UK transport firms are seeing huge spikes in their business-to-consumer (B2C) trade, as Fortec Distribution Network members adapt and thrive in the new COVID landscape.
The coronavirus has been interesting for logistics companies, with the Association of Pallet Networks (APN) reporting a 37.7% increase in B2C volumes in the first nine months of 2020 compared to the same period in 2019. In April and May this year, pallet deliveries to residential addresses was more than double the 2019 figures.
Buying habits have shifted, online ordering to private addresses has skyrocketed and, for many of the 80+ members of Fortec Distribution Network, this has resulted in new processes and a change of approach.
With Christmas on the way, the pallet network – which has 24 years of experience as a leading logistics company delivering palletised freight – is seeing no signs of things returning to pre-COVID buying behaviours.
Fortec Distribution Network’s Managing Director, Adrian Bradley, said: “For many of our member companies the landscape changed almost overnight and B2C trade shot up – this trend has continued.
“Many business customers closed their doors to work from home, new businesses were set up in houses, people were furloughed – it all had an obvious knock on effect on online shopping, and the decline of high street shops has had an impact too.
“The practicalities of responding to a B2C market has brought many challenges for lots of our members, and we have been supporting them over the last six to eight months to help them to manage. There have been some real success stories from logistics firms that are thriving with the change.”
Brackley-based NGC Logistics ploughed ahead with a major restructure and joined the Fortec Distribution Network during the pandemic.
Pallet distribution remains the primary service offer for the international courier – which operates from a 30,000 sq ft warehouse and has a fleet of over 1,300 owned and private vehicles. With a £40m turnover, NGC Logistics’ substantial client base is made up of large e-commerce businesses.
Managing Director, James Hadley said: “The profile and demographics of e-commerce has shifted, and over 50% of our deliveries now are to private homes – pre-COVID it was around 25%. In March during the first lockdown we saw volume drop right off. Then, after two weeks, things picked up again as more people started ordering online – turf, rowing machines, DIY and garden equipment, and bulky items that needed pallet distribution.
“We were already operating more efficiently as a result of our restructure, but if we are to meet our business objectives to open more service centres UK-wide, we need to drive more volume, achieve a better balance from our freights, and have the ability to deliver bigger pallets. The changes we have made to the business is already proving beneficial and we are definitely more flexible as a company to respond to COVID and the B2C market.”
Before COVID Masterfreight in West Bromwich served predominantly business customers – a huge 90% of B2B freight which included a wide variety of businesses in many different sectors.
The company’s transport manager, Richard Johnson, says because of the vast area they cover, they have been able to adapt quicker than many to the new split of 40% B2C and 60% Business-to-business (B2B).
“We cover Birmingham, Dudley, Walsall and Wolverhampton postcodes, so we would often deliver to residential and urban areas before the pandemic. All our vehicles have tail lifts to safely load and unload trucks to all sorts of properties, and pump trucks are included as standard too, which again gives us a bit more leeway as to how far we can deliver pallets at home addresses.
“We have responded to the different expectations of consumers too. We are the last cog in the wheel, but we don’t always have communication with the consumer until the drop which can make things tricky. We have good customer service training in place and our drivers are used to managing the situation when delivering to stoned driveways, side access and narrow doorways.”
Pre-COVID, Nexis Services Ltd in Peterborough targeted premium SME business customers, and processes and procedures were very much geared towards servicing this market.
They have since created an entirely new business model to respond to the new 60% B2C and 40% B2B split.
Debbie Swinscoe, Director explained: “Our drivers have been used to building a rapport with their regular business customers and have a system, usually with the same members of staff, who are ready to accept the pallet.
“Consumer customers are usually one-off deliveries, so drivers do not know what to expect and the equipment available for unloading is limited. This all has massive implications on health and safety and predicted delivery times, as well as cost implications too if products get damaged.
"We have put new health and safety guidance in place, developed new customer service procedures so that we call all consumers to offer a two-hour deliver window, and we’ve even addressed our recruitment procedures so we can employ an adequate number of trained drivers ready for more home deliveries over Christmas peak.”