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If Freightex's software has helped it to ride out the
Page 18
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recession better than most, Phillips is anything but complacent about the effects the downturn will have on the business.
His chief worry, however, is ever-declining rates. Freightex calculates its rates, inbound and outbound, in money paid per 1,000 kilometres. Recently inbound rates have been running at around €1,200 (£1,103) per 1,000 km, but they have been falling for a year. Phillips says that a year ago, the same rate would have been €1,500 (£1,399) per 1,000km — in other words hauliers have had to put up with a 25% fall in what they get paid for doing the same job.
The stronger euro has protected UK haulers from this fall a little, because they gain a small amount back when exchanged for pounds, but the fall is still substantial.
Furthermore, says Phillips, the drop in rates is continuing, which is one of the reasons why so many hauliers are going bust this year.
The falling rates mean that even though there may be a little more work around than there was six months ago, hauliers are sometimes not earning enough to make the work economically worthwhile.
This needs to change, argues Phillips, and probably will once demand picks up, enabling hauliers to pick and choose the jobs they want to take.
The recovery is likely to be faced with fewer hauliers to deal with more work, which should put the fall in rates into reverse.