Exclusive:Zedifyinconversationwithfulfilmentindustryleaders

As we come to the end of 2024 – amidst the busy peak season and mounting financial pressures across the logistics industry – brands, retailers and 3PLs alike are busy preparing for another fast-paced 12 months ahead.

At Zedify, to gather as broad a perspective as possible, we wanted to speak to our industry contacts directly and gain their thoughts on a) what to prioritise, b) concerns to look out for and c) reflections from a rather unpredictable 2024.

We spoke to key players across the sector, including representatives from 3PL companies, carriers, and fulfilment houses, including Bleckmann, Sprint Logistics, Wonderpack.eco, Oakland International and a major 3PL that we can’t name here. They have kindly shed light on the major issues that impacted their operations, from rising costs and recruitment difficulties to ever-evolving consumer demands.

In this latest article from us, get ready to learn about:

• The impact of global political and economic turmoil on supply chains
• How rising costs are affecting both businesses and consumers
• The challenges of meeting evolving consumer needs for faster deliveries and greater flexibility
• The need for improved collaboration between carriers and fulfilment companies
• The industry’s preparedness for the transition to net zero emissions

This post also explores the opportunities and technological advancements expected in 2025, offering valuable insights for those working in or interested in the future of fulfilment and logistics.

Enjoy!

 

 

 

1. In your opinion, what were some of the biggest challenges across fulfilment and logistics in 2024?

Erik Janssen Steenberg, Business Development Manager, Bleckmann [Erik, Bleckmann]: Well, what we are seeing is, of course, political and economic turmoil everywhere: from rising costs in energy pricing, raw materials and wages, to sea straits that are being blocked by pirates. I think we’re also beginning to see pressure on the market because there’s a new president coming in the US, tensions building around China and things staying extremely heated in the Middle East.

Carrier Manager at Top 3 UK 3PL: Really, it’s the same as 2023: Supply issues have persisted due to global conflicts, increasing delivery distances and costs.

Dean Attwell, CEO, Oakland International: 2024 has seen much of the same in terms of geopolitical issues such as the war in Ukraine affecting energy prices and costs, but we’ve also seen some changes including the new UK government which now we know is going to affect costs on National Insurance in 2025.

Stewart Oxley, Business Development Consultant, Sprint Logistics [Stewart, Sprint]: Clients who might be sort of longstanding with you, who in the past were prepared to pay a little bit more because they like to provide a good service. Well, I can’t think of a client that we haven’t had a cost review with in the last 12 months. And I think it will continue.

David Ramirez, CEO & Co-Founder, Wonderpack.eco [David, Wonderpack]: I don’t want to start with the broken record answer, but rising costs, right? We’ve seen them everywhere, year on year on year, and it will be part of 2025 as well.

CM at major 3PL: It becomes very much: show me the money. Show me where you’re going to save me money. Show me where you’re going to increase efficiencies. I’m going to want to get more for what I’m paying. Yeah. That’s probably the most difficult thing for us.

Stewart, Sprint: The surcharges carriers are adding to their bills to cover ULEZ and for fuel are also getting queried more often. If the price of fuel comes down, customers want to know why their bill isn’t going down and it’s like, well, the carrier hasn’t taken it off their bill, so it’s still getting passed on.

David, Wonderpack: Also, recruitment has been a big focus; we’ve been through quite a big recruitment drive. We started the year with around 35 people in our team and are ending the year with 80+ people. Fulfilment is a very dense industry, so getting the right people with sector experience has been one of our biggest focuses this year.

Dean, Oakland International: Specifically at Oakland, we’ve been focused on getting the right people on board, ensuring we have a team that is constantly pushing boundaries and creating the innovation that this business needs. Another cost pressure which has ramped up this year has been increased investment in cyber security protection

Erik, Bleckmann: Consumer demand is quite volatile, too. Black Friday is less peaky than it was in the past, when it was a new concept. And, generally, people are more conscious of when they spend and what they spend. Some brands actually succeed at translating that into their marketing strategy and others not so much. So we see winners and losers, just as always, there are the brands that can adapt, and the ones that are rigid? Yeah, they’re now feeling the pain.

2. How are evolving consumer needs affecting the services you’re providing to ecommerce clients?

David, Wonderpack.eco: Much of what we see on this is driven by what we call ‘Prime Mentality’: needing things yesterday and expecting them to arrive yesterday; therefore, everything has to be much quicker. The impact of people not receiving things very quickly is huge from a customer service perspective for our clients, meaning our SLA is now much later in the day. We’re really hot on it because the last thing you want is an inbox full of people saying, where’s my order?

Erik, Bleckmann: Yes, quite simply, we need to always evolve and adapt in line with the ever changing customer needs and wants. As an example, these days, there is an absolute expectation to be allowed to order mere minutes to midnight and still get an order delivered the very next day. This implies that we need to make sure that we have the right partnerships with carriers and couriers. But it also means we need to amend the resource planning on our side.  So we can’t plan the resources between 9am and 5pm anymore, but you have perhaps 30% of your resources at that time and the rest is between 5pm and midnight, because everybody comes home from work and goes online again.

Dean, Oakland International: We work with some of the major food and recipe D2C brands and it’s been remarkable how well they have stood up in terms of customer retention and growth over the last year considering the cost of living crisis. We are likely to see food prices continue to go up in 2025, and this can play into the hands of the D2C brands as there is no middle-man and so no compound margin taking place – making them better value compared to a standard meal shop.

CARRIER MANAGER at Top 3 UK 3PL: It’s actually the other way for us. It’s us going to clients and almost convincing them that this is where they need to be looking. We’re showing brands that evolving consumer needs are driving the demand for convenience and choice in delivery. It’s less about ultra-fast shipping and more about flexibility—consumers want to choose when and where their orders arrive, whether it’s a drop box, nearby shop, or home. Lots of retailers still assume next-day delivery is the gold standard, but our analysis shows that 21% of customers push back deliveries to fit their schedules. 

Stewart, Sprint: I have to say we are a little tentative about offering up services to retailers which haven’t been specifically requested, just because of being let down and then it being a case of having overpromised. But one thing I’ve been asked about more in the last two months than ever, is do any of your people use electric bikes? Do they use green delivery methods? And I think that comes directly from consumer pressure. So we’ve been engaging carriers like Zedify to meet this demand.

Stewart, Sprint: Also high up on the agenda is pushing back later and later the ability to amend an order after it’s been placed- add something in, change the quantity etc. Which we are doing an amazing job of accommodating, but, at some point, it’s got to be picked! Returns also continue to be a big area where retailers are working with fulfilment houses to meet consumer demand. In some specific categories such as high volume fashion, If you’re sending out 10,000 orders, perhaps 50% of them may come back? That’s a real headache. You need to have grading processes in place, or we’ve done steaming and repairs. All so the retailer has a chance of reselling it and not making a loss.

Erik, Bleckmann: In the past, a brand’s website was the sole origin of its ecommerce sales orders. If that is still your setup, you’re a thing of the past pretty soon. So right now in fulfillment, you need to be able to receive orders from all sorts of platforms: A brand’s own website, a sales platform, but also platforms that look after obsolete stock. And brick and mortar has come back with a vengeance! So you also better be able to deliver products in store. I’m not talking about B2B, but as a B2C delivery in store as a pickup location.

3. How do you think carriers and fulfilment companies could collaborate better?

CARRIER MANAGER at Top 3 UK 3PL: I think one of the things that we need to realize is that we’re all, on a daily basis, shipping fresh air up and down the motorways. I think it’s something along the lines of 70% average trailer fill, which means 30% effectively is just air. If we were to be able to somehow share those resources, work together… I think it probably is going to be legislation that ultimately drives this – I’d like to think it might happen without it but we probably need legislation to get it happening at scale.

David, Wonderpack.eco: This may be a bit of wishful thinking and pie in the sky dream, but these are the two things I think about when it comes to carrier and fulfilment partnerships. One is around wasted space. If we send a truck in and it’s half full, for example, or it’s not optimised sustainably, it’s inefficient, right? HGVs are constantly moving around the country; they are hugely impactful and wasteful if they don’t have full loads.

Stewart, Sprint: I also think there’s a little bit of tension around pick up times. Obviously we want  to have as long as possible to pick and pack, and for the carrier they are trying to manage a mix of client requirements including those with a really late order cut off for a next day service and those that are ready a lot earlier. It means everything gets shunted to much, much later on and when you’ve got peak, Christmas, this can lead to big problems with couriers not headed out to deliver until lunchtime and working till very late in the evening and not managing to deliver everything they needed to that day.

David, Wonderpack.eco: The second thing is that I’m really conscious that we often pass huge numbers of orders to the carrier. They then take it and sort it in these giant hubs. However, if there was pre-sorting, that would benefit everyone, and it could have a tangible and positive impact on emissions.

If we do this properly, we can send one full, pre-sorted van to each side of the country rather than a middle-stage sorting at the hub. I believe there is a real opportunity there, and I think it is something that we will have to move towards as everyone continues to grow and the volumes increase more and more.

Dean, Oakland International: I think there is quite a bit of undercutting going on. Consumers just want a service from carriers which is reliable and they have confidence in- that their items won’t get lobbed over the fence and that the person delivering isn’t eyeing up the property for a robbery! Local knowledge is key. The service provided by carriers that endeavor to use the same drivers each day makes a massive difference.

Erik, Bleckmann: As a carrier or 3PL, you cannot be a mere supplier anymore, sending your invoices twice a month. You really need to have that proper partnership and seamless tech integrations to supply data almost in real time. But also the partnership has to be just that, an actual partnership. I need to be able to pick up a phone and say ‘hey buddy help me and next time I’ll help you’ – it can’t be a line into a generic customer service number, but a proper named person who can make those changes happen. Also from a strategic perspective, to be able to report on, let’s say sustainability, which is becoming a hot topic- especially with upcoming EU legislation from 2027. If I need to ask for those reports one by one, I’ll need an entire team to handle that! So again, we need carrier partners who understand that need and are willing to work with you.

 

4. How well equipped do you think the fulfilment and logistics sector is for the transition to net zero? What do you think needs to happen to improve sustainability in the sector?

David Ramirez, Wonderpack.eco:  It’s easy to say, let’s plant a tree for each delivery, and it’s becoming the de facto way of answering the question ‘Are you sustainable’?

It’s got to be way more than that. Instead of planting trees that we don’t know will survive and absorb carbon, should we invest in supplying communities in developing countries with clean fuel sources instead? And what about closer to home? We must start reimagining vans. Can they become ‘living vans’? If you imagine every van has some sort of solar panel and plants on top of it, I’m not an engineer, so there’s loads more to it than that, but with concepts like that, we haven’t even scratched the surface

Stewart, Sprint: I don’t think that the main players in parcel networks have any real idea how to deal with it and certainly not how to audit it to give you information. Because they just don’t have that level of reporting. The most terrifying hub I think I’ve ever been to is a well-known carrier hub in central London. I mean, they couldn’t tell you what parcel your truck has gone out on and whether it went out on an electric van or a diesel van or what- it’s all just like grab and dig!

CARRIER MANAGER at Top 3 UK 3PL: For us, we’ve got, I think, around about 6,000 tractor units driving up and down the motorway on a daily basis. Switching those to sustainable alternatives: that’s a huge investment, right? And do you choose to go in terms of renewing those vehicles? Do you renew them in alternative fuel sources, in hydrogen, in electric?

The number of registered EVs in the UK has increased by 571% in the last five years, while the number of available public charging points has increased by only 298%. But EV sales currently account for less than 17% of the total vehicle sales in the UK and the government target for 2030 which, bear in mind is less than six years away, is 80% of new cars and 70% of new vans. 

Stewart: Whilst many logistics companies produce some lovely brochures and give you all this wonderful information about their green credentials and what they’re doing and they’re exploring this and they’re developing that and this is on trial. In the cold light of day, it’s a beat up Mercedes transporter van roaring down the M4. It’s really difficult.

Dean, Oakland International: Being a coldchain specialist, the biggest challenge is decarbonising our fleets. We’ve looked into new technologies to reduce emissions from our refrigeration and we now operate 100% of our trailer fleet on Carrier’s Eco-drive unit which converts power from the truck engine into electricity to drive the fridge units. My current view is that hydrogen will be the future for heavy haulage and electric has a strong part to play in last mile deliveries.

Separate from this, we’re a BCorp and are constantly looking at other parts of the business, especially at our hubs to reduce emissions in the short term and we have signed up for an accelerated journey to Net Zero.

David: We’ve got to think about reusable packaging, too. If we think about the lifecycle of a box, we generally use cardboard; that’s our number one choice for several reasons, with sustainability being one of the biggest ones. However, when that cardboard is recycled, it’s often collected and sent offshore, then re-milled and returned as packaging products.

Could we use reusable plastic totes that move around the network instead? That creates efficiencies for carriers because they can rack out all their vans, and they know exactly what is coming, meaning there is less waste of space and fewer damages. I think we must look at it more creatively than simply: how do we get to net zero?

Erik, Bleckmann: Although public and corporate opinion are rapidly shifting in favor of more sustainability in our sector, unfortunately, I have to agree with others that there is an issue with the infrastructure capabilities, for example: electrification of haulage trucks. I’m also pretty sure that this will be the case for at least the next 24, 36 months. However, there are things we can do to work on aspects of the sector that are not affected by this. 

For example, most of our facilities have the capacity to generate more green energy from solar panels than that they consume. You can imagine  those massive warehouse roofs provide untold opportunities to catch as many rays as possible. And we invest in not only harnessing, but also utilizing that energy in an effective manner. All our MHEs are for example electric and charged overnight so that the operations aren’t hindered.

Packaging and the packing process is a massive issue and by working with our brands and suppliers we’ve reduced waste by 85% and much of this is making sure that we don’t ship air.

5. What’s in store for your business in 2025?

Dean, Oakland International: We’ve got some really exciting plans to build a fully integrated food tech campus built around sustainability and utilising our expertise in logistics to support a fully circular business model. The ideas being developed include space and support for new start-up and growth food businesses as well as super low-energy, affordable housing for staff, vertical farming, anaerobic digesters, all with the mission to get fresher produce to small businesses with the least impact on people and planet.

CARRIER MANAGER at Top 3 UK 3PL: For my department, for us as a business, it’s all about growth over the next year. It’s taking the learning, it’s taking the efficiencies that we’ve managed to achieve over the last few years and going out into the market and offering those out to customers that maybe don’t benefit from those at the moment.

Stewart, Sprint Logistics: Well, we’ve opened a new facility in Peterborough. And then lo and behold, we appear to be getting towards having filled it almost straight away! Now we’ve started immediately looking for somewhere additional to allow us further growth. But it needs to be the right type of space because we want to be able to store as much as possible to supply the pick faces. So we’re looking for tall buildings now which have the most capacity for us, whereas in the past it’d almost be, you know, anywhere that you can put racking.

We’re also tweaking and finishing off our own in-house WMS and order management management system, which is about 98% of the way there. So whether it’s Etsy, Amazon, Shopify, their own store, whatever, the new system can bring everything in and manage the whole order flow process and the whole stock flow process side by side, and obviously crosses and shares information where it needs to. Reducing account management time and therefore keeping costs low for our clients.

David, Wonderpack.eco: Well, we’re on an exciting growth journey, and we’re really pushing the accelerator. I expect one more Wonderpack site to be opened next year, and our teams will have another recruitment drive. As we grow, it allows us to look at how we do things and how we’ll do things differently.

We genuinely want to add value, not just be another 3PL that does things the same way; that means brands will simply compare base prices and storage costs. We constantly explore other ways to add value for our clients, even down to the details of developing the most efficient packaging designs.

Erik, Bleckmann: Growth in the UK after Boris’s Brexit has been like nothing we have seen before. Over the last 4 years we have grown from serving 5 clients in just 2 warehouses to managing the operations for over 60 brands across 7 logistic centres.

In terms of automation, sorting, robotics, etc. we’re creating more, what they call ‘dark warehouses’ where you don’t need to turn on the light because there are only robots at work in there. We now have one operation in Belgium, one being completed by the end of January, but by the end of 2025, we’re going to have several of these locations across Europe.

We’re also investing in our CSR strategy with our CSR manager Ron Thijssen- we’re working on a large number of projects and initiatives.This is both as a direct result of a changing public opinion and in preparation of upcoming changes in national, European and British law and regulations. Within this area we want to be the best kid in class. So we don’t mind walking the gauntlet on that one, with, for example, circular economy focused investments to support grading, repair and resale of products that would otherwise be thrown away. These types of solutions positively affect both the environment and our partner-brands profitability. 

6. What do you see as the big opportunities for the sector to evolve over the coming 12 months? What are some of the biggest technological developments that you think will affect the sector next year?

David, Wonderpack.eco:  We’re going to see a lot more robotics. We already use them in their simplest form with our robotic pallet wrappers, and we have them for two reasons. Firstly, they avoid manual handling, which can lead to back pain. Secondly, using robots for this task also ensures continuity in quality and usage, so we know exactly how much plastic we will use on pallet wraps every time.

Of course, another buzzword is AI- I think what we’ll see is routing automation- we’ll see AI saying this is what we expect to see in your data a week in advance and saying, hey, next week, you’re going to have 4,000 orders on this day from this client going to that postcode region. This is the information that’s going to give us that real ability to plan. The final thing is micro-fulfilment centres. I think having micro-fulfilment centres will become normal. But again, some really, really hard work needs to go into studying efficiency and whether it’s genuinely impactful for sustainability.

CARRIER MANAGER at Top 3 UK 3PL: We’re all well aware of chatbots- love them or hate them –  they are here. But what I think a lot of people don’t see is the AI that’s in the background in the call centers, the service driven parts of it. I’m seeing some really interesting things around AI generating responses to email queries. So retailers coming through asking about the status of shipments, for example, and the ability for AI to pick that query out of a help desk or an email, identify that shipment number in one of the linked systems, via a carrier portal or a platform like Metapack, pull the tracking information for it, pull together an email around that tracking information and be able to reply back all fully automated.

Stewart, Sprint: I think there’ll be a lot of consolidation over the next 24 months. I think we’ve started to see it in some instances already with large 3PLs buying up smaller brands. For some of those absolutely massive operations it’s harder to acquire some kinds of customers who might feel they are ‘too big’ to deliver a decent service, that they might get treated like just another number. I’m also very interested to see how Amazon Logistics is going to develop – what are we going to see from them?

Erik, Bleckmann: Spain, Portugal, Italy, Morocco, Algeria, they are now growing in terms of manufacturing. People are getting hesitant to invest a lot of their budget on a yearly basis in production in faraway countries. Again, in this political turmoil, we see that brands invest to get out of China where possible because China is changing. So we see a lot of near-shoring in terms of manufacturing. 

Also, in preparation for changing legislation we are seeing many companies starting to invest in circular solutions, in terms of what to do with an obsolete product. I think by the end of 2027 a brand will not be allowed to discard their products anymore and they will be compelled to report on a product unit level. Every product will need to have a digital ID. So you will have to be able to track where your product is at any given moment. Those piles of discarded products in the deserts of Chile or Africa, that will be a thing of the past hopefully very soon. So next year I expect to see many making preparations for this upcoming change.

CARRIER MANAGER at Top 3 UK 3PL: Interest rates are reducing, consumer spending is starting to come back, a bit of confidence is coming back there. So I think next year is gonna be, fingers crossed, a different year than we’ve had for the past 2,3.

When the economy drops, our sector is just totally focussed on price. We all tighten our belts. And then the cycle starts again, the economy picks up, and it becomes all about service. So I think over the next probably two or three years as the global economy and the markets start to pick up again, I think we’re going to see logistics less driven by what’s the cheapest, less racing to the bottom, and more about what’re the new services that are coming up, you know, who’s giving the best service offering.