The warning is not that lean logistics has failed. By reducing inventory and making better use of warehouse capacity, companies have lowered costs and avoided tying up capital in stock and buildings. The problem, according to supply chain consultancy SCALA, is that some networks may now have so little redundancy that even a relatively local disruption could quickly become a serious operational problem.
Its report, The Resilience Gap: Assessing the Risks and Readiness of Global Supply Chains, found that 52% of surveyed businesses held contingency or safety stock amounting to less than 25%. At the same time, 71% said they could increase their UK warehousing capacity by no more than a quarter.
The two findings are closely connected. Low inventories make businesses more dependent on frequent, predictable deliveries. Limited spare warehouse capacity then leaves them with few options to build up stock or redirect goods when those deliveries are interrupted.
What happens if the main warehouse closes?
The clearest example of this vulnerability concerns warehouse continuity. Some 43% of respondents said that if their primary warehouse became unavailable, none of their other sites could take over its dispatches. In addition, 38% operated only one warehouse in the UK, while 52% held fewer than a quarter of their stock-keeping units at more than one location.
That does not necessarily mean that all these businesses would immediately stop trading if a warehouse closed. Some may be able to use a third-party logistics provider, transfer stock from overseas or establish a temporary operation elsewhere. However, those options take time to arrange. If alternative capacity, transport and IT connections have not been agreed and tested in advance, a company could find that its contingency plan works on paper but cannot be activated quickly enough in practice.
SCALA’s findings indicate that this gap between planning and genuine preparedness remains substantial. Only 33% of respondents said they had fully implemented strategies giving them the capabilities needed to respond adequately to disruption. Another 52% had begun but only partially implemented their plans, while 14% had not started.
Identifying an alternative warehouse is not the same as knowing whether it has sufficient space, compatible systems, trained staff and enough transport capacity to handle the additional volume. Similarly, listing a second supplier offers little protection if that supplier depends on the same port, production region or raw materials as the first.
Digital failures could stop orders before lorries move
Physical capacity is only one part of the problem. Modern supply chains also depend on warehouse management, purchasing, order-processing and transport-planning systems. Although two-thirds of the businesses surveyed said their warehouse operations could continue to some extent on backup systems, 14% said they could not. More strikingly, 57% said they would be unable to continue processing sales orders or purchases if their main system failed.
That means a cyberattack or systems outage could prevent goods from moving even when the stock, warehouse and vehicles remain available. Recent attacks on retailers and logistics businesses have demonstrated how quickly a digital failure can affect physical operations, from receiving orders to picking loads and issuing delivery documents.
SCALA therefore argues that resilience planning must cover the whole chain rather than concentrate on one obvious threat. A business may be prepared for a delayed shipment but not for a warehouse fire, energy interruption or loss of its ordering system. It may have alternative suppliers but no alternative dispatch point.
The exposure also extends beyond individual facilities. Nearly half of respondents generated more than half of their sales from their three largest customers. A prolonged service failure could therefore threaten not only day-to-day operations but a substantial part of the company’s revenue.
Efficiency has removed some of the safety margin
The report reflects a longstanding tension in logistics. Spare warehouse space, duplicated inventory and backup transport arrangements all carry a visible cost. Their value may become apparent only when something goes wrong. During periods of stable supply, these resources can appear inefficient. Businesses therefore face strong pressure to consolidate stock, maximise warehouse utilisation and remove unused capacity. Higher property and business-rate costs may reinforce that trend.
But the savings achieved during normal operations have to be balanced against the possible cost of disruption. Extreme weather can affect harvests and transport infrastructure, geopolitical conflict can close shipping routes, labour shortages can reduce available capacity, and a cyber incident can disable several parts of a supply chain at once.
SCALA is not calling for businesses to abandon lean logistics or fill warehouses indiscriminately. Instead, it recommends matching contingency stock and spare capacity to the risks surrounding particular products, suppliers and customers.
Possible measures include spreading critical products across more than one site, establishing flexible arrangements with third-party warehouse operators and ensuring that transport capacity can be redirected. Companies should also test how quickly goods, vehicles and employees could actually be moved, rather than assuming that alternatives will be available when required.
Read more: More sheds, more lorries: UK warehouse growth puts HGV operating centres in the spotlight
A food security issue, not only a business problem
SCALA believes the findings also raise a wider policy question, particularly for food supply chains. Warehouses and lorries are sometimes treated as supporting services rather than essential parts of national resilience. Yet producing sufficient food does not guarantee food security if it cannot be stored, transported and delivered to shops.
The UK Government’s own assessment of food supply-chain resilience recognises that the system depends on an interconnected network covering production, manufacturing, storage, transport, wholesale and retail.
SCALA is consequently calling for warehousing and transport to be recognised as critical national infrastructure. It also wants business rates to support investment in resilient logistics capacity rather than encouraging companies to operate with the smallest possible physical footprint.
“Any national food resilience plan must consider how food will be stored and moved, as well as how it will be produced,” said Chris Clowes, executive director at SCALA.
The findings should nevertheless be treated as an indication rather than a comprehensive measurement of the entire UK market. The research was based on a relatively small survey of 21 senior supply chain leaders, conducted in July 2025. Their companies had combined annual turnover of more than £8.43 billion and operated across grocery and FMCG, electronics, home appliances, furnishings and DIY.
Even with that limitation, the results expose an important question for logistics leaders: whether their networks are genuinely resilient, or have simply managed to cope with every disruption so far.
