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It's not only farmers who have to diversify these days.
Page 58
Page 59
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Colin Bameft examines how TIP Trailer Services has expanded what was once a barely profitable traditional business and is now a flourishing concern. If your core business is operating in a highly competitive environment where margins are too tight to satisfy the shareholders, you have two options: you can add value to your offer, or you can give up. For decades,TIP has been a leading name in the world of trailer leasing and rental, hut it admits the returns in the current climate are barely adequate. However, rather than quit,it has introduced a range of additional products to its portfolio.
Since 2004,TIP Trailer Services has been an autonomous division under the huge umbrella of GE Equipment Services. It runs 70,000 trailers throughout Europe, with 10,000 in the UK on a 45:55 long-term/short-term ratio. It has been working to reduce the age of the fleet, having 2.000 new trailers since 2004.111e current delivery situation, with delays caused by axle and flooring shortages, isn't helping this process, although UK MD John Murray admits it doesn't hurt short-term rents, FleetCare The FleetCare product is aimed to keep trailers in service, whether they are provided by TIP or are privately owned. It consists of a maintenance and roadside assistance.The former. a completely revised maintenance service, is provided at operators' premises or the network ofTIP workshops.
While TIP has previously run a maintenance operation, most of the workshops belonged to a third party. Now, though, it has 13 workshops in the UK, plus one in Dublin, all operated inhouse. It is moving towards them all having MoT lanes, brake testers and trailer washes. All staff are nowTIP employees, and extensive coverage can be agreed to provide hack-up for tyres and ancillary equipment, as well as the basic trailer.The external service is currently provided by 16 service vans. Payment is either fixed contract or pay-as-you-go.TIP's iComply system provides online access to maintenance records, although it is not currently approved by Vosa as a primary record-keeping system.
The roadside assistance element is a pay-asyou-go trailer breakdown recovery service, available to operators regardless of whether any or all of their fleet is provided by TIP It offers a single point of contact across Europe, with multilingual and technically proficient call operators.As the 16 UK-based vans can't provide a full 24/7 service on their own, a network of contracted independent agents is used.TIP believes that using trailer specialist agents with generally lower labour rates than truck repairers reduces costs, and operators benefit from TIP's considerable buying power. Although users don't have to be TIP customers, they must have registered and opened a credit account, which speeds up response times.The target is to have a breakdown job allocated to the attending agent within 20 minutes and for that agent to be on the scene within two hours.
Finance "HP is also extending the scope of its financial services.Through its GE family connections, the firm offers a full equipment funding service beyond the traditional trailer core.
Despite a target life of five years for all bodied trailers and seven for skeletals, operators are increasingly looking for shortterm leases (known as MTL,s,or middle-term leases) of one to three years.TIP is using finance syndication to obtain the best rates for these operators, and eventually uses these semi-lifed returned trailers as stock for the short-term rental fleet. MTL is available on reefers and skellies, with eurtainsiders likely to join the line-up in 2008, FlexiRent & Fleetintelligence A further service is Flexi Rent, agree nients that give operators full versatility to match their trailer fleet to changing requirements with minimal penalties.The longer and firmer the customer commitment, the better the rate.
Meanwhile. FleetIntelligence is a business auditing service that examines an operation and reports on the areas where savings could be made. The greatest demand for this so far has been related to workshop outsourcing.TIP believes it offers a confidential and unbiased service identifying the costs involved in an operator's non-core activities, assessing and benchmarking them against known costs in the wider marketplace.The potential savings are said to be up to 12% of a fleet's operating costs.
TIP is currently planning a total revamp of what it calls Asset Intelligence, essentially trailer and load tracking and monitoring. Accepting that its previous offerings were probably over-sophisticated for many operators' requirements, and not everyone needs real-time tracking or minute-by-minute reporting, it will shortly be introducing simpler, lower-priced systems. •