UK logistics companies can't compete without modern systems

UK logistics operators face unprecedented pressures. Rising labor costs and elevated energy prices are shrinking company margins. At the same time, shifting tariff regimes and post-Brexit compliance requirements create a time-consuming administrative burden.

For most logistics companies, navigating these complexities remains a significant challenge. Outdated systems, fragmented data, and manual processes make it near-impossible to spot cost-saving opportunities, streamline workflows, and manage the additional documentation now required for trade.

To stay competitive and lift profitability, logistics leaders must adopt modern solutions. And to deploy them at speed — without compromising continuity — they need AI.

The compounding challenges for UK logistics companies

The ground has shifted for UK logistics companies. Rather than focusing on competitive advancement, they now spend considerable time and effort on defending profitability and navigating a volatile regulatory landscape.

Increasing operational expenses

Costs are rising on multiple front for UK logistics companies. Labor shortages are driving up wages for HGV drivers and warehouse operatives. High diesel duties inflate fuel costs. Policy levies mean warehouse lighting, refrigeration, and material-handling equipment are becoming increasingly expensive, especially for temperature-controlled facilities.

And passing these costs to customers is rarely an option. Intense competition and long-term contracts with fixed pricing force many logistics companies to absorb them — eroding already slim margins. 

Unpredictable tariffs

Tariff schedules are changing rapidly across inbound and outbound trade. US duties on key commodities and baseline UK import rates are frequently revised, complicating duty liability and landed costs. Logistics companies must consistently recalculate routes, verify commodity classifications, and adjust lead times — often on tight deadlines to meet tariff implementation dates.

These shifts not only increase operational costs but also divert resources from strategic initiatives that can strengthen their competitive position — such as optimizing supply chains and improving delivery reliability. 

Post-Brexit operational complexity

Post-Brexit customs requirements need careful monitoring and management. Entry Summary Declarations (ENS), health certificates for sanitary and phytosanitary (SPS) goods, and rules-of-origin documentation are mandatory for EU trade. Logistics operators are responsible for coordinating these submissions, often on behalf of multiple clients.

Missing or inaccurate documents trigger penalties and border holds — delaying operations and undermining customer trust.

Modernization and sustainable growth go hand in hand

These pressures stack the deck against logistics companies — and operational inefficiencies make it even harder to boost their market positioning. 

That’s where AI-powered modernization comes in. By embracing new technology, logistics teams can ensure compliance, protect profitability, and free resources for growth-generating initiatives.

Unified data platforms

To reduce costs and navigate evolving tariff schedules, logistics companies must analyze a wide range of variables, such as route data, mileage per vehicle, tariff rates, and origin declarations. What makes it complicated is that all of this data lives in separate systems.

Modern AI-powered platforms use robust API integrations to unify all siloed data into a single dashboard. Logistics teams gain comprehensive visibility without interrupting day-to-day processes. As a result, they spot inefficiencies that drive up costs and complicate tariff-based operational planning.

For instance, by combining commodity classification data with tariff rate schedules and customer order data, logistics companies can reroute shipments to avoid tariff spikes.

Streamlined processes

Optimizing daily operations is key to streamlining costs and customs compliance. Yet, most logistics processes — like load planning and dock scheduling — still rely on phone calls and manual spreadsheets.

Off-the-shelf solutions are designed for generic use cases, not logistics-specific workflows and systems. But AI-powered platforms map granular operational workflows to create solutions tailored to a company’s unique delivery requirements and constraints.

Powered by intelligent automation and centralized interfaces, these cutting-edge tools transform manual, disconnected workflows into well-oiled, automated processes. Instead of teams sorting through paperwork or toggling between files, unified platforms manage the full operational cycle — coordinating routes, tracking deliveries, and capturing Rules of Origin documentation with ease.

The upshot is seamless pre-lodgement submissions and less busywork that consumes valuable resources. For instance, with reliable shipment and inventory tracking, logistics companies minimize costly emergency recoveries and improve service consistency.

Intelligent scenario planning

Logistics companies are uniquely exposed to external shocks. Everything from new regulations and driver shortages to geopolitical conflicts triggers reactive operations that create unpredictable costs. But most core operations still run on legacy systems, which are too slow and rigid to handle rapid pivots or enable strategic planning. 

Traditional IT consultancies often spend six to twelve months drafting a proposal for custom software that can address these limitations. In comparison, AI shrinks production cycles to months, building applications that can analyze multiple variables in seconds. 

Crisis response becomes faster and more optimized, avoiding expensive disruptions. Logistics teams can map out practical solutions for complex scenarios, from fuel price spikes to new tariff rates. The same capability extends to long-term planning, enabling informed investments that minimize costs.

Cogna turns emissions targets into operational reality

Cogna’s AI-powered software factory builds reliable, cost-effective modern solutions for real logistics sector demands.

That advantage comes to life through several key differentiators:

• Purpose-built software: Cogna develops apps that solve the operational bottlenecks where generic software falls short — like route optimization, shipment tracking, and inventory coordination.
• Custom solutions co-created with internal teams: Cogna works with those closest to operations to design tools that fit real-world logistics workflows, such as automatic load planning, digital proof of delivery, and dynamic scheduling.
• Fast delivery, rapid results: With Cogna, functional apps are delivered in weeks. Companies achieve measurable impact and ROI fast and efficiently, protecting margins and driving momentum.
• Data integration: The platform’s AI-powered build engine connects siloed data sources — from TMSs to paper logs — enabling proactive responses, real-time visibility, and unified reporting.
• Enterprise-grade security: With Cogna, robust security and compliance are built in by default. Logistics companies can confidently automate mission-critical operations involving sensitive data, including shipment details, customer addresses, and inventory flows.
• Risk-off pricing model: Rather than being invoiced for proposals, companies only pay when solutions deliver the promised outcome, reducing financial risk during modernization.

Cogna is the collaborative, AI-powered tech partner that understands industry-specific complexities and is already empowering effective modernization for the logistics sector.

‍Cogna in action

To see what a modern partnership with Cogna looks like, take Ocado Logistics, a leader in the UK’s online grocery delivery sector. 

Cogna’s AI software factory built a custom RSM application that perfectly matches Ocado’s delivery methodology — in a matter of weeks. The tool continually digests historic GPS data and live updates, evaluating the factors that truly affect drive times. 

What began as a patchwork of spreadsheets is now an automated engine for decision tracking and process enhancements.

Ocado’s teams now optimize delivery routes in real-time. This improves precision and cost efficiency while minimizing unnecessary mileage and idle time — reducing emissions. On-time delivery performance has exceeded their 95% target, boosting customer satisfaction, while smarter routing has slashed last-mile costs and unlocked £400k in projected annual savings.

Ready to transform your operation and meet climate targets? Start modernizing today.