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9th June 1972, Page 54
9th June 1972
Page 54
Page 55
Page 54, 9th June 1972 — management
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Which of the following most accurately describes the problem?

matters by John Darker, AMBIM

Removers face the future

AT BRAINS TRUST sessions at the recent conference of the British Association of Removers the industry's future obviously gave rise to some anxieties. The richer members of the association — and some, I'm told, are very rich indeed — seemed confident that there would be no insuperable problems. Offering specialized services in a metropolitan or prosperous suburban environment, the competition offered by newcomers running light vans or "U-haul" services was not at all worrying.

Removers based in poorer areas of the country, in contrast, appeared to be distinctly worried about the effects of present and likely future competition from enterprising newcomers with small capital and negligible overheads.

Mr Ron Reedman, representing a large Australian firm of removers, told how a large business faced competition from small men. He stressed that the larger a business got the more difficult it was to control — but against that, the firm could afford to pay more. Promotion prospects, too, were better in a large firm so this made it easier to recruit good quality staff. But depots must not be allowed to get too big for service standards to be prejudiced.

His company had found it necessary to reduce the size of depots to 20,000 sq ft and some 10-12 vehicles. When a depot became overloaded it was not given more vehicles; a new depot was set up some five to eight miles away.

It is interesting that an experienced remover should consider a 12-vehicle removals depot to be the limit of sensible size. In general haulage, depots of 50 or even more vehicles are not uncommon, though there is general recognition of the control problem. Contracts depots, where different factors obtain, could be very much larger — I have seen designs of depots for several hundred vehicles, but with contracts the main problem is presumably vehicle maintenance, where size economies can, in theory, prove advantageous.

Size is no merit When Ron Reedman amplified his point about depot size he argued that size of a company was no merit in itself. Even though units were kept small a superstructure was needed to run a big company and operations must be very profitable to sustain overheads. In Australia, forwarding firms regarded removers as a threat. The banks were not in love with requests from removers for finance. Ron Reedman thought the removals trade was reaching full circle.

It had begun in the horse and cart days as a side-line to general carrying and had developed as a speciality when vehicles became available. Businesses had progressed through mergers and takeovers and there were a number of quite large firms. But now the mouse — the small man — was nibbling away at the elephant. It was said that in the United States 20 per cent of people could not afford to move — certainly at the rates charged by established removers. This was almost the position in Australia now. The moral was that removers must diversify.

A Canadian operator. Mr Brian Bennett, spelt out the competition of U-drive in Toronto, where 3200 small operators competed with established firms in a population of 2m. "When a family can move itself with a tow-truck behind the car for 135/40, two friends and a case of beer — and have a party afterwards — why wonder at its popularity against the 1175/200 charged for a typical metropolitan removal in Toronto? That is why the industry has concluded it must join the bandwagon and provide U-haul as a second service."

In South Africa, it emerged, do-it-yourself removals were not a problem. "We're much too lazy," said Mr F. Porter, from Stuttaford Van Lines, of Capetown and Johannesburg. Clearly, where labour is relatively cheap and the predominant white population is accustomed to getting good personal service at low cost, it will be years before the same economic factors encourage the competitive services that are so worrying to sizeable operators in Europe and America.

Container operators Ron Reedman (Grace Brothers Pty Ltd, Sydney) told BAR delegates that a lot of their traditional business had gone to container operators. The trend was for tally clerks to check goods at customers' premises. It was now essential for removers to use containers, despite the many problems involved, because of the influence of shipping companies and governments in promoting containerization. Few conventional shipping services were available, as an alternative.

When the younger generation of removers made statements, in another panel discussion, Mr Michael Wigg, of P. Wigg Ltd, Lowestoft, said he thought the incidence of VAT would compel established removers to charge 10 per cent more than their small competitors. He felt the industry could not afford to charge more and thought pressure should be put on MPs to ease the competitive disadvantage. He urged that established removers should enter the U-drive market, since it would be possible to provide the facility of picking up trucks, anywhere and dropping them anywhere.

Michael Wigg thought that profitability greatly depended on turnover. It was doubtful if operations would be profitable if 1500 hours work was done with a vehicle but annual operations of 2500 hours — at a lower rate — could be. He wanted more research as to where business came from — was it from advertising or personal recommendation? And he speculated on the likelihood of women entering the industry.

Quality or quantity?

Mr Max Godfrey, of W. Sharpies and Sons (Lancaster) Ltd (son of the treasurer of BAR), saw the dilemma of the Association as quality or quantity of membership. There was a danger of unbalancing BAR but he felt the risk of letting forwarding agents join to be exaggerated. The industry had changed vastly since many of the member firms were admitted. Speaking as a member of the Association's ethics committee, he said the industry did nothing to maintain its standards. "If we can't keep our members up to the mark should we not be liberal to outsiders? The RHA is less hypocritical than BAR. If we expand our membership our influence would be greater and we'd solve our financial problems."

Max Godfrey hinted that the RTITB had had more brickbats than they deserved. The best premises and vehicles counted for nothing without trained men with pride in the job. Management needed to be trained to accept the role of training and impetus for training should come from management.

Mr Len Cox, of Robert Darvall Ltd, Reading, wanted the industry to get rid of its cloth-cap image. He urged that a number of firms should co-operatively organize a pallet storage facility. He thought haulage firms were likely to be compelled to move from inner town sites to a transport estate backed by a local authority. With entry to the Common Market removers must think in terms of 1000-mile removals and this might mean that 3000 cu ft lorries and trailers would be necessary for economic reasons. Conceivably, as this would involve three or four days running, it would be a better bet to arrange air removals to places like Rome, with delivery in one day. He felt BAR should join with RHA to urge the use of sleeper cabs in this country.

Mr Peter Barrett, of Old House (Seaford) Ltd, was not satisfied with BAR's help with TIR inquiries. BAR, he felt, should provide carnets; it should not be necessary to seek help from the RHA or from an experienced Continental haulier. BAR should help members with details of Continental public holidays, etc.


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