Logistics growth 'prevented by cash and congestion'

Date: 3/8/2011

The two main risks to growth within the UK's logistics sector have been identified as road network quality and difficulties when accessing finance.

According to the Road Haulage Association (RHA), congestion is a particularly deep concern for the industry and has been for several years as it can cause costs to rise and efficiency to fall.

RHA Director of Policy Jack Semple adds that problems with cashflow have been a worry since the financial crisis of 2008 and that access to money remains a troubling concern for small and medium-sized UK enterprises.

"The road haulage and distribution sector is particularly disadvantaged. Diesel suppliers require payment within one week or, in many cases, before delivery - and fuel accounts for more than one-third of the operating cost of a large truck," he explains.

Furthermore, Mr Semple notes that there is growing evidence that many operators' customers - including large clients - are taking prolonged periods to pay their bills.

According to the Freight Transport Association, heavy goods vehicle operators have had to secure an additional £1.3 billion in the last year in order to cope with the rising cost of fuel.

Posted by Mary Treen