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News Release

Birmingham

Supply chain challenges to cause switch to multi-location distribution networks


Birmingham, 14 November 2012 - Companies will increasingly need to be more agile and flexible in designing their distribution networks. Speaking at commercial property adviser Jones Lang LaSalle’s agents briefing in Birmingham, held on 9 November, Peter Ward, Cargo Supply Chain Commercial Manager, DP World London Gateway said that shifts in global sourcing combined with new and multiple channels to market are likely to drive multiple stocking locations.

Peter Ward said: “In the UK it may prove optimal for a major distribution centre in the South to complement another operating in the Midlands.”
 
Explaining the logic behind DP World’s massive investment into London Gateway, the UK’s new international hub port and Europe’s largest logistics park, Peter Ward said this approach would be particularly relevant to companies whose key customer base is in London and the South East, the country’s largest consumer market and population centre.
 
Peter added: “Against a background of escalating fuel costs, London Gateway will save millions of pounds of avoidable costs in UK supply chains.”
 
Meanwhile, Lisa Fitch, Associate Director, Supply Chain Consulting, BNP Paribas, told delegates that the DP World London Gateway port and logistics park development, which offers almost 860,000 sq metres of space and is located just 147 miles from Birmingham, was well timed given current market conditions.
 
Lisa said: “From a Midlands occupier perspective, the opening of DP World London Gateway next year is perfectly timed for a number of end users that are grappling with the challenges of the recession and are having to accommodate multiple channels to market.
 
“The port centric logistics model [where DCs are located close to a port to reduce transport distances] at London Gateway will be compelling for many businesses as it adds capacity to the market that will enable end users to reconfigure their supply chain.”
 
Jones Lang LaSalle, National Director, National Industrial & Logistics, Cameron Mitchell, commented that the country could be facing a shortage of distribution facilities.
 
Cameron said: “There is a shortage of good quality distribution capacity looming as a result of a recession related lack of speculative builds over the last two years.
 
“We therefore welcome DP World London Gateway’s commitment to offer a substantial common-user facility from which businesses can either benefit from incubator or shared space -whilst gaining flexibility in their supply chain - and if the business case is right for them to later move into their own facility.”
 
Richard Meering, Senior Director, CBRE, added: “We welcome the London Gateway development.”
 
“This, along with DB Schenker offering rail services from London Gateway to the Midlands, highlights the potential supply chain benefits that end users can gain by utilising London Gateway in conjunction with Midland’s DCs alongside rail hubs such as DIRFT (Daventry International Rail Freight Terminal), Hams Hall and BIFT (Birmingham International Freight Terminal) at Birch Coppice”
 
Peter Ward concluded that the increasing size of containerships has caused supply chains to become longer and more costly.  He explained how new ports and terminals around the world have been developed further away from population and manufacturing centres because of the need for deeper water that can accommodate these larger vessels.
 
Peter said: “London Gateway is bucking this trend, bringing a new deep water port closer to exporters and importers, not just in London but also Birmingham and the Midlands.” 
 
- Ends -