Ticket to ride
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Abbey Road Tanks might not have to work Eight Days A Week to head up Penny Lane, but it is keeping the Taxman happy. CM meets the driving force behind one of Merseyside's rising hauliers.
Words: Roger Brown / Ima um Cunningham
ONE HAULIER IN Merseyside has not been making a song and dance about increasing its profit this year.
Nevertheless, Abbey Road Tanks (ART), the hulk food tanker specialist based in Bootle. has managed to thrive, building solid relationships with clients in a niche market and developing a clear vision of where it is heading.
Thirty-year-old Steve Granite became managing director of ART early in 2009, and is undaunted by the task of continuing the firm's upward progress in a difficult economy.
He tells CM: "Over the past few years, the company has grown revenues through better transport planning. and I will be looking for this to continue. Due to the current economic climate, we do not envisage the level of growth experienced in recent years will continue into 2010, but a prudent approach to business will ensure profit margins do not suffer."
Liverpool-born Granite joined ART on a management training scheme 14 years ago, qualified as a management accountant in 2002 and became finance director two years later. He believes the company will see future growth in three main areas: bulk powder, dairy and refrigerated transport.
"We think there are plenty of opportunities for growth in these areas." he says. "Milk is currently about 2% to 3% of our business, but the milk industry is bigger than the other industries we are in. We see this as a definite area for us to develop. The financial success of the past few years has given us the platform to be able to start diversifying."
ART transports products such as refined vegetable oil; glucose syrup/sugar; chocolate; dairy ingredients; mineral water and chilled products for clients such as AAK; C:argill; ADM; Barry Callebaut and Unilever, Its pre-tax profit increased
to £807.825 in the financial year ending 30 June 2009, from £605,604 in the preceding 12 months. At the same time turnover rose to £19.1m from £16.6m. Impressively, this year's figures come against the background of annual profit growth of around 15% over the past five years.
ART operates one of the larger privately owned tanker fleets in the UK. It has 115 trucks, all DAFs, and 160 tankers, with in-house service workshops at its two main operating centres in Liverpool and Hull. It employes approximately 200 staff, of which about 150 are drivers.
Granite believes the company is now robust enough to consider making an acquisition if the right opportunity comes along, but says it is looking for growth in the future by developing business with existing customers.
'About 90% of our business is longterm contracts': he says."We like to have
contract lengths with our customers of between three and five years so that we are building good, solid lasting relationships based on us providing good service. On our contracts we examine what we can do to add value. For example, if we are transporting liquids or ingredients to use in making burgers, we will also look to carry the finished product where possible."
The firm runs its transport operation similar to a palletised network using vehicle tracking technology from Trakm8 to help maximise usage of tanks It buys tanks from suppliers including LAG, Feldbinder and Clayton Commercials, and uses specially modified tankers for chocolate products, but Granite says there is still the possibility of pushing the barriers on payload for standard tankers. The capacity used to be 28 tonnes, this went up to 29, then 291/2 tonnes, and now 30 tonnes is the target. We believe payloads can still he increased further through the wider adoption of materials like fibreglass for tanks."
Granite also admits the firm would consider transporting foodstuffs by rail. I.le says he is impressed with John 0 Russell's train operation for Tate & Lyle, which takes hulk cane sugar products in liquid and granulated forms from East London to Scotland (CM 30 July 20(19).
"We would look at exploring the rail option if there was a viable route, which made good economic sense for us," he adds. "However, the plan is definitely to stay in food, we do not intend going down the route of transporting fuel like other tanker operators such as Turners (Soham) or Hoyer." •
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