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Many UK hauliers depend on the construction industry to make

4th October 2001, Page 36
4th October 2001
Page 36
Page 37
Page 36, 4th October 2001 — Many UK hauliers depend on the construction industry to make
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Which of the following most accurately describes the problem?

a living. As David Taylor reports, it's a hard business with little yield.

Canstruction and road transport are arguably the mainstays of the British economy, providing the infrastructure necessary for just about every other activity. So it's a wonder that both industries suffer so badly from the effects of high costs, low profit margins, shortage of skilled staff and encroaching competition from overseas.

On top of this, both mad haulage and the building industry have a poor public image which is largely undeserved.

But if road haulage is going through a rough patch, operators working in the construction sector should be relieved to hear that construction is actually in a remarkably good state of health at pre sent. The financial performance of the top contractors, engineers and materials producers is currently very strong with a surge in share prices over the past year.

A recent survey by Construction News magazine reported that the 100 leading contractors have increased profit margins by 21% in the past year on turnover up just 10%. But something is clearly not right, because most of the hauliers who spoke to CM reported poor or, at best static, workload with rates still barely viable.

Nick Valiance, managing director of Devon haulier WL Valiance, says that his construction industry work is currently low: "Workloads are very poor. There's no capital infrastructure work in South Devon at the moment—they're just not building anything." Luckily for Valiance, the bulk of his work is focused on the multidrop pallet distribution business, mainly through the Fortec system, with some fuel distribution, car-parts delivery (for Peugeot and Citroen) and warehousing.

Hard rock

But roughly 15% of the company's turnover depends on the construction industry. The firm operates a fleet of half a dozen six and eight-wheeled rigid and articulated tippers dedicated to hauling construction aggregates from local hard rock quarries to construction sites across South Devon.

"The last big road job here was that stretch [of the A303] from Honiton to Exeter a couple of years ago, and mos the aggregate for that was brought train from quarries in the Mendips," s Valiance. His client, Aggregate Inciustri is one of the UK's largest Quarry firi with pits located all over the country.

The quarry at Kingkerswell, Vallance's head office in Newton Abbi has supplied the local construction ind try for decades. Vallance's firm has tx working there for 52 years and—unuE in this sector, it seems—has a formal': contract with Aggregate Industries. Sr hire is the norm, he explains

The contract is not all you ml expect, however: "It doesn't guaran us work: it just guarantees that our in

is will have preference over others len the work is available," says fiance. He runs three vehicles in ;gregate Industries' livery—two sixieel rigids and an eight-wheel tipper— d can supply more in his own livery to pplement these during busy periods. The firm also hauls aggregates for 'ter local suppliers, including aggretes giant Hanson, on a spot basis.

Valiance clearly considers it a rare nour to be given a contract for tipper irk, but he confirms that rates in this ctor are low, contracts notwithstandI. And while the contract gives a meare of security, there is no negotiation: tes are dictated, and the workload is


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