The BRC has warned retail prices will rise in coming months © JUSTIN TALLIS/AFP via Getty Images
The BRC has warned retail prices will rise in coming months © JUSTIN TALLIS/AFP via Getty Images

Why collaboration is needed to overcome HGV driver crisis

1 September 2021

Retailers must promote greater collaboration between manufacturers and suppliers to overcome the challenges of the HGV driver shortage, a consultant has claimed.

Rob Wright, executive director of supply chain and logistics consultancy Scala, said firms should communicate with customers and suppliers about how transport can be optimised to reduce journeys.

“It is vital that retailers lead greater vertical collaboration between manufacturers, their customers and suppliers,” he said.

“Companies should be talking to their customers and suppliers about how transport can be optimised to protect service and reduce truck and driver journeys. Now is the time to review delivery frequency and order size, unlock backhaul opportunities and remove empty trucks from UK roads.”

Supermarkets and food chains have been suffering shortages as a result of the driver crisis and the British Retail Consortium (BRC) has warned of rising consumer prices.

Following Road Haulage Association estimates the UK is facing a shortage of 100,000 HGV drivers, Wright called for businesses to consider double decker trailers and collaboration with competitors. 

“As well as vertical collaboration, businesses should also look at the more challenging horizontal collaboration in which companies can work together across the category by sharing trucks and resources,” he said.

“We have found it is often the case that a company’s best collaborative partner is perhaps its competitor, as they face the same challenges, share the same customers and often the same suppliers.”

The BRC said shop prices were below those seen in 2020, decreasing by 0.8% in August year-on-year, but there had been a slight month-on-month rise.

Helen Dickinson, chief executive of the BRC, said: “Food retailers are fighting to keep their prices down as far as possible. But mounting pressures – from rising commodity and shipping costs as well as Brexit-related red tape, mean this will not be sustainable for much longer, and food price rises are likely in the coming months.

“In the run-up to Christmas the situation could get worse, and customers may see reduced choice and increased prices for their favourite products and presents.”

Dickinson repeated calls for the government to allow temporary visas for EU drivers to help fill driver gaps, despite the business secretary Kwasi Kwarteng telling businesses they should be "utilising the strength of our domestic workforce".

She said: “Without government action it will be the British consumers who will pay the price.”

Baby clothing brand JoJo Maman Bebe has announced it will raise prices after the business saw shipping costs quadruple in recent months.

The company’s commercial director Gwynn Milligan told BBC Radio 4's Today programme businesses had witnessed a rise in the price of raw materials including paper, plastics and wood, which are used in its toys and changing mats. 

While Milligan said the company was having to absorb some of the increased costs to stay competitive with rival companies, she said: "We've had no choice but to pass on some of these costs to our customers.”

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