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Transportation and Shipping / REPORT INFORMATION

Freight Forwarding

DateDec, 2006
Pages123
Price / format$756 / Online Download

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Abstract:
Key Note estimates that, in 2005, the UK international freight-services market was worth around £19.76bn, of which £15.43bn was attributable to freight forwarding. Freight forwarding is defined to include related warehousing, storage and customs-clearance activity. It supports the international freight-services market, which includes international freight transport operations by road, air, sea and rail. Largely because of improvements in transport efficiency, demand for such freight services has increased less than proportionately to growth in gross domestic product (GDP). However, over the 5-year review period (2001 to 2005), growth experienced by the freight-forwarding sector exceeded growth in the freight-transport sector as a whole.

Recent influences supporting the growth of the freight-forwarding sector have included the trend towards outsourcing of non-core business activities by many firms across the commercial spectrum, the growing complexity of regulation affecting international trading relationships, and an increasing awareness of security considerations. All of these factors have made it more beneficial for clients to use the services of a professional forwarder, but other developments, which have reduced the regulatory burden on shippers and transport operators alike, have lessened the benefits of using these specialists. Noteworthy among these has been the progressive deregulation of transport markets within and between the member countries of the EU, with the dismantling of customs barriers between member countries removing the need for many of the specialist services formerly provided by the freight forwarder.

Other influences affecting the sector in the recent past have included the need to comply with many onerous regulations, including those concerning terms and conditions of employment, which have had a disproportionate impact on the many smaller freight forwarders operating in the sector.

Road transport remains the dominant mode for international freight transport, but sea freight showed the highest growth over the review period, with receipts from cross trades showing a particularly large increase. Although the share of air freight is small in terms of tonnage carried, it represents a much higher share in terms of the value of items carried and the service provided. The international rail-freight sector performed well below its potential over the period, largely as a result of disruption to services caused by asylum seekers at the SNCF-operated rail-freight terminal near Calais in 2002 and continuing issues regarding the quality of service to clients.

Independent forecasts of the development of the UK economy indicate that it will continue to experience steady if modest economic growth over the period to 2010, with inflation and unemployment continuing at relatively low levels. This, together with further market globalisation, an increased awareness of security and environmental issues, and the continuing development of IT applications to enhance the value of the freight-forwarding product, suggest a favourable environment for the continued growth of the sector.


Table of contents:

Executive Summary

1. Market Definition

REPORT COVERAGE

MARKET SECTORS

Freight Forwarding

Transport Principals

International Road Transport

International Sea Transport

International Air Transport

International Rail Transport

MARKET TRENDS

Globalisation

Market Liberalisation

Changing Customer Needs

ECONOMIC TRENDS

Population

Table 1: UK Resident Population Estimates by Sex (000), Mid-Years 2001-2005

Gross Domestic Product

Table 2: UK Gross Domestic Product at Current and Annual Prices (£m), 2001-2005

Inflation

Table 3: UK Rate of Inflation (%), 2001-2005

Unemployment

Table 4: Actual Number of Unemployed Persons in the UK (million), 2001-2005

Household Disposable Income

Table 5: UK Household Disposable Income Per Capita (£), 2001-2005

MARKET POSITION

The UK

Table 6: UK Freight Forwarding Services as Part of the UK Transport, Storage and Communications Sector by Value at Current Prices (£m and %), 2001-2005

Overseas

2. Market Size

THE TOTAL MARKET

Table 7: The Total UK Market for International Freight Services by Sector by Value at Current Prices (£m), 2001-2005

Figure 1: The Total UK Market for International Freight Services by Sector by Value at Current Prices (£m), 2001-2005

Table 8: The Total UK Market for International Freight Services by Value at Current and Constant 2000 Prices (£m and index 2000=100), 2001-2005

BY MARKET SECTOR

Freight Forwarding

Table 9: The UK Freight Forwarding Sector by Value at Current Prices (£m and %), 2001-2005

Transport Principals

International Road Freight

Table 10: The UK International Road Freight Sector by Value at Current Prices (£m and %), 2001-2005

International Sea Freight

Table 11: The UK International Sea Freight Sector by Value at Current Prices (£m and %), 2001-2005

International Air Freight

Table 12: The UK International Air Freight Sector by Value at Current Prices (£m and %), 2001-2005

International Rail Freight

Table 13: The UK International Rail Freight Sector by Value at Current Prices (£m and %), 2001-2005

International Trade

Table 14: UK International Trade in Goods by Value (£m), 2001-2005

3. Industry Background

RECENT HISTORY

Transport Liberalisation

CURRENT INDUSTRY STRUCTURE

NUMBER OF COMPANIES

Table 15: Number of UK VAT-Based Enterprises in the Freight Forwarding and Other Transport Agencies Sector by Turnover Sizeband (number and %), 2006

Table 16: Number of UK VAT-Based Enterprises in the Freight Forwarding and Other Transport Agencies Sector by Turnover Sizeband, 2001-2005

EMPLOYMENT

Table 17: Number of Employee Jobs in the Supporting Transport Activities Sector in Great Britain (000), September 2001-2005

REGIONAL VARIATIONS IN THE MARKETPLACE

Table 18: Number of UK VAT-Based Transport Enterprises† by Employment Sizeband and Population Distribution by UK Region (number and %), 2005

HOW ROBUST IS THE MARKET?

LEGISLATION

Insurance Mediation Directive

UK-US Extradition Treaty

Employment Legislation

Safety Legislation

KEY TRADE ASSOCIATIONS

British International Freight Association (BIFA)

European Association for Forwarding, Transport, Logistics and Customs Services

Freight Transport Association

International Federation of Freight Forwarders Associations

Other Trade Associations and Professional Bodies

4. Competitor Analysis

THE MARKETPLACE

MARKET LEADERS

Table 19: The Top Ten Companies in the UK Freight Forwarding Market by Turnover (£m and %), 2004

Allport Ltd

Company Structure

Current and Future Developments

Financial Results

DHL Global Forwarding (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

EGL Eagle Global Logistics (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Exel Freight Management (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

GeoLogistics Ltd

Company Structure

Current and Future Developments

Financial Results

Kamino Logistics Group Ltd

Company Structure

Current and Future Developments

Financial Results

Kuehne + Nagel (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Nippon Express (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Panalpina World Transport Ltd

Company Structure

Current and Future Developments

Financial Results

UPS SCS (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Other Companies

OUTSIDE SUPPLIERS

Suppliers to the Transport Sector

Fuel Suppliers

Vehicle Suppliers

Suppliers of Equipment and Engineering Services

Suppliers to the Ancillary Transport Services Sector

Table 20: Suppliers to the Transport Sector (% of total output), 2004

MARKETING ACTIVITY

5. Strengths, Weaknesses, Opportunities and Threats

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

6. Buying Behaviour

CUSTOMER CHARACTERISTICS

PURCHASING SECTORS

Table 21: Purchasers of the Output of the Transport Sector (% of total output), 2004

7. Current Issues

ROLE OF THE FORWARDER

LEGISLATIVE AND REGULATORY ISSUES

Insurance Legislation

Employment Legislation

The Employment Act 2002

Minimum Wage Legislation

Road Transport Directive

The Employment Equality (Age) Regulations 2006

Safety Legislation

EU Policies

Competition Policy

UK-US Extradition Treaty

THE ENVIRONMENT

Sustainable Mobility

Emissions Trading

TECHNICAL ISSUES

Technical Responses To Environmental Concerns

Importance of the Internet to Forwarders

Freight Management Systems

CORPORATE ACTIVITY

Kuehne + Nagel

Panalpina

Allport

8. The Global Market

GLOBAL MARKET BACKGROUND

Trends in World Trade

Table 22: World Exports of Merchandise and Commercial Services by Value ($bn), 2003-2005

Regional Trade

Table 23: GDP and Merchandise Trade by Global Region (annual % change at constant prices), 2004 and 2005

Influence of Natural Disasters on International Trade

Influence of Terrorist Acts

FREIGHT FORWARDING SECTOR

Background

Segmentation by Mode of Transport

Air Freight

Table 24: Market Shares of Global Air Freight by Value (%), 2004

Ocean Freight

Table 25: Market Shares of Global Ocean Freight by Volume (%), 2004

Other Transport Modes

Constraints on International Trade

THE FUTURE

Removal of Barriers to International Trade

General Agreement on Trade in Services

EU Transport Policy

9. Forecasts

INTRODUCTION

Demographics

Table 26: Forecast UK Resident Population by Sex (000), Mid-Years 2006-2010

Economic and Social Background

Table 27: Forecast UK Economic Indicators (% and million), 2006-2010

FORECASTS 2006 TO 2010

International Freight Services

Table 28: The Forecast UK Market for International Freight Services by Value at Current and Constant 2000 Prices (£m and index 2000=100), 2006-2010

Figure 2: The Total UK Market for International Freight Services by Sector by Value at Current Prices (£m), 2006-2010

Freight Forwarding

Table 29: The Forecast UK Freight Forwarding Market by Value at Current Prices (£m), 2006-2010

Transport Principals

Table 30: The Forecast UK International Freight Transport Sectors by Value at Current Prices (£m), 2006-2010

International Road Freight

International Sea Freight

International Air Freight

International Rail Freight

MARKET GROWTH

Figure 3: Growth in the UK Market for International Freight Services by Value at Current Prices (£m), 2001-2010

FUTURE TRENDS

Globalisation

Competition Prospects

An Enhanced Role for the Forwarder?

Environmental Concerns

Security

Other Developments

10. Company Profiles

Allport Ltd

DHL Global Forwarding (UK) Ltd

Exel Freight Management (UK) Ltd

GeoLogistics Ltd

Kamino Logistics Group Ltd

Kuehne + Nagel (UK) Ltd

Panalpina World Transport Ltd

UPS SCS (UK) Ltd

11. Consumer Confidence

METHODOLOGY

KEY FINDINGS THIS QUARTER

THE WILLINGNESS TO BORROW

Confidence Rebounds

Table A: The Average Amount Consumers Are Willing to Borrow in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), August 2005-2006

Fewer Adults Wish to Borrow

Table B: The Number of Adults Willing to Borrow in Order to Purchase Expensive Items (000 and %), August 2005-2006

SPENDING FROM SAVINGS

Strong Recovery in Spending from Savings

Table C: The Average Amount Consumers Are Willing to Spend from Savings in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), August 2005-2006

Savings Grow in Relative Importance

Table D: The Average Amounts Adults Are Confident Spending to Purchase Expensive Items (£ and %), August 2005-2006

12. Further Sources

Associations

Government Publications

Other Sources

Bisnode Sources





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