TDG plans triple merger
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by Amanda Bradbury • Three TDG trading divisions are to merge in January and there will be job losses, but not at senior management or director level.
The amalgamation of Harris Distribution, Albany and Network Logistics will create the largest trading unit within TDG with a combined turnover of £100m. The combined group will be marketed as Harris Logistics Network.
One of its priorities will be operational cost reductions, including depot and vehicle usage. A combined network of 45 depots, 450 vehicles and 2,000 employees will report to managing director Peter O'Keefe at Harris' base in Baguley, Manchester, where Network is also sited. Redundancies will come from Albany's 15-strong Harlow, Essex head office; TDG director Paul Byrne will try to redeploy staff within Harris.
The merger follows a dip in TDG's distribution division's half-year profits to 30 June, which was blamed in part on four contracts lost by Harris Transport. Byrne says the merger is not a direct reaction to this move—the work has been replaced—but is designed to compete effectively in a tough marketplace where new business is hard to find.
"Our customers, food manufacturers and supermarkets are tough negotiators," says Byrne. "Because they have not got the ability through inflation to increase margins, they are looking at their supply chain."
_3 TDG may use the merger as a model for other high-profile parts of its business which have traditionally run as large numbers of autonomous trading units.
In the past five years the company's range of 90 brand names have been reduced to 20. Recent mergers have been in the plant hire, ambient warehousing and cold-store businesses.