Outsourcing trend boosts Jack Richards' operations
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dominic.perryrarbi.co.uk PETER BROWN. MD of Norfolkbased full-load specialist Jack Richards & Son, says the business has benefited from the recession because smaller manufacturing firms have increasingly outsourced their transport operations in a bid to focus on their core business.
Brown says the Eakenham transport company has a number of serious enquiries in the pipeline for transport outsourcing, all in the £500.000 to I:2m per year turnover bracket.
He adds: "People are looking at what they are doing and, thanks to the tightness in the supply of capital, they are evaluating where to make capital investments in their operation.
"A new truck and trailer is an expensive bit of kit If you are a manufacturing firm, do you want to tie that money up in a truck or invest in a piece of technology for your factory that will make your business more efficient?"
Outsourcing transport will also give a company a better ability to cope with fluctuations in demand, he says. Traditionally, outsourcing has been the preserve of large-scale manufacturing concerns, but Brown believes the recession has forced smaller firms to reconsider their transport provision.
Last summer, Jack Richards had its first experience of outsourcing when ii took on the transport operation of Manchester-based packaging company Rowpak.
Staff — five drivers and the transport manager — transferred across to Jack Richards under the TURF rules, and seven trucks also came across. They were incorporated into the firm's Northwich. Cheshire operation.
As part of the switch, leases on trucks were renegotiated and six new pillarless trailers, to be delivered in April, were acquired from Cartwright Group.
One of the benefits of the switch is that the vehicles are now better used, says Brown. Previously, they were only loaded one way.
He adds: -It has been a tough recession, but I'm convinced we are going to come out stronger."