Retailers must look north to find the space to succeed

B&M Stores

Over the last three years, fast-growing discount retailer B&M has taken steps to reroute over half of its UK bound container traffic to Liverpool, away from congested ports in the south.

Operating over 500 high street and out-of-town stores across the UK, access to a geographically broad market was a key driver in looking north for the best shipping, storage and onward haulage option.

With such a focus on value, having a flexible and lean operation is critical to the firm’s business model and its outstanding growth in recent years, particularly around the North West. B&M decided Liverpool made the most sense for them three years ago and never looked back.

Yet retailers continue to use the UK’s busiest, and most congested ports to move their precious stock.

We’ve been vocal in the press recently - predicting a 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 the southern ports 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, the prospect of losing out on sales at Christmas and Black Friday in late November, and even the risk of having to lay off staff, or worse – closing their doors for good.

However, as we approach Christmas – the busiest period for the UK’s retail sector - there is hope within the industry that retailers and importers will 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. Retailers should look to avoid a doomsday scenario for themselves, their staff and their customers and demand they look north.

While it’s vitally important to our success, we don’t rely on our geographical location alone to deliver for our customers. For customers such as B&M, routing through the Port of Liverpool has saved the equivalent of 4 million road miles, massively cutting its onward transport costs, reducing the carbon emitted and reducing the likelihood of delays on the UK network.

And because the port-centric warehousing at the port is multi-user, B&M has not had to enter into rigid, long-term contracts that potentially result in sunk costs without any benefit when stock requirements are lower.

This on-demand approach has been used extensively by B&M since 2013 and has contributed to an extremely efficient supply chain that has allowed the company to add more than 200 stores to its estate during that time – one store a week!

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 than the South East.

Major shipping lines, 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, but we know we can handle more, and help retailers become more efficient.

Retailers have to avoid shooting themselves in the foot by continuing to use congested southern ports when an alternative is available. We know how much sense it makes to use Liverpool – and it’s our hope that retailers follow in the footsteps of firm’s such as B&M this Christmas, before it’s too late.

Blog by B&M Imports Director, Jerome Wildsmith

Major Chinese shipping line announces Liverpool call. More info HERE.

Find out more about the products B&M offer HERE.

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