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1. Essential for tipper survival

6th May 1977, Page 76
6th May 1977
Page 76
Page 76, 6th May 1977 — 1. Essential for tipper survival
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Which of the following most accurately describes the problem?

THREE essentials for survival were suggested by David Lowe, of David Lowe and Associates in the first business session of the Convention. These were selling as well as providing a service; obtaining a proper return on investment; and operating at a profit.

Deprecating the lack of financial control exercised by operators, Mr Lowe urged delegates to take a critical look at the way they financed their businesses. Too few operators costed their operation objectively. This involved neglecting to ensure • that a proper return was obtained from money invested and effort extended.

Mr Lowe emphasised that operators and their staff — including drivers and switchboard operators — were essentially salesmen. If the service was not sold effectively then the operator would not survive.

The sales function did not refer only to obtaining new business. Selling should be directed at existing customers too.

It should never be assumed that customers were neatly sewn up. Even those who had patronised a haulier for many years could withdraw their traffic.

First, however, it was necessary to study the market place and identify the potential Then the market sector to be approached should be established.

Some attempt should be made to analyse the possible fluctuations in the market in relation to the changes in industrial activity and this should bei monitored constantly.

Having made the analysis, it was necessary for an operator then to sell his service by visiting companies and telling 'them what he had to sell. Care should be taken to mention all of the facilities offered and, finally, he warned of making the salesman's classic mistake of forgetting to ask directly for an order.

Having secured the business, then the operator should not slacken his efforts. Upholding the image of the company was important and it was prudent and honest to inform a customer of any failure before he discovered it for himself.

Mr Lowe asked operators to recognise that efficient financial control of the business was the key to success.

It was essential to cost the operation and relate those costs to the rates charged. Moreover, it was important to determine the customers for whom an operator was prepared to work. These should be principally those who were prepared to pay a realistic rate and to pay up on time.

Credit control was not only sensible but critical. Hauliers should invoice much more regularly than once a month and should find out from their customers the best time to invoice.

Now that so many accounts systems were computerised, he explained, purchase data was fed into the computer at particular times of the month depending on the customer. It was not reasonable to assume that operator's invoices would be fed into the computer at the month end. This period was often taken up with paybill compilation.

Finding out when a particular customer processed purchase invoices for payment would ensure that an operator's invoices would be in time to be dealt with currently_ This would ensure prompt payment.

Rigid control of costs and cash flow were the best ways of assuring survival.

Both J. E. Kirby, Federated Road Transport Services and Jack Male.. Male and Sons (Pensnett) Ltd and national chairman of the RNA, spoke about approaching customers for rates increases following the Chancellor's Budget.

Tags

Organisations: RNA, US Federal Reserve
People: Lowe, Jack Male

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