What’s 2021 got in store for the transportation & logistics sector?
2020 is (finally) over and, compared to this time last year, everything’s changed.
Brexit is finalised and we’re back in a national lockdown, so what does that mean for businesses making their own deliveries in 2021?
Crucially, businesses need to have a strong online presence and, as an extension of that, they need to be able to deliver goods safely and efficiently.
The Brexit transition went into effect from 1st January 2021, with changes to how we import goods to and how we export goods from the EU, as well as how we move goods into, out of, or through Northern Ireland.
Our founder and MD, Dave Pickburn, pointed out that: “any downturn in the economy caused by Brexit will obviously be bad for the economy of the UK and if it’s bad for the economy, it has the potential to be bad for Stream subscribers and the delivery sector as a whole” but added that he doesn’t believe Brexit will have too much of an impact for most of the Stream community, most of whom have a good online presence, and the wider sector.
How will the third lockdown affect the delivery sector
The UK went into its third national lockdown on the morning of the 5th January 2021.
Speaking about the first lockdown (which started in March 2020), Dave noted that, for the Stream community, deliveries and orders took a very sharp drop, followed by a relatively quick return to normal volumes.
Looking at Stream Analytics data, we can see that January, February and most of March 2020 were pretty much normal, in terms of order volumes, but late March and early April saw a dramatic drop.
Over about three weeks, the number of orders we processed went into a sharp decline, down to about a third of normal volumes. By early-mid April we’d dropped down to our lowest order volume, and at that point, we were working with the Stream community and helping them out where we could.
The bulk of those customers have bounced back. There’s a small minority that unfortunately haven’t been able to, but what we saw was a significant climb back up, and actually, by the middle of June the community was back up to pre-lockdown levels.
We saw businesses opening back up. Volumes grow. What we also saw was a number of new businesses signing up for Stream, where they were transitioning to a new business model and starting to do more online sales. That climb actually continued, so that by the end of the second lockdown in November, the run-up to peak shopping season, the Stream community had grown and was processing more than double the number of orders they had been processing back at the start of the year.
That second lockdown saw more of a flattening of order volumes than a dramatic fall. This is perhaps because businesses were more prepared by then. Lockdown 2 and 3 haven’t come as a surprise in the same way that the first one did.
“The manufacturing sector hasn’t stopped, the building trades haven’t stopped, construction hasn’t stopped. Some businesses will come to a stop, but I don’t think that’s going to happen as much this time. I think much more will stay open and stay active for online delivery, and click-and-collect, because a lot more have that infrastructure and systems in place now, where they maybe didn’t in March or April” commented Dave.
“I think the sector will probably see similar in this third lockdown, maybe a slight flattening of order volumes, but no real decline against comparable periods. Businesses in some B2C sectors and the parcel market may still see the normal post-Christmas decline in orders.”
Delivery service as a differentiator
“I do think many businesses will be able to grow during this period because I think the switch to online delivery, business-to-business delivery, that readjustment to a large extent happened last April. Some of that increase has been down to an increase in online shopping, the e-commerce sector is growing significantly, but also more business to business transactions are involving a delivery component” says Dave.
As a result, the delivery services economy is not going to be hit that hard. People and businesses still spend money. They’ll just find a different way to spend it than before, and that way will be online, for the most part, and often buying directly from the company that will also be delivering those goods.
Whether that’s B2C e-commerce or B2B, what’s for sure is that, as people are becoming more technologically savvy, delivery is becoming more important. People want to know more about where their orders are coming from, and how they’re going to be delivered, and exactly when they will receive those orders.
“Businesses who are making deliveries are having to up their game. People are becoming savvier about what’s good in delivery management and customer experience and what’s not so good. Consumers expected more, and a lot of businesses are delivering on that, but now businesses are expecting that same level of service as well. They want to know when the driver is arriving. They want to know what’s going on with the goods they’re receiving. Those companies that are delivering goods to businesses are also having to up their game when it comes to delivery service, it’s becoming a real differentiator – and that is only going to continue to be the case”.