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Feeding the market
Page 22
Page 23
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CM talks to Wincanton's Martin Taylor about plans to expand its food transportation service, and its desire to tap into the flourishing Asian market.
Words: Joanna Bourke / Images: Graham Richardson
ANGER, DESPERATION and crisis are the words we've recently come to associate with the haulage industry, but like a breath of fresh air in the smoke surrounding mounting fuel prices, Wincanton's managing director, retail, Martin Taylor opens the conversation with a brisk and no-nonsense tone to describe his company's objectives.
"We have a strong operating team and we are keen to develop our six strategy areas," he asserts.
An industry veteran, spanning 25 years at P&O and five in the retail section of Wincanton. Taylor succeeds a freight family heritage line, and having both father and grandfather in rail transport, has been highly influential.
He introduces us to the group's key focal points: container logistics; home delivery; recycling; data records; food services; and a joint venture with Hong Kong-based Kerry Logistics.
Healthy appetite
Food services may sound out of context for traditional haulage, but it seems they are creating some much-desired attention for the company. With the shadow of the credit crunch looming over consumers, food transportation seems an unlikely choice in a society governed by watching the pennies. However, Taylor demonstrates a smooth business demeanour when he begs to differ. "There is a high-growth food market; an increasing number of people eat out. We have clients including Punch Taverns and Eat Cafe," he says.
"Potentially you could move 500,000 cases per day of fruit and vegetables in a warehouse. You can have frozen, chilled and ambient products in one place and could employ 1,000 people. Food is vital to the supply chain and we're experienced in it," he asserts.
Eastern promise
Taylor brands Wincanton's work with Kerry Logistics as "a merging solution to account for efficient action in the Far East." No longer satisfied with solely a European market, he believes Asia has more warehouse capacity and larger markets, and therefore the potential for new business through products such as novel authentic foods.
Customer relations
Communication is an essential ingredient in Wincanton's successful relationship with clients, explains Taylor, whose hands-on approach ensures he meets at least three customers per week.
And with Wincanton's "portfolio of clients" ever expanding, such as the securing of a new contract with roofing materials distributor Marley Eternit, it is clearly a winning strategy for the company.
However, communication alone is not sufficient to survive the uphill struggle within the haulage industry at present, with margins consistently being squeezed by escalating fuel costs.
Avoiding the fuel cost burden is almost impossible, but Taylor insists that focus must be shifted on to minimising expenses elsewhere in the business, and exploring new avenues of revenue.
"We are looking forward rather than back, at improving costs and availability in [clients] stores. Customers are looking for new innovations and better deals. Availability is a key point."
Taylor reinforces his belief that there is no harm in dipping your fingers in many pies. Textiles is an area he would like to see developed. "There are opportunities to be made, such as pressing clothes and adding buttons for instance."
Green schemes With environmental awareness high on many customers' agendas, Wincanton is investigating green initiatives for its operation. Taylor says: "We are not just talking about being green, but actually putting the effort in. We will be led by our customers. If they want us to invest in certain vehicles, then we will."
The use of rail freight is one area Taylor is keen to exploit. "I would love to," he says. "Part of the problem is getting the capacity on a rail line. The container side is looking at that. Customers have spoken about this because of environmental issues."
Another idea mooted by Taylor is the creation of a 'white fleet', whereby companies load their products into consolidation centres, thereby not needing separate warehouses. Instead, space and money are shared by this joint storage. "With a white fleet, companies can make a profit by sharing deliveries in one unbranded vehicle," says Taylor.
Although there will he no liveried company logo on the lorry promotion will instead rely on the reputation of having frequent deliveries and on saving fuel expenses.
Taylor stresses that if retailers are willing to co-operate, then Wincanton has more of an investment to spend on its fleet. He adds that a large proportion of the retail customers are on openbook contracts, whereby a company such as Comet will finance the vehicle journeys and Wincanton will undertake the management side of the logistics.
IT enhancements Wincanton has also been looking increasingly at the use of IT to provide cost savings and streamline its operation. "We have been working on improving logistics with our IT systems. We use i2; a system good in terms of organising routes in the most efficient way.
Trained initially as an accountant. Taylor knows all too well that profit does not automatically guarantee security. Indeed, he confirms that while Wincanton is making a good profit, margins are still relatively low. "Facilitators will get the majority of profit, of which we will make a small margin."
No longer content with the once conventional A to B route. Taylor reinforces the necessity to branch further into other sectors to flourish in the current demanding and economically struggling society. With a smile, he adds that in 2007, there were more than 20 start-ups and 3,500 new staff taken onboard. Looking at the smile, there's no lack of confidence, and the message evoked is that Wincanton is a threat to other players — and intends to stay that way. •