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Slick oil distribution in Six Counties

25th June 1971, Page 44
25th June 1971
Page 44
Page 44, 25th June 1971 — Slick oil distribution in Six Counties
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Which of the following most accurately describes the problem?

by Bob Holliday

After more than 20 years of distributing oil in Northern Ireland, Shell-Mex and BP Ltd, last July completely revolutionized its distribution system for packaged lubricants there.

Before last summer, packaged lubricants had been delivered by parcels carriers in the Province. Mr E. Head, the operations manager in Belfast, told me that over the years they had experienced damaged goods, lost cartons, mislaid documentation and all that went to produce a dissatisfied' customer. He emphasized that not all of carriers were bad, but the experience was sufficient to cause the company to take a new look at distribution.

In more recent times Shell-Mex and BP switched their Ulster method of operation from spot hire to short-term contract hire. This system utilized four vehicles a day. Steadily rising transport charges and the fact that Shell's share of the market was increasing caused the company to rethink its distribution system again. For more than a year it examined traffic patterns by both quantity and commodity. The company studied how best to achieve optimum loadings along the route and how repetitive were the customers' orders. At the close of the study a number of new routes emerged, and around these routes the distribution system was created.

Shell now operates three of its own boxvans on packaged oil deliveries in Ulster. Customers have been advised of the delivery days in their area, and while the operations manager can almost forecast customers' requirements for a particular day, deliveries are only made against an order. Mr Head said that the system works because the company had engaged on a period of customer education. Shell's customers will normally phone in an order 72 hours before the delivery vehicle is due to leave Belfast, although in an emergency the company is able to make an unscheduled delivery at a few hours notice.

By using its own vehicles and working to a set pattern of delivery instead of the random deliveries of the past, the company has dropped distribution costs by more than 25 per cent, but more important they have now been stabilized. Taking into account the fact that costs have risen by between 10 and 15% in the 12 months since the system was started, Shell's actual savings are at the moment nearer 40 per cent than 25.

Great stress is placed on the fact that customers know almost to the minute when a delivery will be made. Vehicles cover about 120 miles each day, and make 15 to 20 deliveries, which fall into almost a timetable service. The reorganization is not the end of the line, because as the sales force develops the market the distribution plan will be surveyed.

Another aspect of Shell's new distribution system is the "package arrangements" with the Monsanto's textile plant at Coleraine. This company uses 300,000 gallons of fuel oil each week and has an arrangement with Shell that it will accept random deliveries, the only condition being that its total requirement is met and that levels are never dangerously low. This system gives the operator complete flexibility in that he can use any spare capacity in his vehicle fleet to make deliveries at any time during the day. But he is also in a position to make night-time deliveries, so Mr Head can accept delivery instructions for his tankers which will keep him employed all day and every day, and at the same time he can supply his Monsanto customers every night. This is the total-utilization dream of every operator.

Shell-Mex and BP are planning for future growth in Northern Ireland, and in this respect are developing their Belfast terminal in a number of ways.

When the present building operations are finished the older terminal and bitumen site, the refinery terminal supply complex and the new road distribution centre, will all be interfinked on one site covering 25 acres. Next month should see the new gantries adjacent to the transport area delivering black and white oil at up to 500 gallons per minute bathe road tankers.

From the Airport Road centre the company covers about 80 per cent of Ulster; the 20 per cent at the northern end of the Province is served from a depot at Londonderry which gets most of its supplies by ship from Belfast.

. Over one million tons-160 million gallons—of black and white oil, lubricating oil, bitumen and liquefied petroleum gas are delivered in a year by S-M and BIP to Northern Ireland customers.

This is mainly done by a full-time fleet of 60 vehicles, supported by relief fleet of another 20. Ten tankers work from Londonderry. The vehicles are AECs, BMCs, Leylands and Scammells, mostly with 6300ga1 tanks. During the past two years some 4000 and 5000gal vehicles have been replaced by 7000-8000gal types.

A team of 130 drivers work a variety of shift patterns-10-hour double, 8-hour double, 10-hour single and 8-hour single. They each average between 5000 and 10,000 miles a year, depending on the availability of the larger vehicles. A flexible productivity scheme, evolved from a work study carried out by the parent company, is accepted by the drivers and the Northern Ireland depots get a good response from their men, Mr Head told me.

Mr S. Duncan, the transport manager, took me round the Belfast depot's spotlessly clean, brand-new vehicle workshops where inspections and general maintenance, -as well as a certain amount of day-to-day repairs, are carried out. Major repairs are done by specialist firms in the district. A maintenance supervisor and three inspectors head a staff of skilled fitters.

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Locations: Belfast, Londonderry

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