Published Monday 19th August 2019
Sustainability is having a significant impact on the long-term planning of businesses. Whilst this is affecting all industries, few are being targeted and impacted as much as the distribution sector. Governments and corporations are searching for ways to reduce the industry’s impact on the planet. However, public pressure has the potential to force through changes that could cause severe disruption to vital practices.
Here at Expense Reduction Analysts, we’ve been covering how eco consumers are shaping the distribution sector. In the search for cleaner methods of transport, many new ideas have been suggested. However, in finding something that both reduces emissions and allows businesses to deliver their current service, perhaps the answer lies in the past. When looking for an option that can provide for the environment, government and companies, rail has a case that should be heard.
Distribution’s Role in Modern Business
It is undeniable that distribution is a notable contributor to the greenhouse emissions created in the UK. According to the Freight Transport Association (FTA), representing logistics providers, transport accounts for around one-quarter of all UK emissions. This figure includes all forms of distribution, including road, air and sea. Crucially, it is also one of the most visible polluters to the public in their daily lives, much more so than others, such as animal farming. For this reason, transport has been targeted heavily by the public and, subsequently, government.
However, whilst the FTA and its partners are behind the long-term goal of reducing logistics emissions, they have regularly voiced their concern over the heavy-handedness of recent proposals. The FTA has been particularly concerned about a string of clean-air initiatives in major cities across the UK, such as London’s ULEZ and similar projects in Bath and Bristol. Ultimately, they believe that these sudden initiatives hit transport businesses hard and unnecessarily, compared to other options. Concerning Bath’s Class C charging Clean Air Zone, they said that it places undue strain on “hard-working local businesses and vehicle operators which already contribute so much to the public purse.” They believe that councils “would be better placed to concentrate on traffic management and encourage the uptake of ultra-low emission vehicles.”
The FTA also adds the following statement with regards to these measures. “With Brexit, new technology and other disruptive forces driving change in the way goods move […], logistics has never been more important to UK plc.” This belief is shared by the many major businesses who rely on distributors. However, with environmental concerns mounting, it is clear that something has to change, short-term, to keep government’s satisfied.
The Case for Rail Distribution in Business
Rail transportation is often viewed as somewhat archaic, especially when compared to modern developments such as Euro VI emission-standard HGVs. Despite this, rail has not only been successful in the past but remains successful today. According to Network Rail, rail freight carries over £30bn worth of goods every year, generating over £1.7bn for the national economy.
Nonetheless, many businesses appear unwilling to consider this as a potential distribution method. Many reasons are behind this, including the cost and a lack of flexibility regarding terminals. Modern businesses are also concerned about the impact of using rail transport on their brand in this eco-conscious age.
The rail industry argues, however, that they can provide the eco-friendly option businesses and governments desire. According to Network Rail, each freight train accounts for around 76 HGV journeys. Over a year, this accounts for 1.66 billion fewer HGV kilometres.
Utilising Distribution Methods to Save Money in Your Business
Whilst not necessarily the cleanest mode of transportation when viewed individually, the above comparison shows the potential emission savings that could be made by switching from road to rail transportation. There are also potential economic savings to be found, as fewer HGV journeys mean less money spent on vehicles and drivers.
Environmentalists and the government may argue that rail freight is not the long-term solution to our emission concerns. Still, at a time when the public and politicians clamour for results, rail presents a step in the right direction. As more transport opportunities become available, we would also expect cost-saving opportunities for businesses that rely on transport to increase going forward.
Here at ERA, our specialists work with major UK businesses to help reduce distribution costs. We can work with your in-house team to implement procurement strategies that create substantial long-term savings for your company. With the options available for transporting goods increasing, there is a great opportunity right now to increase efficiency and reduce logistical expenses. If you are interested in seeing what savings our specialists could create for your business, why not get in contact with us today?