Fashion brands are at risk of delays to deliveries of stock in the run-up to Christmas and beyond, as a result of a “perfect storm” of congestion at the UK’s largest container ports, a shortage of haulage drivers and impending Brexit pressures.
Logistics sources have told Drapers some container ships are late arriving from the Far East, while others are being unexpectedly diverted from the UK. This has compounded problems experienced at the ports over the summer.
Sources said the port at Felixstowe in Suffolk is “only just” recovering from issues it encountered after it began implementing a new IT operating system in June. Several carriers were forced to divert their ships to the already-busy ports at London Gateway and Southampton.
The UK head of one menswear brand said a container ship coming through London Gateway was only partially unloaded last month because of time constraints. The vessel diverted to another port, causing weeks of delays.
“I think it’s affected a few people,” he said. “It delayed the delivery of one of our key winter coats.”
James Hookham, deputy chief executive of the Freight Transport Association (FTA), said some of the global shipping lines are making last-minute changes to their destination ports, sometimes missing out the UK altogether.
“It’s got a lot worse, partly because they have been avoiding Felixstowe. Also shipping lines using these next-generation mega-ships tend to be very choosy about where they put them ashore. They want to keep them moving as much as they can. If they don’t have many boxes to unload in the UK, they may skip it.”
He warned that stock could be delayed in the run-up to Christmas: “There won’t be empty shelves, but new stock may not come in as early as usual. Supply chain managers will be getting angsty – if you’re expecting stock to come in at week 44 and it’s pushed back to week 47, that’s three weeks of lost selling time.”
A spokeswoman for logistics company Torque described it as a “perfect storm”: “We have the annual weather issues common at this time of the year [in the Far East and US]. In addition, Felixstowe started migrated its IT systems in June, and it is only just recovering. This impacted Southampton and other European ports as they took additional vessels.
“Southampton also suffered from rail maintenance as trains went from three a day to one for a few weeks, and there is the general shortage of haulage in the UK.”
There are more than 52,000 HGV driver vacancies in the UK, the FTA has said.
“Even when boxes land at Felixstowe or Southampton, there is a crunch on haulage capacity to get from dock to distribution centre, whether by rail or road,” said Hookham. “We’ve had similar problems in previous years but never all at once. And it comes at a time when everyone is on the edge of their seats because of Brexit. We employ about 40,000 truck drivers in the UK that are EU nationals. If we suddenly lost access to them, it would punch a big hole in the haulage capacity.”
“Road haulage very tight at the moment,” agreed another source. “We’ve heard of people having to book two weeks in advance, otherwise you wait at the back of the queue for your haulier.”
He also pointed to problems on the railway line in and out of Felixstowe over the past few weeks: “A driver shortage on the freight trains has led to some cancellations.”
Torque said it expects congestion to increase in the first quarter of next year, ahead of the Brexit deadline: “Some companies will want to import their stock early to lessen the risk of incurring a higher duty rate. European traffic [through Dover] will be impacted the most.”
Last month, Next said interruption to the smooth operation of UK ports represented the “biggest risk to our business from Brexit”.
A spokesman for DP World, which operates London Gateway and Southampton, said: “In the last few months, UK supply chains have been experiencing delays caused by a number of different factors. However, at DP World London Gateway, there have been very few delays. This is despite the port handling additional MSC [Mediterranean Shipping Company] services unable to call at another port, so that shipping lines can turn around in the UK in good time and so that their customers – many of whom are retailers – can get cargo inland and to stores quicker.
“DP World has invested significantly in technology and people at its port and neighbouring warehousing and distribution site on the River Thames, to ensure the biggest ships in the world – calling in the UK from the Far East – can land cargo closer to western Europe’s largest consumer market, and that the cargo can be turned around quickly, reliably and more sustainably.
“We have very good relationships with a large number of retailers and we are willing to work with them where ever possible to ensure their supply chain operations are efficient.”
Hutchison Ports, which operates Felixstowe, declined to comment. However, a source close to the situation told Drapers the IT system is now up and running, and added: “Generally, containers are coming in and out of the ports pretty quickly.”