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FTA Ireland CEO says hauliers are grappling with cost management and delayed payments

The CEO of Freight Transport Association Ireland (FTA), Aidan Flynn, has addressed the challenges facing Ireland's freight distribution and logistics sector. In a recent write up published in the Irish Examiner, Flynn pointed out key issues affecting the industry and outlined potential solutions.

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One of the primary concerns Flynn raised is the need to decarbonize the sector. He notes that the past year has been marked by efforts to address increasing operational costs, maintain competitiveness, and grapple with skills and driver shortages.

Flynn adds that inflation might be showing some signs of easing, but the cost of manufacturing and distributing goods continues to put pressure on the entire supply chain.

In his text, Flynn refers to the FTA Ireland Managers’ Guide to Distribution Costs Report, which identified several crucial trends, such as the fact that haulage rates are not keeping pace with other business expenses. This situation, it is argued, leaves haulers with insufficient capital to invest in the latest technologies.

Flynn also pointed out that vehicle supply issues and uncertainty about which alternative fuels to commit to have hindered the acquisition of new vehicles. Flynn says this challenge could slow down Ireland’s journey toward achieving a net-zero economy.

According to the FTA CEO, demand for freight is projected to surge by over 90% in the coming years, with Ireland’s population also expected to significantly increase.

In light of these challenges, Flynn stresses that managing costs should be the top priority for all firms in Ireland’s supply chains. He emphasises the importance of managing cash flow to navigate an increasingly volatile marketplace, especially considering delayed client payments are causing cash flow problems for 43% of FTA respondents.

Moreover, the CEO underscores the complexity of supply chains, which extend beyond the capabilities of individual organizations, stating that significant effort is needed to build and maintain a robust supply chain network. In his view, ensuring the stability and viability of all links during times of high operational and energy costs is essential.

Another key point Flynn highlights is the need to review business costs more regularly, collaborate with partners and stakeholders, and assess every aspect of the supply chain to offset additional costs with increased operational efficiency, productivity, and income streams.

Finally, Flynn calls on the Irish Government to provide clarity on preferred fuels and expedite the establishment of a nationwide refueling network. This, he believes, shall facilitate a smooth transition to sustainable options while also making Ireland’s supply chains more resilient.