Soaring costs hit hauliers in the pocket
Page 4
If you've noticed an error in this article please click here to report it so we can fix it.
By Derren Hayes HAULAGE FIRMS' cashflow has been hit by a double whammy of rising costs and a rates crunch over the past year, a survey by the Road Haulage Association (RHA) suggests.
Many hauliers that took part in the survey were either short of cash or reluctant to invest it in their businesses because of the economy, with 42% reporting "dissatisfaction" with their banks and a reluctance to rely on them for financial support. One operator saw profit cut by 10% when its bank overdraft facility was replaced with an invoice financing arrangement costing three times more.
However, the survey of RHA members' costs found significant rises in the amount spent by hauliers on tyres (up 10.1%), insurance (6.6%), vehicles and depreciation (5.9%), and repairs and maintenance (4%).
On the plus side, the two largest costs to haulage firms (fuel and driver employment, accounting for 33% and 24% respectively of total overheads) rose slower than inflation (currently 3.2%) in 2012.
The report also highlights the continued squeeze in haulage rates, citing the example of a large construction firm that had cut rates by 5% and doubled payment terms.
LOSING THE FIGHT Norfolk haulier The Delivery Specialists, which traded as Clarks Direct, has gone into administration after a number of its customers ceased trading. The firm had been operating through a company voluntary arrangement (OVA) since 2010.
MD Paul Clark told CM he plans to close the haulage business but hopes to continue offering warehousing under the Clarks Direct brand. He added: "There's no money in haulage and it's really our pallet delivery [Pall-Ex] service that had to close."
Palletways member TAG Transport Services has also gone into administration. The £2m-turnover haulier, which runs 18 vehicles out of a depot in Croydon, Surrey, appointed joint administrators Simon Plant and Daniel Plant of SFP Group on 18 January. It handled the OR and SM postcodes for the network.