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Anything,
Page 24
Page 25
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anywhere,DISTRIBUTION IPMIE TF
anyhow!
Dominic Perry has been to meet the team behind Fortec Pallets — a relatively small player in a booming sector but one that has the advantage of a giant parent company.
0 f all the pallet networks out there, the one that's hardest to get a handle on is Fortec Pallets. Until recently it was simply known as Fortec, a name that even its senior executives struggle Lc) explain, and it tended to operate separately from the rest of the sector. Sure, on an operadonal level it did things in much the same Kay as everyone else, but it seemed different ;omehow, aloof perhaps. or maybe intent on aloughing its own furrow.
Even the firm's history and ownership seem :0 add to the confusion.
It started life in the mid-nineties as a means or domestic and international full and part.oad haulier Cavewood to handle its regional UK deliveries. Goods would come in from the -2ontinent to Cavewood's depot where it would be split among a network of regionally based hauliers for final delivery.
Then, in the late 1990s, Cavewood was acquired by French transport giant Geodis and with it the fledgling Fortec network. And soil remained, quietly working away in the background with very little fuss or marketing. From what we can tell, Geodis is quite happy to let Fortec run itself, rightly adopting an 'if it ain't broke' approach to the network. But the pallet set-up still seems somehow isolated from its ultimate parent, which hasn't replicated it elsewhere within its worldwide business.
Change at Fortec was finally stimulated by a combination of factors. First, the emergence of pallet networks generally as a dynamic and fast-growing sector of the haulage industry prompted Geodis and Fortec to think more clearly about the way the business was going. And second, the appointment of director Rod Abrahams in 2001 acted as a catalyst to push the firm forward.
Quality service As a 20-year veteran of the parcels industry with express operator TNT, Abrahams was responsible for adopting Fortec's current approach. He says: "The TNT mentality is the one we have applied here.The one thing about TNT you can't knock is the way it brought the concept of next-day delivery to the parcels market, coupled to quality service.
"The argument they use is that if you can offer excellent service then you can charge the right rate."
But that's as far as the influence from the parcels sector goes. Abraham says that despite some convergence in the form of quarter and half pallets being carried by some networks (Fortec offers half pallets), the two are totally different commodities: "You can always squeeze another parcel on a van, but getting another pallet on a truck is nigh on impossible.
"'There are also more things to think about with the freight itself: can it be stacked? Is it valuable? Does it need a tail-lift or forklift for the final delivery? It's more complicated."
When Abrahams joined Fortec, the depot tally stood at 28—but only for a few moments: "I walked into the meeting with 28 depots and came out with 27. The depot principal told me it was nothing personal..."
The total is now up to 58 with plans to expand to 65 next year; four new licensees have already been signed up. Abrahams says there has to be particular reason for joining a network, rather than simply because everyone else is doing so: "If you aren't joining a network to increase your profits, then we don't want to know."
Another recent Fortec recruit is network development director Alan Cramley. who moved from bigger rival Pall-Ex earlier this year. He echoes Abrahams' comments: "Without a doubt, the sector has become very well known. There are certainly hauliers out there who are asking themselves why they aren't in a network and whether they ought to be.
"I know it's a glib phrase and it's overused, but ultimately it's to do with quality. If you're looking to make a living off big delivery volumes then you're not what we're looking for. If, on the other hand, you're looking for something more manageable that will put you in touch with like-minded operators, continue this discussion."
It is, he admits, up to the network to do itt part too: "It's their business, their freight, then customers and their choice where they put it We've got to make sure that we're competitive enough and that our service levels are gooe enough to persuade them to put it through thc network rather than deliver it themselves."
So how does this relatively small network fit in with a global logistics firm like Geodis? (TO website boasts of its Thailand expansion.)
A network in its own right
Fortec started as a means to an end for Cave. wood, and under Geodis it was the basis of network where about 50% of the freight wm Geodis related. But now, Cramley says, the Geodis element is "very, very small".
He adds: "It developed into a network in itt own right — we're a stand-alone company anc we're profitable.
"I don't know the thinking in France but wh) rock the boat? Geodis has been happy enougt for us to develop our IT system outside of theit own systems because what they had wasn' suitable for what we do here.
"In a few years' time, we're going to need larger hub and we're already in conversatior regarding that project. No one's sayim it doesn't fit with Geodis's plans; they'rt. quite happy to spend money. It ha: already sent its property people to talk to cm: landlord and other parties about how the hut is going to develop."
At present,Fortec Pallets is growing at abou 15% a year and handling 2,500 pallets a night Cramley reckons the firm will outgrow it: current site by 2007.
Another advantage of being a subsidiary o Geodis is that Fortec's Continental needs an already catered for. Cramley says: In previou: jobs I talked to French hauliers about setting ui a network in France and they were muted abou the prospects of getting lots of them to wonl together. Look at what Palletways is trying tt do at the moment. if it works they'll have dom a great job. I know because I've tried it.
"But to look at it. from our point of view, wc don't need to do that because of Geodis. Ou licensee can input a pallet for mainland Europt into the system the same as his regular freigh and the only difference will be that the deliver ing depot is Geodis.
-The reality is that we can send anything anywhere, anyhow — it offers air freight. se; freight, parcels... even AD R." m