Dachser’s response to the UK’s dynamic retail sourcing patterns
The complexities of supply chain dynamics have never been so varied as those currently experienced by much of the retail sector. Through a combination of well-established North African services and new network extensions in Turkey and Eastern Europe, logistics provider Dachser stands ready to help UK retailers cope.
Northampton, 28th October, 2020
The COVID crisis, a boom in online shopping and the looming, yet uncertain effects of Brexit all add to retailer’s urgent need for their supply chain service providers to move fast in adapting to changing sourcing patterns.
While the Chinese manufacturing phenomenon has radically reduced UK retail prices over the last two decades, the cost of sourcing in China has long been on the rise, with other Asian economies benefitting from their lower labour costs. The COVID crisis as an accelerant of change, however, may well be encouraging the trends for near-sourcing policies to be re-energised as longer supply chains are seen as more susceptible to disruption.
Added to this trend is the current boom in omnichannel sales channels. The Office of National Statistics (ONS) figures show that in April this year, 30% of retail sales in the UK were conducted online. This figure compares with just 18% in the same month last year and 21% at the Black Friday/Christmas peak in 2019. Much of this online market is made up of fashion items and clothing that are changing in nature as lifestyle changes are forced on a ‘lockdown’ population.
Shorter lead times on textile products are being demanded by retailers of their manufacturers, and that means transit times of 4 or 5 days, by road and ferry from Tunisia and Morocco are preferable over 20 to 30 days by sea from the Indian sub-Continent, China and other Asia origins. The option of airfreight with transits comparable to North Africa at 5 to 6 days door-to-door, is far more expensive and currently lacking in capacity.
The ‘groupage’ and partial load services that are offered by Dachser enable customers to have the ability to move freight in smaller quantities regularly from the region. The UK retailer need not commit to the high-volume orders of items required when shipping full container loads from Asian origins.
Reliability of delivery is also crucial to the UK retailer. Merchandise delivered when expected and indeed arriving intact, are standard requirements for the fashion retailer to stay competitive. Again the shorter, overland North African supply chain has its advantages against the Asian alternative.
Dachser has operated in these regions for over 25 years, with its own branch offices strategically located in Tunisia and Morocco. The services are driver accompanied direct weekly road freight departures, utilising box trailers for added security.
This service provides reliable support for a wide range of industries, in addition to retail, and the fast transit times help customers improve and develop their supply chains, whether feeding the manufacturing process or for onward distribution.