The findings come from a survey of more than 1,000 senior supply chain, transport and logistics decision-makers and managers at UK companies. Most respondents worked for businesses with annual turnover above £100 million, although companies with turnover of £50–99 million were also included where their annual logistics spend exceeded £10 million. The research was conducted by Censuswide.
According to the report, 33% of respondents said transport inefficiencies had resulted in lost customers or market share, while 41% reported increased costs as a result of operational inefficiencies.
The commercial consequences extend beyond direct cost increases. Around a quarter of respondents said logistical problems had resulted in penalties linked to contractual obligations, while more than one in five reported damage to their reputation. Just under a quarter said logistics problems had prevented their business from fully capitalising on important sales periods such as Christmas.
The findings come as companies prepare for further pressure on transport budgets. Eighty-nine per cent expect logistics operating costs to increase during the next 12 months, with 37% anticipating a significant rise. More than half – 52% – agreed that logistics decisions within their organisation are driven purely by cost.
Expectations differ slightly between sectors. Some of the highest proportions predicting higher transport costs were recorded among respondents in FMCG and fashion and apparel, both at 96%, followed by healthcare at 95% and defence and aerospace at 93%.
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Investment in fleet optimisation is rising
Businesses are responding by putting more money into fleet optimisation.
GXO’s survey found that 85% of organisations had increased investment in fleet optimisation during the previous year, with 35% saying investment had increased significantly.
Improved delivery performance was the most commonly cited benefit, selected by 42% of respondents. This was followed by improved customer experience at 37%, greater visibility of operations at 36%, improved driver productivity at 35%, and better data for decision-making and regulatory compliance, also at 35%.
However, the report argues that increased spending is not necessarily translating into consistent returns. GXO says around half of organisations are not yet seeing consistent or measurable benefits, partly because individual measures such as routing systems, fleet upgrades or driver-performance programmes are often introduced separately rather than as part of an overall optimisation strategy.
Technology integration emerged as the most frequently cited obstacle to further fleet optimisation, mentioned by 44% of respondents. Budget constraints followed at 41%, while 40% identified internal resistance to change.
Other barriers included distrust of new technology, cited by 35%, lack of in-house expertise at 33%, and uncertainty over return on investment at 29%.
The problems vary considerably between industries. In retail, 58% identified technology integration as a barrier, while nearly half also reported insufficient in-house expertise. Among packaging and manufacturing companies, 59% cited technology integration, compared with 34% pointing to budget constraints.
Lack of technology linked to longer deliveries and higher costs
The survey also asked businesses about the consequences of operating without effective transport optimisation technology.
Some 37% associated inadequate optimisation technology with higher maintenance costs, while 32% linked it with longer delivery times and the same proportion with higher CO₂ emissions. Twenty-seven per cent said logistics managers had to spend more time managing operations, while 26% reported a need for larger planning teams.
GXO argues that greater use of real-time data, dynamic route and load optimisation and connected transport systems could help businesses improve fleet utilisation and reduce unnecessary mileage.
Carl Hanson, managing director of transport at GXO UK and Ireland, said companies that can quantify inefficiency and connect it directly with financial and operational outcomes will be in a stronger position to secure investment and improve performance.
The report is the first in GXO’s three-part Future of Transport series. While the survey was independently conducted by Censuswide, the report was commissioned by GXO, which provides managed transport, fleet and logistics optimisation services in the UK and Ireland.
