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Average distribution costs in the retail industry have fallen to their lowest level in five years.
Page 12
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A survey by the institute of Grocery Distribution (IGD) found that transport Is the second-highest cost for retailers, at 34.89,o of total costs; warehousing is the biggest cost, accounting for 56.1%. Overall distribution costs now account for 3.U%, compared with 3.86% in 2001.
The survey, which surveyed major retailers' logistics directors and managers, attributed tailing distribution costs to the introduction of more effective route management, such as backhauling.
Companies have also reduced the average number of days for stockholding, particularly across slow moving goods, non-foods, and beers, wines and spirits. However, the survey also found that the number of deliveries made each week has increased in comparison to the previous year.
Commercial Motor asked IGO about the effects on retail distribution costs of the supermarkets' policy of factory gate pricing, but it declined to comment.