London, UK: Most of the major players in the chilled and frozen distribution market are confident about their growth in 2013, while acknowledging the challenging economic climate and resultant volatility and pressure on margins, according to a survey by Cold Chain News magazine.
Many plan on buying new or replacement vehicles and some are expanding warehousing and spending on “green” initiatives. NFT highlighted another trend – it expects to see significant growth from online retail in 2013.
Suppliers too are upbeat about growth, expecting many logistics providers to return to the market this year to update their fleets.
Cold Chain News magazine surveyed six of the larger temperature-controlled operators along with Carrier Transicold, Gray & Adams and Thermo King.
A spokesman for Yearsley says that the sector is seeing increased volatility in the supply chain that is a result of reduced lead times.
Culina has also noticed a move towards shorter lead times for deliveries.
Nick Hay, managing director of Fowler Welch, highlights the potential for more “flux” this year. He expects to lose some contracts and win others, attributing this “churn” to pressurised customers switching logistics provider to cut costs.
Mike Flynn, business solutions director at Gist, echoes this cry. “Retailers who are under a lot pressure are looking to keep costs down without sacrificing quality.”
Overall, most logistics providers, including Yearsley, were upbeat about the potential for growth, despite the challenges. “Yearsley Group believes that the outlook is still tough, with margins under pressure, but we expect to grow significantly and have new capacity coming on stream at Heywood,” says a spokesman.
Some temperature-controlled operators even believe that the recession has had a positive impact on the nature of relationships with customers. Hugh Jones, commercial director, Grocontinental, says: “It has highlighted a real need for companies like our own to add value to the supply chain and increasingly become an integral part of customers’ businesses.”
