Cost is top priority for logistics operations

Reducing transport costs remains the biggest objective for logistics operations according to a customer survey by Paragon Software Systems.

Over half of respondents (57.3 per cent) said that targeting savings is their main priority followed by improving planning accuracy (14.5 per cent) and increasing profitability (9.7 per cent).

However, these businesses anticipate a number of barriers – including lack of investment, a skills shortage, economic uncertainty and eroding margins – which will be exacerbated by the impact of Brexit and increasing pressure on the road network.

A third said the biggest challenge to their business was the growing driver and skills shortage. Rising transport costs was second (26.3 per cent), followed by a reduction in economic growth (18.6 per cent).

Furthermore, respondents suggested that from a transport planning perspective a lack of investment, operational data, system integration and management buy-in was affecting their ability to achieve key objectives moving forward.

While only 5.9 per cent of operators pinpointed Brexit as the most significant issue over the next 12 months, 59.3 per cent believed it would have a negative impact on their business (15 per cent of respondents thought the impact would be significantly negative).

Paragon managing director William Salter said: “The findings of our customer survey highlight the ongoing pressures facing the logistics sector in terms of reducing transport costs, business profitability and operational resourcing. These organisations increasingly recognise the importance of transport optimisation and are using our routing and scheduling software to re-assess their strategies, achieve operational savings, improve service levels and make best use of their assets.”