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PIECE WORK
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Jigsaw Solutions consists of eight operators and a single no-frills "provider'. Tim Maughan sees how the firm fits together.
Jigsaw Solutions launched into the logistics marketplace 20 months ago, welding together the regional strengths of eight medium-sized operators to give them the collective might to pitch for the big contracts, against the big players.
The idea,in a nutshell is that a customer approaching Jigsaw can benefit from a 1.400strong national HGV fleet: a single phone call, and the customer is through to an £.18m outfit with UK coverage spanned by 34 depots.
It was six months into the venture that Jigsaw won its first major distribution deal under the commercial direction of initiator Paul Smith, formerly of Exel.The contract, worth £3m, involved handling distribution for Gist in its Carlsberg-Tetley account — a distinct feather in the co-operative's patchwork cap.
Smith gained his formative experience running a transport consultancy business, and in his management position at Exel.It wasn't hard for him to recognise the fault lines running through the traditional middle ground of haulage, where medium-sized hauliers lack both the capital arid reach of the large players, and the light overheads and agility of the owner-driver.Third and fourth party logistics firms,he claims, had an over-reliance on subcontractors which meant that prices and service levels both suffered. Not only could his Jigsaw perform more cheaply but it could do so without losing the family touch and high service levels of mid-level hauliers.
Quality of service and of contract is vital. "It's not a clearinghouse," Smith states."It is a limited company, a haulage co-operative, and a services provider."
Smith, now managing director, is an equal shareholder with the eight operators whose assets are at Jigsaw's disposal Each holds 11% of the stock and continues to operate independently and invoices Jigsaw for work done, much as in any other transport network, such as the pallet business. As shareholders, they also receive a profit-based annual dividend.
Turnover is now an impressive £18m based on five contracts. "We work with blue chip companies like Carlsberg and MFI," he says and he intends to build on this high level success. By the close of the third financial year, he wants to see turnover rocket to £35m.
Jigsaw now has contracts with MFI,Master Foods,Forest Garden and Robert McBride, hauling lager,DIY goods,shampoo,deodorant, ambient groceries and garden fencing.When a new customer is secured, says Smith, Jigsaw personnel draw up a profile, outlining the make-up of the company and its transport requirements. -We look at volume flows and geography: it's important that the parts of the jigsaw lit together," he says.
Jigsaw member Michael Swain, managing director of Macclesfield-based F Swain & Sons. fields a 120-strong fleet of curtainsiders. In 2002, he used the services of Paul Smith, when he worked as a transport consultant and Swain was a co-founder of Jigsaw.
On any one day. 20% of the Swain fleet is assigned to Jigsaw duties; true to the Jigsaw philosophy. Swain's trucks concentrate on transporting goods across its own region, in this case the Midlands and the North-West.
The national network, says Swain,gives regional operators like himself the resources comparable to that of the giant national fleets. "It gives a provincial haulier the clout of a national haulier. and the opportunity to compete."
It has also taken some hefty capital adjustments to accommodate the Jigsaw work.
"Compromises do have to be made, and there are wins and losses on the swingometer. But if you were outside looking in, you would realise the monetary value of being in Jigsaw. It's nice to rub shoulders [with fellow operators],and to have a frank and honest exchange of views."
Swain argues that Briti.shroad transport can be cursed by"chauvinisficflgures".'There is a great degree of mistrust between hauliers," he complains.
Hence the operators involved in Jigsaw were carefully chosen, says Smith, vetted for compatibility in business and personality terms. Members also had to have the right sort of equipment at their disposal.
John Hawksworth is commercial director of the 100-year-old Widdowson Group:This company runs 120 trucks; the trailer fleet consists of step-frames,flats,and curtainsiders. He says that Jigsaw allows Widdowson to involve itself in large, prestigious contracts;without Jigsaw's umbrella this would not always be possible. "A couple of years agol would have viewed the Jigsaw concept in another light. Hauliers used to not talk to each other, but [now] hauliers of the same size know that they must get together."
Smith's past work was all about dealing with operational issues. Today, the emphasis is on handling purely business matters. With eight independent operators and a host of customers to serve, Smith spends a lot of time with the people who pay the bills.
If Jigsaw's turnover is to double as intended, is the strategy set in stone? "Yes, there is a business plan," he asserts. "Winning contracts.
With time, he says shareholders' HGVs will -jettison" elements of their spot-hire work and take on more Jigsaw consignments: "With 1.400 vehicles and 34 depots there are no areas of geographic weakness, and the fleet can cover any seasonal peaks." •