Truck and Track Autumn 2023

Truck and Track Autumn 2023 48 PALLET NETWORKS Key points include: ■ More predictable volumes return after volatility of COVID years ■ Half year results show strong gains on 2019, but lower volumes than 2022 ■ Overall demand shows remarkable resilience to inflationary pressure ■ Slight reduction in quarter pallets could suggest cost-of-living pressures on B2C ■ 2023 shaping up as sixth consecutive year with significant reduction in injuries at all Hubs Following the fluctuations and high peaks in demand in 2021 and 2022, the 2023 half year results from the Association of Pallet Networks (APN) reveal a more stable, predictable volume pattern, albeit with significantly higher volumes than 2019. To the end of June 2023, volumes were 6.3% higher than 2019 pre-pandemic levels, but 3.2% lower than the first half of 2022. Total pallet volumes for Q2 2023 were 3.2% lower than the same period in 2022. Customers’ choice of preferred service suggests a resilience to inflation. Premium services, including next day and timed deliveries, grew by 5% in Q2 2023 over Q1, although still 3.5% lower than Q2 2022. Economy volumes for Q2 2023, conversely, grew by only 0.9% against Q1, with a reduction of 2.8% from Q2 2022. Premium services, account for 61.2% of the total volume, and economy 38.8% - the proportion of next day deliveries is 0.7% down on 2022. However, overall in 2023, it appears that the popularity of next-day services is resurging. “Despite the focus on rising prices in 2023, it is clear that freight customers and their end users value premium delivery services,” says APN chairman Paul Sanders. “In particular, it is worth noting that half of all B2C deliveries are choosing a next day service.” Home delivery continues to establish itself as a substantial part of the sector’s offering. 17.3% of all pallets in the first six months of 2023 were delivered to residential addresses (B2C), an increase from the 15.9% seen in 2022. For quarter pallets, this rises to 19.5%. 50.9% of B2C pallets are delivered on an economy service; and 56.7% of quarter pallets use a Next Day service. Pallet sizes Although volumes over all pallet sizes were lower than in 2022, the changes in full, half and quarter pallets reveal differing sensitivities to inflationary pressures. Half year figures show full pallet volumes are still 6.5% higher than in 2019, and half pallets 4.5% higher. However, quarter pallets, which are closely associated with the B2C market, declined by 3.3%. In 2022, quarter pallets accounted for 56.9% of all next-day B2C pallets, and 19.5% of quarter pallets delivered to date in 2023 are to residential addresses. Safety gains The APN on behalf of its member networks, produces and promotes health and safety resources and messaging to promote, alongside the work of its health and safety forum. Its aim is to educate employees and thereby drive down injury rates. Across all networks there was a 15.2% reduction in accidents this year, with an average of 0.4 accidents per 100,000 pallets delivered. If this is maintained through Q3 and Q4 2023, this year will become the sixth consecutive year in which injury incidents have been reduced. Key metrics Trunk capacity utilisation increased in the first half of 2023 to an average 78.7%, from 72% in 2022. This represents a substantial contribution to lowering the sector’s carbon emissions. Service levels have remained stable – and high – at 96.6% on-time, in-full and intact delivery to date in 2023. The average weight per pallet handled fell slightly across the membership in the period to 367kg per pallet. This is consistent with the small but marked annual decline in average weights over the past few years. Paul Sanders, Chairman of the Association of Pallet Networks Pallet Network sector continues to stabilise, with sustainable growth in Q2 TRUCK & TRAILER SOLUTIONS WELCOME TOALLPORTS GROUP