Auditel Consultant:
Simon Beechinor

No need for a crystal ball …

04 Mar 2010 | Filed under: Cost management, Shipping & Transport

I’m a firm believer that if many of us would like a crystal ball to let us know the future movements of the economy … just watch the logistics sector. If you see nice things happening in logistics then nice things will bubble down to the wider economy.

A very brief snapshot of logistics today shows the Baltic Dry Index is flat compared to the heady days of 2008, the container shipping market has laid up nearly 10% (on slots) of capacity and carriers are slow steaming their vessels. The bulk capesize market is in collapse with gluts of ballasted vessels in both the Pacifc and Atlantic. Closer to home at least three hauliers have gone into administration (those in the headlines anyway) this week and doubtless there are others. There are one or two glimmers of joy, but the general view in the sector is one of more pain and consolidation to come.

In short then, that means more pain and consolidation to come for us too. If there is any business that sees green shoots of recovery then just double check the crystal ball.

A retailer said to me recently that he didn’t need to worry about cost management just yet because he was making so much money. Well … any of my readers will spot the obvious flaws in that argument. Please, one way or another sort out those costs – look in the mirror that is logistics and see your future in the reflection.