Ofload warns of supply chain risk as Don Watson shuts down

Ofload has warned of increasing strain across Australia's freight sector following the collapse of major refrigerated transport company Don Watson Transport.

Don Watson Transport, which provided key cold storage and freight services along the eastern seaboard and delivered an estimated 10,000 pallets weekly to Woolworths, has entered bankruptcy, marking the end of decades of operations. The company was responsible for transporting goods over 22 million kilometres each year, and its closure is set to impact freight movement across the country.

The reduction in freight volumes nationwide has been attributed to inflation and rising living costs, which have led to a decrease in goods purchased by Australian consumers. Despite stable overall spending, logistics providers are reporting a decline in demand for shipping services, which is putting additional economic pressure on trucking and transportation businesses.

Geoffroy Henry, Founder and Chief Executive Officer of Ofload, said, "We are deeply saddened by the closure of Don Watson Transport. This is a moment to reflect on the fragility of a sector that keeps Australia moving. We feel for those impacted and are focused on doing everything we can to support workers, families, and businesses affected by this collapse."

"We saw during COVID just how essential these supply chains are to the functioning of our economy. When volumes fall, freight pricing often spirals into a race to the bottom. But if we fail to support freight capacity during downturns, we risk doing lasting damage to supply chains and undermining our ability to keep supermarket shelves stocked when demand rebounds."

"Demand will return. When it does, we'll need trucks and drivers ready to meet it. If the market doesn't support transport businesses through the tight periods, unsustainable pricing today will lead to shortages tomorrow. The cost will be paid by everyday Australians."

Wider industry pressure is leading operators to lower their rates below sustainable levels in an attempt to weather the downturn. According to Ofload, this approach is causing financially sound businesses to close as margins diminish and companies struggle to cover operational costs.

Ofload has announced a series of measures intended to assist those impacted by the closure of Don Watson Transport. The company has committed to supporting affected employees and drivers in finding new roles, ensuring that shippers maintain access to carrier services, and working to keep supermarket shelves stocked for end customers.

"We're committed to backing the people who keep Australia moving. We support drivers through the long tail of logistics and helping them find steady, profitable work by matching them loads while also optimising those loads to reduce waste," said Henry.

"Because our platform provides real-time transparency over national freight services, we can quickly divert necessary shipments to new carriers with better market knowledge and more efficient logistics."

"We know how important this freight is, especially when it means staple foods on shelves for Aussie customers, so we are dedicated to supporting affected shippers to minimise disruption to supply chains."

The company believes that the sudden loss of capacity following the closure of Don Watson Transport could have significant knock-on effects across supply chains. Ofload's digital freight platform enables shippers to find alternative carriers within minutes, and the firm offers expedited onboarding for new shippers seeking connections to its carrier network.

To further assist those impacted, Ofload has allocated its People & Culture team to help former Don Watson employees access job market support and identify new opportunities.

In addition to operational support, Ofload is highlighting the regulatory compliance features of its platform. "Shippers and carriers leveraging Ofload's platform won't just find necessary loads or trucks, they will also have full data over their logistics, including over carbon emissions," the company said. This is particularly relevant for small to medium-sized businesses preparing for new regulatory requirements introduced by last year's passage of the climate-related financial disclosures Bill, which mandates emissions reporting.

The legislation now requires businesses to account for Scope 3 Emissions, including those from distribution and transport, making it necessary to prioritise sustainable practices. Ofload states that its Carbon Analytics Platform provides users with the tools necessary to meet and exceed these reporting requirements, enabling companies to measure, identify, and reduce the environmental impact of their shipping activities.

The platform aggregates freight data from multiple sources to calculate and compare granular logistics emissions details, such as the total kilograms of CO2 emissions generated and the average emissions per kilometre or shipment. According to Ofload, this capability is essential for measuring the end-to-end carbon footprint of business supply chains. Several major shippers, including Noumi, Metcash, and Kimberly Clark, have adopted Ofload's free carbon reporting feature, and the platform has measured carbon output over millions of kilometres since its introduction earlier in the year.