Vol. 511 No. 6
45 Mr. Perry asked the Tánaiste and Minister for Enterprise, Trade and Employment the plans, if any, she has to heighten awareness in firms of the competitive importance of logistics, including education and training in logistics and increased use of information technology. [25423/99]
The national development plan recognises the importance of logistics to overall competitiveness and points out that the development of logistics as a key capability will be supported through the National Institute for Transport and Logistics.
The National Institute for Transport and Logistics is an initiative of my Department to support companies in Ireland in achieving competitive advantage and to help Ireland become a major international centre of logistics excellence. The significance of our geographical location as a factor in the competitiveness of Irish business has long been recognised and has been frequently highlighted in recent times. The ability of Irish exporters to supply markets with increasingly demanding logistical requirements is, more and more, dependent on a greater level of transport expertise and skills.
The NITL offers information, training and education programmes as well as facilitation and consultancy to manufacturing, process and service companies in Ireland. It also offers higher education programmes to school leavers in co-operation with the Dublin Institute of Technology to further increase the pool of skilled employees in Ireland.
Enterprise Ireland has recently commissioned the NITL to carry out a study into the logistics capabilities and requirements of its client companies. The study will highlight logistical problems faced by companies throughout Ireland and identify the steps required to improve their competitiveness in this area. The study, which is due to be completed by July next, will also address the impact of e-commerce on the logistics requirements of the companies surveyed.
The NITL is also currently collaborating with a FÁS-sponsored study on the labour supply and demand needs of the transport and logistics sector. This work will feed into the deliberations of the expert group on future skills needs.
The introduction of centralised distribution by the retail multiples with deliveries direct to a single location will lead to the by-passing of local distribution. The distributive trade is very staff intensive and employs up to 25,000 people. It is reckoned that the alteration in distribution methods will mean 40 per cent of multiple retail business will be done through central distribution. Is the Minister aware that as many as 5,000 jobs will be lost because of this?
Will the Minister consider the appointment of an independent facilitator to develop a co-operative strategy? Many companies are unaware of the far reaching implications of centralised distribution which will expand and is here to stay. There are more than 163 companies in the grocery supply and distribution chain and many of them will be affected. Some are unaware how to deal with the problem. Will the Minister appoint a facilitator to educate those companies in the technology necessary to combat the problems they will face?
It is recognised in the internal market and worldwide that there will be fewer jobs in distribution. Logistics relates to managing warehouses, inventories and so on. Many successful companies, such as Dell, do not hold stock in warehouses and have cut out middlemen because all their products are customised. These methods will bring enormous changes, particularly in an economy like ours where the scale of things is very small.
If my Department can help to educate people about what is happening I would be delighted to have it do so, but the National Institute for Transport and Logistics which is supported by my Department and which I recently visited might be the most appropriate body to deal with companies in this area. Getting goods to the market more speedily than in the past is very important, particularly in an e-commerce market. Companies will have to deal with the enormous consequences of these developments. Unfortunately jobs will be sacrificed in some sectors to maintain them in others. That will be the reality in the distribution business in Ireland, in the EU and throughout the world. I will communicate with Deputy Perry regarding a suitable person from the institute who might talk to the companies in question.
I welcome the Minister's undertaking. The development of centralised distribution and the recent arrival of another supermarket chain in Ireland, which is very welcome, have serious and far reaching implications for smaller companies. The Minister's recommendation that a facilitator be appointed to talk to companies within the chain is very welcome.
I have recently noticed that some Irish products go abroad to centralised distribution networks and then come back to stores in Ireland. Extraordinary things are happening rapidly.
That concludes Priority Questions.
