Businesses going bust, job losses and rocketing Christmas prices for consumers.
That’s the festive doomsday scenario facing the UK’s retail sector as the southern port of Felixstowe – the UK’s busiest container port – hits a cargo loading and unloading backlog.
The legacy of a failed IT rollout in June and ongoing shortage of haulage capacity has resulted in an ongoing packed quayside and half empty warehouses as shipments take up to 14 days to process rather than the usual three to five days.
Retailers using the port to import goods are now facing:
- Increased fees for each container caught in the logjam and unable to move.
- The price of haulage increasing to ferry containers which eventually escape to their destination.
- Potential to lose out on sales at Christmas and Black Friday in late November – crucial periods for retail sector companies.
- The prospect of having to lay off staff or even having to close.
Peel Ports Chief Executive Mark Whitworth, who heads Liverpool2 – one of the world’s most modern container terminals – said: “When will retailers and importers tell freight forwarders and shipping lines ‘enough is enough’ and demand they bring their goods into the UK via northern ports which have the capacity to process shipments within days rather than weeks?
“Around 60% of containers which enter UK ports are destined for warehouses north of the West Midlands. Even before the current issues at Felixstowe it made complete sense to avoid the growing congestion both at the southern ports and on the roads and railways used for bringing containers north.
“But the long delays at Felixstowe have now made it an imperative for shipping companies and importers to think again. I’m calling on retailers to avoid a doomsday scenario for themselves, their staff and their customers and demand they look north.
“We have the capacity and we have the most modern systems in place. We also have the Manchester Ship Canal, which can carry containers unloaded at Liverpool2 straight into the heart of the North West and then beyond across the north of England and Scotland by accessing a motorway and rail network that is far less congested that the South East.”
Major shipping lines, ACL, CMA-CGM, MSC and Maersk already use Liverpool2 and the Port of Liverpool has seen an 8.7% year to date rise in containerised traffic, and Chinese shipping giant COSCO this week tests the water with a 1000 TEU shipment to Liverpool for the first time.
Whitworth added: “The message is obviously spreading in the industry that there are great benefits in shipping to the heart of the UK market, but for the sake of the retail sector more have to make the same decision.
“The perilous state of the UK retail sector is well-documented, with 32 large UK retailers going into administration with resultant economic and social impact since 2008 – a string of retailers from Toys R Us and Maplin to House of Fraser and BHS, and others like Mothercare and Carpetright resorting to company voluntary arrangements. Even star companies are not immune with Superdry this week issuing a profits warning.
“Retailers have to avoid shooting themselves in the foot by continuing to use congested southern ports when an alternative is available.”
