Economic Update 1st February 2012
Haulage will be hit in 2012 says Bank
The haulage industry has been picked out as a sector with acute overcapacity where consolidation amongst operators is likely.
The Bank of England’s regional agent’s summary of business conditions predicts that having already pared back non-labour costs as much as possible during the recession, many businesses will now think they have no option but to reduce staff numbers.
The report also says that smaller companies are continuing to be wary of approaching banks for finance fearing “re-pricing of existing facilities, or requests for increased security against lending, such as personal guarantees.”
The Olympics may also have negative effect on business spending, as some large road, rail, energy and water projects are likely to “go into abeyance for several months of the Olympics”. As an example, Crossrail has said that work will stop at its closest site to the Olympics, Pudding Mill Lane, between May and September.
Additionally, temporary equipment shortages, related to Olympics demand, and non-availability of police means that some projects and events like the Glastonbury Festival will not go ahead.
Late payments blasted
Record numbers of businesses are paying suppliers late in what the Institute of Credit Management has called an “epidemic”.
On average it took 25.6 working days more than the agreed payment date (usually between 30 and 90 days), for bills in 2011 to be settled, according to figures from the Institute.
This shows a worsening trend from the 22.5 day average in 2010 and the 21.5 day figure in 2008.
At an average of 34 days late large companies are the worst offenders, although smaller businesses were between 20 and 22 days overdue on average.
The Institute has asked the government to make businesses abide by late payment codes, of practice.
The RHA is campaign against the late payments culture plaguing many members.
Automatic pensions enrolment dates put back
The dates when SMEs have to enrol all employees in a company pension scheme have been put back to allay fears that the requirement may impose undue burdens on businesses in the current difficult economic climate.
Now employers with 50 to 249 employees will have to enrol staff between April 2014 and April 2015.
Where a business has fewer than 50 employees, staff will have be enrolled between June 2015 and April 2017.
The largest enterprises have to start the process from October this year.
EU hauliers fear cost of fuel efficiency improvements
52% of European hauliers think that their fleets are unlikely to achieve CO2 reductions of more that 10%, despite the EU target of making 20% savings by 2020. The findings come from a survey of European transport managers conducted by Goodyear Dunlop.
One-in-seven respondents thought they could go bust within eight years unless something is done to improve fuel efficiency.
RHA chief executive Geoff Dunning said "Consignees need to respect the whole supply chain, but operators need to manage their business efficiently. Regulations need to give incentives for improvements."