DP World’s state-of-the-art logistics park, London Gateway, wants to become the logistics epicentre of the UK food industry. For that, it needs to offer clients what others can’t.
Its proximity to London – around 30 miles – and other south east hubs is an obvious point of attraction. The deep sea port and logistics park is also supported by its own international rail terminal, making it easily accessible.
But as DP World’s park development VP, Oliver Treneman, explains, it’s about more than convenience.
He claims the technology underpinning the integrated logistics system here – which includes warehouses and ripening facilities all in close proximity to the port – is unlike anything seen in the UK.
It allows, say, a supermarket that bought bananas from South America, to control every single stage of the shipping journey, saving it time and money.
Around 50% of all the refrigerated food coming into Britain comes through London Gateway, primarily fresh fruit, but also fresh and frozen meat and seafood. Treneman argues it was always going to be a “powerhouse” among food traders because of its huge scale – with a logistics park equivalent in size to 400 football pitches, it is the biggest of its kind in Europe – and how rapidly they’ve seen volumes increase in the past couple of years.
The fact that produce can be ripened, processed and packaged at the park and then be shipped directly to stores cuts down costs and CO2 emissions when compared with the traditional “dead miles” model of going up to pack houses in the north and then coming back to London, Treneman says.
“The typical route would be from here up to somewhere like Spalding where it’s unpacked, then to a DC, and then maybe back into London – that’s probably a 300-mile round trip, how does that make sense?”
It also reduces the chances for food waste, he notes. “We improve the longevity of your shelf life significantly, so if you’re able to ripen here and go direct to store, it follows that your produce is going to be three days fresher than anything else.”
Fresh produce capacity has increased by around 50% this year, meaning around three million units will circulate through the park in 2023. “If you already factor in how much of our business is fresh, there will be a lot more fruit & veg coming through this facility through in the not-too-distant future.”
He also says that having a logistics park that handles all the different aspects of the supply chain allows London Gateway to offer supermarkets “greater visibility as to where your stock is”. “If someone goes into Tesco and orders a bag of bananas, in the cash register they’ll say ‘we need to replenish the stock’ – so if you can do it quickly and from a location where you know exactly where your bananas are located in that part of the journey, then you have visibility and you deliver a better service and a fresher product to your customers.”
Carbon emissions reduction is also a major point of sale for supply chain businesses as the race to net zero intensifies and companies look to cut down their footprint wherever possible.
This year, London Gateway invested £12m in the first all-electric fleet of straddle carriers to go into commercial operation at a port anywhere in the world. It is also looking “very closely at a much wider solar energy strategy” which will include converting the roofs of all the new warehouses to solar panels, Treneman says.
It is worth noting that most of the volumes that come through the port (around 90%) are not coming from the EU but rather the rest of the world. But the port & logistics hub is also looking to rake in customers in the post-Brexit environment who would otherwise opt for ports like Dover or Southampton as there might be more “sensitivity” around those because of incoming border checks and potential delays, Treneman adds.
The efforts are paying off – recently, DP World’s logistics arm welcomed five new customers at its latest facility at London Gateway in the first 100 days of operation, following surging demand for warehousing space near the capital.
The “remarkable level of interest” at the multi-user warehouse stemmed from businesses in the fmcg, manufacturing and industrial sectors, the company said.
And with food companies looking to ramp up efficiencies and lower their costs after three years of financial pressures, it looks like DP World’s London Gateway growth trend is only set to continue.