Concern amid celebration
12 December 2012
A shortage of new warehouses is adding to supply chain costs, warns the UKWA. Yet, despite the difficulties, the Association celebrated the year with its annual dinner and awards, which attracted a record number of entries
The lack of speculative industrial property development in recent years has resulted in an acute shortage of good quality, affordable warehouse and distribution space. This paucity of decent facilities in prime locations is driving above inflation increases in rents as landlords seek to cash-in which, in turn, is putting additional pressure on the already tightly squeezed margins of companies operating in the UK's logistics industry.
That was the message from John Maguire, national chairman of the United Kingdom Warehousing Association (UKWA) in his address to UKWA members at the Association's Annual General Meeting, held recently at the Dorchester Hotel, London.
"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," John Maguire said.
"It would appear inevitable that any increases in rents will result in price increases across the supply chain." 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 situation is unlikely to ease in the immediate future as uncertainty arising from the Euro crisis seems certain to delay the return of significant levels of speculative development activity.
"Along with the retail industry, the third party logistics service sector continues to drive demand within the industrial property sector but 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. In many cases companies are reconfiguring their existing facilities to accommodate new or growing accounts."
Awards roll of honour In happier news, companies and individuals across the warehousing and third party logistics sectors were rewarded for excellence at UKWA's Annual Awards for Warehousing 2012 ceremony, which was also held at the Dorchester. This year the Association received a record number of entries in all categories.
A total of nine awards were presented and the winners were: Young Employee of the Year Joanne Dolan - Paul Ponsonby: In her first year with the company, Joanne recruited nine new accounts, and redesigned Paul Ponsonby's website. Environment Award Elddis Transport (Consett): The judges were impressed by green initiatives such as designing a bespoke 'spoiler' for vehicles.
Team of the Year Amethyst Group: The company's Fradley Park dc near Lichfield recently increased throughput by 25%.
Warehouse Manager of the Year Steve Nelson - Boughey Distribution: Since Steve joined there has been a significant improvement in efficiency and productivity within the warehouse.
Training Award Briggs Equipment: The company impressed the judges with its forklift service engineers' apprenticeship scheme.
Technology/Innovation Award Redirack: The company won for its recently developed automated pallet storage, retrieval and sequencing solution.
Customer Service Award Century Logistics: If a customer finds a task not part of its core business, Century develops a bespoke service in response.
Best New Member Williams Shipping: This is a corporate award given to the company showing the highest professional standards of warehousing on joining UKWA and this year it went to Southampton-based Williams Shipping Transport.
Chairman's Award Richard Hunt: Best known for his work with the Chartered Institute of Logistics and Transport, Richard was chief executive of Exel Logistics Europe before its merger with DHL.