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Optimism for Logistics Industry heading into 2022

CX Transformation logistics

A new logistics index has suggested the industry is navigating industrial action and global supply chain challenges to maintain job creation and growth expectations.

 The latest edition of the CartonCloud Logistics Index took the pulse of warehouse and transport businesses in the third quarter of 2021 with an industry survey where respondents provided feedback on business operating conditions, workforce and hiring outlook, growth, opportunities and challenges.

CartonCloud founder Vincent Fletcher says the latest CCLI provided the deepest insight yet with current data able to be compared to sentiment collected in the first and second quarters of 2021.

“The industry has registered its most positive level of sentiment so far this year and that’s despite industrial activity over the last 12 months and global supply chain issues,” he says.

“A strong logistics industry means a strong Australian economy and business sentiment is high across the economic outlook, performance expectations over the next six months and hiring potential. The industry is now smack bang in a period of massive activity. An overwhelming 90% of respondents believe the final quarter will be the busiest months of the year as Black Friday, Cyber Monday and Christmas ramp up consumer spending.”

“Many companies are looking to invest in additional staff, increase their fleet, optimise operations with new technology and leverage third party providers in order to manage surging demand,” Vincent adds

The CLLI revealed the potential of growth through the busy summer sales season meant optimism remained high for many companies.

Disruptions caused by industrial action and global supply chain delays were felt to have had an impact across the board with varying results, from no impact to major impact recorded. The most significant impact was perceived by those in senior manager/business owner roles, and from respondents from combined warehouse and transport companies.  

CCLI respondents say the industrial actions and global delays meant increased freight and other costs, delays in receiving parts or goods, delayed deliveries resulting in reduced warehouse storage rates and uncertainty around forward planning.  

“Despite disruption to supply chains, the results of the index point towards a robust logistics industry able to adapt to economic challenges that emerge in Australia and overseas,” Vincent says.

“There is a lot of enthusiasm amongst warehouse and transport companies and that is setting up the industry for a strong end to 2021 and a positive start to 2022.

CartonCloud Logistics Index Snapshot

  • All respondents view the current climate as either positive or neutral. Respondents from warehouse and transport combined businesses responded with significantly higher optimism (74 per cent) than those from warehouse (67 per cent) or transport (40 per cent) companies alone.
  • All of transport businesses predicted business performance in the next six months to be good or very good — only slightly higher than that of warehouse and transport combined companies, with 95 per cent of responses for good or very good. 
  • Hiring potential booms, with greater optimism for hiring in the coming six months.  Overall, Q3 responses for the likelihood of hiring new staff in the coming six months saw a much more positive response than in previous quarters.
  • The most popular planned activity to cope with expected increase in demand across the industry is hiring new staff (58 per cent), followed by outsourcing services (39 per cent), and investing in new technology to increase output (39 per cent).
  • Combined logistics companies and high-level management are feeling the impact of recent industrial activity.  Just short of half of respondents in senior managers/business owner roles said they had felt major impact from the industrial actions (44 per cent).
  • In general, there is a consistent perception that competition has increased over the past 12 months across all industry types. This was most visible in responses from the transport industry, with 40 per cent of respondents believing the competition has increased in the past 12 months. One third of warehouse respondents agreed (33 per cent), slightly ahead of warehouse and transport respondents with 32 per cent.

Industry members can download the latest CCLI by completing the fourth quarter survey here: https://forms.gle/TyrQo5pFsPkHBLSE6. Previous versions of the report can be found at cartoncloud.com/cartoncloud-logistics-index-archive

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