one of the biggest areas of focus for the logistics industry. What does this mean?

Companies that fill their job openings and hire experienced personnel will be in a position to meet demand and carve a larger piece of the market.

UK Logistics Sustainability

How sustainable will the industry be once it deals with the backlog and might shipping companies lower their premium rates?

Logistics companies in the UK are poised to thrive. One reason is the continuing online shopping trend that didn’t slow down after the world came out of the coronavirus.

Restrictions or not, online shopping is highly convenient for consumers, and this continues to increase the need for delivery services.

Furthermore, zero-emission vehicles are in development. As more of them hit the streets, the strict emissions regulations will stop affecting the logistics industry.

What’s even better, decongesting traffic helps delivery drivers get better mileage. This will slowly increase profit margins in the industry. And areas that phase out high-emission diesel vehicles will also benefit from quicker delivery times.

With enough investment in innovation to meet new emission restrictions, logistics companies in the UK can continue to grow sustainably and thrive.

It’s also worth pointing out that the British Government has been consistently investing in the country’s infrastructure.

While most international freight comes by sea, domestic land transportation should have a very bright future. At least £10 billion has been invested in infrastructure restoration work so far. With more money likely on the way, new routes will become viable, and land transport will be a sustainable alternative to air freight and cargo trains.

Logistics – A Driving Force for the UK Economy

Given the amount of money pumped into the economy and the vital role the logistics industry plays in the supply chain, it’s impossible to think that the industry doesn’t have a bright future.

The best move for many entrepreneurs might be to start a logistics franchise. UK regulations make it easy to break into this sector, although the required capital isn’t available to everyone.

That said, the industry receives plenty of support from the government. Thanks to this and to companies working tirelessly to resolve the coronavirus-induced backlog, anyone who needs cargo transport can find a freight forwarding company to fulfil their order.

Logistics companies in UK territories provide a wide range of services and shipping methods, including air freight, which is slowly recovering post-pandemic.

As long as the country remains mainly an importer, which is unlikely to change given its industry, climate, and positioning, this will remain one of the most lucrative sectors for private companies and government-owned service providers.