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View from Olympus

24th June 1955, Page 57
24th June 1955
Page 57
Page 57, 24th June 1955 — View from Olympus
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Which of the following most accurately describes the problem?

TOO seldom are we . allowed to hear opinions on transport from the customer, and by that I mean not merely the transport manager or the sales manager, but the man at the very top of a big manufacturing or distributing concern, who deals with matters of major policy and makes the ultimate decisions. Next time politicians feel inclined to quarrel on the subject of transport, or operators to squabble among themselves, they might be well advised to study the chairman's address by Sir Geoffrey Heyworth (recently made a Baron) at the annual general meeting of Unilever, Ltd.

This year he chose transport as his topic. The Unilever products include such goods as soap, toilet . preparations and canned foods, perishable foods such as margarine, meat pies and sausages, and highly perishable foods such as ice-cream, frozen foods and fish. Distribution takes place all over the world, and Sir Geoffrey, while confining his discussion to his own organization, was able to range from the United Kingdom to Australia, from Western Europe to the U.S.A., and from Lapland to the Philippines.

Detached Impression

His wide interests give him the right to take almost a cosmic view of the transport situation. His survey leaves a curiously detached impression, as though he had been looking down from a great height upon the railways, lorries, ships and barges busily conveying his goods to and from every part of the globe. One feels that, to his widely ranging vision, the road-rail battle, or the see-saw between Conservative and Labour, is rather like what the wars of the Greeks and the Trojans were to the denizens of Olympus. Like them he seems remote, but has the power, if he chooses to use it. of influencing the course of events. He does not hide his deep interest in transport developments, and is not above giving direct advice or indirect hints to operators.

There is nothing revolutionary in his avowed policy. "We generally choose," he says, " the form of transport that provides the better service at the lower cost."

• Elsewhere he states, " we switch from our own transport to public transport and vice versa, according to which can give us the necessary service most economically." By way of illustration he selects from what one senses to be a vast array of figures. In the United Kingdom last year, 52 per cent. of Unilever soap was moved from factory to depot by rail, 37 per cent. by road. and 11 per cent. by water. Distribution from depot to customer of margarine, a more perishable product, is nearly all by road, because the quantities are small and deliveries frequent.

Significant Change

This traffic is shared between Unilever transport and contract transport, at present in the proportion of 80 per cent. to 20 per cent. The figures must be considered in relation to the total volume of the traffic. Approximately 1m. tons of margarine pass through the depots each year, so that only a small change in the proportions carried under C licence and by hauliers would be significant.

In choosing how their products are to be carried, Unilever cannot afford to be either sentimentalists or politicians. Transport is of primary importance to their prosperity. Their annual expenditure on transport is nearly one half of the tOtal wage and salary bill of their 250,000 employees. Their investment of £18m. in transport, handling equipment and warehouses is nearly 15 per cent. of the total investment in manufacturing and distribution facilities. The labour cost of producing a ton of washing powder is 13 man-hours, but the cost of delivering it from the factory to the retailer 200 miles away may be the equivalent of 19 man-hours.

Transport even affects the working capital needed. "The slower the movement of raw materials, intermediate products, and finished products," says Sir Geoffrey, "the larger the stocks that have to be maintained and 'financed." One day's delay in the world-wide operations of Unilever would tie up another £5m. working capital.

Excellent Advice •

It is not surprising, therefore, that Sir Geoffrey should show so keen an interest in transport affairls. He suggests that industry should be consulted by Governments before they sanction the investment of money in the different forms of transport. He plainly has in mind the planned expenditure of £1,200m. on British Railways and £150m. on British roads. He does not say whether he approves of these proportions, nor how he would like to see the money spent, but no doubt feels that, if required, excellent advice would be forthcoming from within his own organization. Transport advisers have been appointed by Unilever in London and Rotterdam, to study transport problems, to co-ordinate policy and to stimulate the consideration and application of new ideas relating to transport in its widest sense.

Sir Geoffrey also has a word of advice for providers of transport. Many of them, he suggests, have too rigid an outlook and policy, perhaps because of the unwillingness of the older forms of transport to accept the consequences of technological change and to meet the changing demands of industry. Managements are often reluctant to admit that the economic life of rolling stock, equipment or track may have come to an end long before they have become technically obsolete. A dynamic outlook is vital in transport. "The opportunity surely exists for labour, management and officialdom to do away with all the remnants of the old defensive attitude and to adjust themselves with open minds to the requirements not only of today but of tomorrow as well."

Usual Platitude

As may be guessed, the quotation is taken from Sir Geoffrey's peroration. The value of this kind of statement depends largely upon who makes it. From a politician, for example, it would be discounted as the usual platitude, calculated to fit snugly into the manifesto of any party. When it comes from the customer, however, transport operators should take it to heart, and learn to assimilate advice from the same source as they receive their bread and butter. Sir Geoffrey is the customer magnified to several times the normal size, so that there is all the more reason for operators to listen to his words and put them into effect. The Greeks found that it was sensible to treat advice from Olympus as in the nature of a command.

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