• With the recession showing little sign of abating, the
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road haulage industry is dogged by cut-throat rate cutting with too many hauliers chasing too little work. But up in the Northumberland port of Blyth three owner-drivers have decided to buck the trend. Instead of competing against each other for jobs, Dave Forshaw, Kevin Davison and George Hall have pooled their resources to form Blyth Independent Transport Services.
BITS started trading in June, renting a warehouse from the Blyth Harbour Commission for Z160 a month.
It took less than Z200 to make the warehouse habitable; the three operators made repairs themselves and "begged or borrowed" basic amenities.
Forshaw's wife Kim runs BITS as a sole trader. The three drivers retain their own long-standing customers who they continue to invoice individually, but work from any clients signed up following the formation of BITS goes through the books. Kim takes a percentage of the drivers' earnings for wages and the cost of running the office.
Forshaw specialises in light haulage, Davison in express freight (both using Mercedes 307s) and Hall handles the light deliveries in a Luton-bodied transit. 'We have office and storage space and comradeship," says Forshaw. We help service each other's lorries and cover each other's work. Take the time Kevin's back axle went. He rang in, George found him and towed him away, with no external recovery or towing charges." The practical benefits of the venture were also demonstrated when Davison lost £3,500 in 10 weeks through customers going bust. Forshaw helped him diversify into other areas.
BITS also sub-contracts work to other drivers "but not at the sort of prices we used to do sub-contract work for," stresses Forshaw. "We aim to make E10-15 on a major job, to cover costs and go towards the weekly fee for rent and overheads."
The one-for-all, all-for-one ethos of BITS protects its founders. "When we sub-contract work, we ask the driver for details of his main customer and check it out," says Forshaw. "If he tries to undercut us, it's one against four."
So far BITS has not advertised for drivers, but it would like to develop contacts with more owner-drivers. "We want them to register with us for a £10 fee," Forshaw explains. "We can pass business on without crossing into each other's areas. We can also arrange for drivers' contracts to be fulfilled while they're on holiday or their vehicles are off the road. We can sub-contract the work for them or do it ourselves."
TRADE UNION
What BITS does not want is "cowboys, "We're a cross between a business and a trade union," says Forshaw. "We want drivers to take time out without worrying that when they get back someone will have stolen their customers."
Forshaw recognises that larger firms have narrowed their nets to trawl the smaller end of the market, He is relying on the personal service BITS offers to contract customers: "I supervise and seal the load and I'm faster than an HGV because I'm not restricted to the outside lane," he says.
Forshaw charges a set rate to London for up to a tonne, which he describes as "semi-competitive". He explains: "A customer might not want a load brought back so you have to cover diesel costs and the hours spent driving back," he says. "But the same customer might call me and want six pallets brought back, and I won't charge him the same rate for the return journey. For a 7.5-tonner it's imperative to fill that vehicle both ways."
Future plans at BITS include careful expansion: "We'd like to buy a van — a box or curtairtsider — between the three of us in the next year and lease it to a self-employed driver. Eventually, we'd hope to sell him the van and he'd join the consortium," says Forshaw.
The extra van would provide back-up on Friday afternoons when, says Forshaw, "it's often hell to fulfil an order at short notice. We tend to fall back on the agencies."
Another facet of BITS business has already taken off — BITS storage can hold up to 24 pallets; no charges are made for additional loading and unloading.
No-one has yet approached the trio for advice about setting up a similar consortium: "Getting hold of cheap property is the main hurdle," says Forshaw. "Owner-operators are insular types who like going it alone. A set-up like this has to make sense geographically. Two BITS-type operations within a 60-mile (100km) radius would defeat the purpose, going back to the old situation of undercutting eachother," he says.
"One of the dirtiest things you can do is to take work from another operator on a contract basis and then go and pinch it from them," 0 by Gabrielle Mullarkey