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logistics industry

Industry Insights: The Growth of the Logistics Industry

The logistics industry is massive and with demand for logistics services growing, thanks to the rise of e-commerce, it is continuing to grow at a rapid rate. Keeping up with consumer behaviour and the demand for goods supply in the UK, companies, retailers and individuals now rely on logistics services more than ever before. With so many challenges being thrown at the industry in the last few years, such as Brexit, COVID-19 and more, it is certainly interesting to analyse just how the industry has faced these and grown. 

How The Logistics Industry Has Grown

As the nation embraced e-commerce and the use of digital platforms, the logistics industry in the UK has experienced a boom in growth over recent years. This has resulted in a large number of new and existing logistics and courier companies taking to Britain’s roads to ensure customers receive their products with a fast and smooth delivery. 

Key statistics and facts from the latest Logistics UK Report (2021) show us the size of the logistics sector in the UK and how vital this is:  

  • Contributing a massive £127 billion Gross Value Added (GVA) to the UK economy 
  • There are 205,380 logistics enterprises in the UK
  • Online retail contributed an average of 28.1% of retail sales in the UK (up from 19.2% in 2019). As this figure continues to increase the use of courier services and delivery companies will increase, placing much more pressure on the logistics sector to meet the needs of online retailers and their customers. 

In their Skills and Employment Report in 2020, it was reported that ‘in Q2 2020 the wider logistics industry employed 2.58 million people’. Showing just how big this industry is and what a key role it plays in the lives of people up and down the country. 

Challenges Faced By The Logistics Industry

On top of increased demand in the industry, logistics has been experiencing huge driving changes in the way goods have been transported into and throughout the UK. Due to the current effects of Brexit and the recent COVID pandemic, the industry has had to face some huge challenges. Its resilience in the face of these continues to demonstrate the importance of logistics to the UK. 

The Coronavirus Pandemic – Despite the spread of the Coronavirus across the UK, the logistics industry had to meet the needs of more and more customers throughout lockdown. As online sales increased and demand for at-home deliveries rose, those within the supply chain felt the pressure. The lockdown required fast adaption from the industry which has led to a rise in the use of technology within the industry to keep up with demand. 

The Future Of The Logistics Industry

As demand places pressure on the logistics industry to make big changes and environmental impacts lead to questions around sustainability, what can we expect for the industry in the future?

The industry is forecast to experience a growth rate of 2.5% during the period 2021 – 2026. With technology entering the forefront of key operations within the sector. Taking a new approach to old traditional methods in order to satisfy customers and meet the requirements of governments and more.

However, as the industry contributes greatly to the global carbon footprint, changes and innovations must be implemented in order to create a sustainable industry. One which takes active steps in creating a greener world for future generations. Due to government pressure we have already seen the logistics industry beginning to adopt the use of electric and hybrid vehicles, reducing journey time, opting for clean energy sources and more. 

Revolutionising On-Demand Logistics

As the industry continues to grow at a steady pace, join DeliveryApp on our journey to revolutionise the sector. With technology at the core of what we do, we are putting customers in the driving seat. Providing a simple, ethical and affordable solution for on-demand deliveries. Find out more today

Written by Tom Glover

Tom

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