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THE PROBLEM OF BEET HAULAGE.

Critical Situation which May Involve Growers, Hauliers and Factories in Serious Loss.

By Our Special Correspondent.

IT has for some time been evident to us that the situation in the beet haulage industry, if one may designate as an industry an activity which only persists for ten weeks in each year, was becoming acute. Readers have no doubt noticed that our special contributor, " S.T.R.," has of late been occupying himself with " Problems of the Beet Haulier." In addition, we have had many letters on the subject from hauliers in the beet-growing areas, all tending to show that things are not as they should be. We accordingly decided to investigate matters on the spot and sent a Special Correspondent into the district to End out what he coufd. The result of his investigations, given below, will be read, we are sure, with considerable interest by all three parties to the industry, namely, the farmers who grow the beet, the hauliers who cart it, and the sugar manufacturers who rely on the other two for the raw materials of their product.

The article is written, let it be clearly understood, without any bias on the part of the author or of The Commercial Motor.

The sugar factory proprietors in the Norfolk area have been endeavouring, following on the reduction of the subsidy, to lower their costs of production. They are attacking this problem from all sides, and, naturally, have not overlooked the question of transport. They have been trying to get better quotations for beet haulage than have obtained in the past. The local hauliers, knowing the conditions, and being, at least as to the majority, fairly well combined without actually being in any official association, have been able to resist any attempt to cut their rates. In this, as I shall show, they are justified, as their charges are anything but exorbitant. The factory owners, bent on economy, and not seeing eye to eye with the local men, have gone outside for quotations. They have obtained a tender which is much lower than those of the haulage contractors in the district, and have recommended the farmers to enter into contract with the firm tendering. In the majority of cases the farmers have done so, even if only in compliance with the wishes of the factories. The present situation, therefore, is that most of the beet-haulage contracts for the next season are held by an outside firm, situated nearly a couple of hundred miles away and unacquainted with the local conditions.

The Contracts Under Scrutiny.

I have seen the contracts entered into with this outside firm of hauliers, and I have studied the prices they have quoted. I am of opinion that those prices are quoted in error, that they are based on a complete misunderstanding of the conditions under which beet haulage is carried on and that, if the firm concerned attempts to fulfil those contracts, it will very soon find itself working at such a loss that it will gladly take any opportunity to abandon the work. There is, to my mind, only one thing that will save the contractor, apart from a subsidy from the factories' (which, suspected by the local hauliers, seems to me to be absurd), and that one thing is weakness on the part of local hauliers themselves.

To understand the position it is necessary to have a fairly clear realization of the relations between the three parties concerned in the contracts, and to achieve that realization a brief r6sum4 of the short history of the industry is necessary.

The present stage of the beet-growing industry is of D38

recent growth. It started after the war, as the result of the energies of the sugar manufacturers, backed by a Government subsidy. The farmers had little or no hand in its initiation, but had to be persuaded, I might almost say bribed, to grow beet. The manufacturers had to promise definite prices before the farmer would consent to sow beet at all, and they had to make other concessions to his convenience in addition. One of the concessions made in the early days was in respect of haulage, particularly the cost of transport, and in order to get the crop the manufacturers would promise that the cost of transport would not exceed an agreed figure per ton. Contracts extending over considerable periods were made on such bases, and when, at a later stage, it was found that the figures quoted were too low to be practicable, the manufacturers were content to pay the difference between the contract figure and the actual cost. The manufacturers, in fact, showed themselves to be willing to subsidize the haulage. The fact that they did so at that time has been takep, by some of the local hauliers, to mean that they may be willing to do the same thing to-day. I think the hauliers were wrong.

Current Rates are Reasonable.

This question of haulage, and the cost of carriage of the beet from the fields to the factories, has always been a thorny problem for the manufacturers, and they have tried more than one way of arranging matters to their own satisfaction. Some four or five years ago they took control of the transport themselves. They hired the vehicles from the local contractors, at the rate of a pound a day per vehicle, the manufacturers paying all other expenses. One season was long enough to discover the flaws in that arrangement, and before the next the hauliers were informed that, for the future, the manufacturers proposed to concern themselves with sugar making only; they would look to hauliers to do the hauling.

Since then the local hauliers have done the work. The rates at which they have been doing it show a fair and reasonable profit, but no more. They start at 4s. per ton per four miles and increase at the rate of 4d. per mile per ton thereafter. That is, the rates are 4s. 4d. for 5 miles, 4s. 8d. for 6 miles, and so on, rising to 1.1s, per ton for 25 miles. How they operate, and the profits they show to the haulier, may be gathered from a consideration of the following figures, taken at random from the books of one of them.

In one week this man did two trips a day, carrying 51 tons of beet on each trip a distance of 16 miles. He did this for five days in the week, so that he carried in that period altogether 55 tons. The mileage covered was 320. For that his remuneration, at the foregoing rate, was £22. He told me he considered that week a very favourable one from his point of view.

Another week he did one 16-mile trip and one 12mile trip each day. The tonnage was the same, 55 tons, but, as 27i tons were only carried 12 miles the rate was less, namely, 65. 8d. a ton, as against 8s. a ton for the 16-mile journey. His mileage was 280, and his revenue £20 3s. 4d. That represented, in his view, a fair average week's work.

In another week he did one haul a 14 miles a day and one of 9 miles. 274tons for 14 miles at 7s. 4d. a ton amounts to £10 1s. 8d., a similar tonnage for 9 miles at 5s. 8d. returns V 15s. 10cl., so that his total revenue for that week, with a mileage of 230, is £17 17s. 6d. Presumably, although hesclid not actually

say SO, this haulier would reckon this a poor week. Taking the three weeks together as representing good, average and poor, adding_ the figure and calculating the mean, we get 280 miles and £20 for the mileage and revenue respectively. It may be more than a mere coincidence that these results agree so closely with those which my friend showed me as representing a fair average week's work.

Now, what does this average week's work cost the haulier? He is using a 5-ton lorry, but overloading it to the extent of half a ton-10 per Cent. The conditions are almost as unfavourable as they,1 can be, lacking only hills to make them absolutely bad. The . road surfaces, normally, poor, are at their worst during

• the beet-hauling season, which is from the middle of October to the end of the year. Collection of' the beet. takes place in the field, and low-gear work, in and out, is the rule. • There are frequent occasions when the ,vehicle is bogged, or partially bogged, at the roadside, necessitating more low-gear work and heavy petrol consumption in order to get free. In addition, there is the excessive wear and tear involved in these ciremnstances. All the running costs are therefore high, probably at least 10 per cent. and more likely 15 per cent, above average. Taking only 10 per cent., the running cost of a vehicle operating .under these conditions will be 7.25th per mile. For 280 miles that is

• 1.8 9s. 211. per week.

The standing charges are lower than the average. Wages and rents in the country are less, and the capital expenditure on the vehicles employed on -this work is not that allowed for in the tables published . by The Coartmereial .Motor. 15 a week will cover them.

Why Establishment Expenses are High.

Establishment expenses are high in this business— higher than might be thought by those unacquainted with the conditions. A fair amount of correspondence and organization is involved. The farms are scattered over a large area, as may be gathered by reference to tile fact that rates are quoted up to distances of 25 miles. Loads are neither regular nor sure. Some . system of keeping touch, on the one hand with farmers, and on the other with the factory, is absolutely essential. Difficulties have occurred, and will again, both • from too speedy delivery by the farmers, causing congesti-a at the factory, and from lack of beet when haulage units are available. The factory, too, may shut down unexpectedly because some attentionto the machinery necessitates a stoppage. All these things make it needful for the beet haulier to make provision for office work_ Either that or else he must lose by going out with his lorry only to find there is no work for it to do. If that occurs only once in a week it means a direct loss of revenue amounting to nearly 14. It Is, therefore, much more economical to have a telephone and someone to answer it as well as to keep in touch with clients. A pound to thirty shillings a week will be necessary to cover that expense, which is not. however, all that can he charged to establishment. There must be some provision against accident, particularly against ditching of vehicles, and for that another pound a week must . be set aside. In all £2 10s. is a fair assessment of establishment expenses.

The total cost per week is therefore £8 9s. 211,—pIus £5, phis £2 10s. --£15 19s. 2d.--say, £16 in all, leaving a profit of £4 a week.

Now, f.4 .a week profit per lorry might be regarded as reasonable in a country district prov,ided it persisted all the year round. Many a beet haulier would -be very glad indeed if he thought he could make that profit for the greater part of the year. He certainly cannot make it out of beet haulage, because the season for that lasts only 10 weeks! The haulage of beet is

• practically a casual job, and everyone knows that higher rates have to be paid for casual work. This 14 is equivalent to no more than £2 a week. It is actually and in fact no more than that if, in order to

get the work, the haulier misses 10 weeks' work during the remainder of the year. I am sure, therefore, that the most prejudiced sugar, manufacturer must agree that on this showing the rates at present paid for beet. haulage are none too high.

The New Rates.

The rates at which the new contractor is willing to haul beet are :—From all farms within 5 miles of the factory, 4s. per ton. Between 5 and 10 miles, '4s. 6d.; between 10 and 15 miles, 4s. 911.; between 15 and 20 miles, 5s. Od.; and between 20 and 30 miles, es. 611. Our friend's average day included one 51-ton load carried 16 miles and one carried 12 miles. , For a week he would, therefore, convey 27/ tons at 5s. and the same quantity at 4s. 9d. His revenue would therefore be £13 Ss. dead loss of £2 us. 44d. a week, allowing for establishment charges as before, and a loss of Is. 4i11. per week on the running cost of his lorry atone.

"But, why," the reader will ask, "why is this new firm quoting such low rates? How are they going to make it pay?" The question is a pertinent one, and fortunately, the answer can easily be found. It stands out, as plain as a pike-staff, in the contract form which the farmers have signed. The contractors have made a mistake! They have been misinformed, innocently no doubt, as to the conditions of this branch of the haulage business.

In the form of contract the above-mentioned schedule of costs is followed immediately by another, described as a schedule of "the rates on dry and wet pulp delivered to farms from the factory." The rates I need not quote: they are approximately the same as those for carting beet. In the body of the contract is a clause to the effect that the farmer shall agree to haul any traffic back to his farm, such as dry or wet beet pulp.

Clearly these contractors have reckoned on getting return loads to the farms, for which they would be paid the same rates as for the outward journey with the beet.

There are no back loads to be had ! Or at least they are so few and far between, and are available at such awkward and inconvenient times, that the effect is the same as if there were none at all.

There are clauses in the contract which, in the end, will make the farmer rue the day he left his local hauliers for the contractor, but I need not deal with them, "Sufficient for the day . " etc. There should he enough in what T have already shown to encourage all the local hauliers to stick to their guns and their rates.

There is no doubt that the services of the local men will be wanted. It is indeed a fact that some of them have already been approached and asked to take on I he work as sub-contractors. Actually, most of the haulage will be done in that way. The sugar factories have stated that there will be 100,000 tons of beet to haul during the coming season. 100,000 tons in 10 week is 10,000 tons a week. Reckoning 25 tons per lorry that means that 400 vehicles will be wanted. Clearly no existing organization will be able to provide its own transport, hence sub-contracting will be unavoidable.

Hauliers, Hold On to Your Prices.

All the local men need to do is to stick to their prices and to refuse to lower them. Agree to a mileage rate by all means, but not a 'fraction of a penny less than 18. ed. per mile run, and payment to be made weekly without fail. Let that persist for a few weeks, a very few weeks, Indeed, just long enough for the paucity of return loads to become known to the new contractor, and the work will come tumbling back again, at the old price, or a little more, if the local men think flt. and can hang together enough ta. demand it.