Britain’s transport and storage sector is heading towards the crucial Christmas trading period under pressure, with one in three businesses reporting a fall in turnover during August.
Some 33.7% of transport and storage firms said turnover fell compared with July, according to analysis of the latest Office for National Statistics Business Insights and Conditions Survey by delivery specialist Parcelhero.
That was more than double the 13.8% reporting a decline a month earlier.
Only 2.7% of businesses in the sector, which includes couriers, hauliers and warehousing firms, reported an increase in turnover. That was down sharply from 15.2% in July.
The performance was weaker than the wider business economy, where 28.3% of firms reported declining turnover and 11.9% recorded growth.
Manufacturing proved more resilient, despite 27.5% of firms reporting lower turnover. Some 25.8% reported growth, up from 15.4% in July.
Within wholesale and retail, 31.4% of businesses recorded falling turnover while 11.7% saw an increase.
David Jinks, head of consumer research at Parcelhero, said the deterioration in transport and storage had been particularly marked.
“Barely one in 36 firms saw turnover grow in August, while one in three saw it fall,” he said.
“Manufacturers, by contrast, are showing real signs of life, with more than a quarter reporting growth.”
Competition was the most frequently cited challenge among transport and storage businesses, mentioned by 18.8% of respondents.
Economic uncertainty followed at 17.3%, while 13.5% pointed to material costs.
Insufficient domestic demand was cited by 11.7%, a sharp increase from 2.1% in the previous survey.
Jinks said the increase in businesses reporting weak demand could suggest fewer goods are moving through the logistics network.
“The jump in firms citing weak domestic demand suggests the problem is fewer parcels and pallets moving, rather than costs spiralling,” he said.
“That is arguably harder to fix.”
Manufacturers reported a different mix of pressures, with 42.7% citing material costs and 33.9% pointing to economic uncertainty.
Among wholesale and retail firms, 33.9% cited economic uncertainty, 27.6% material costs and 27.3% competition.
Expectations for October also remain subdued across transport and storage.
Only 6.1% of businesses expect turnover to increase, although that is slightly higher than the 4.6% recorded previously.
Some 16.4% expect turnover to fall, up from 11.3%, while 28.6% are unsure about the direction of business.
The proportion expecting no change has fallen from 62.8% to 48.9%.
Manufacturers are more optimistic, with 23.5% expecting growth in October and 19.3% anticipating a decline.
In wholesale and retail, 14% expect turnover to rise and 16.6% expect a fall, while 56.1% anticipate little change.
The figures also show a sharp deterioration in the net balance for transport and storage, calculated as the proportion reporting growth minus those reporting a decline.
The sector moved from a positive balance of 1.4 percentage points in July to minus 31 in August, a 32.4-point swing.
Manufacturing improved from minus 10.3 to minus 1.7, while wholesale and retail weakened from minus 7.5 to minus 19.7.
Across all businesses, the August net balance stood at minus 16.4.
Looking ahead to October, the transport and storage balance stands at minus 10.3, compared with minus 6.7 for September.
Manufacturing remains positive at 4.2, while wholesale and retail has improved to minus 2.6.
Jinks warned that the figures come at a critical point in the calendar for logistics companies as retailers prepare for Black Friday and Christmas.
“October should be the start of the run-in to peak, yet fewer than one in 16 transport & storage businesses expect growth and more than a quarter can't call it,” he said.
“With Black Friday and the Christmas rush approaching, the sector needs demand to arrive quickly.”
Parcelhero said the longer-term prospects for logistics remain more positive, pointing to greater use of technology and the continued development of e-commerce.
The company has also published its Delivering the Future report examining how ordering, deliveries and e-commerce could develop towards 2030 and beyond.