Interoute Interoute Transport Services

You may think running a transport business is not a job for the faint hearted in the current climate, but in reality the industry has had it tough for many years.

Talk to David Martin, co-owner and operations director of Thame-based firm Interoute, and it becomes clear that the last decade has largely been about costs.

The company recognises investing heavily in health and safety, quality initiatives, security and ecological considerations are all necessary. But they all bring extra spending and extra administration overheads with them, and EU regulations and Government red tape are on the rise, too.

How does a company re-organise itself to take on the ever-increasing overheads and still prosper? Interoute looked at what customers wanted and worked from there.

The roots of the company were laid down in Cardiff in 1934 when Bulwark Transport started up as a milk carrier. In 1992, as United Transport, the company relocated to Thame, occupying the site of local haulage firm Bennetts.

After being acquired by Rentokil Initial in 1996, Interoute Transport Services finally emerged as a private company in 2000.

The company had already embraced warehousing and palletised transport. As Interoute, the owners decided they needed to widen what they offered by adding transport services. So they engaged transport manager Kevin Inkley in 2005.

"We had a concerted marketing drive to bring in more business to fill the warehouse," explained Mr Martin, 62.

“Then we brought in Kevin, who has experience of general haulage. Kevin has grown that business to the point where we now have 20 vehicles going all around the country."

Mr Martin added: "We wanted to offer a one-stop shop. A customer can bring their goods in here from, say China. We can then offer large deliveries through our haulage operation.

“If they've got smaller loads we can put them through the pallet network. If they have parcels, we have an arrangement with a parcel carrier who comes in every day. It's a complete supply chain."

Interoute can also offer bonded storage. That means companies can defer paying import duty on the goods until they are delivered, which is a big cash flow boost for importing businesses.

In 2007, Mr Martin and financial director Brian Rogers, 65, engineered a management buy-out and became co-owners.

That same year they landed a three-year contract with a large electronics group which gave stability. The new owners then completed a move away from the already declining bulk liquid tanking market.

The marketing push had been designed to land contracts just like this to complement working with smaller companies.

At the same time as manoeuvring the business into a position where it could offer what their target customers wanted, Mr Martin and Mr Rogers had to tackle increasing costs.

Their approach was to collaborate wherever possible and they hired consultants for the areas where up-to-date skill and knowledge are crucial. Interoute are members of Pall-Ex, a network for palletised distribution.

Mr Martin explained: "We're responsible for some local post code areas. We collect pallets and bring them here before they are taken to a hub in Leicester, and on to hauliers for delivery throughout the UK and Europe. We bring back deliveries for our area."

The Transport Association comes into play for the larger articulated lorries. This is a group of about 60 family-owned UK transport companies.

"We can't park in laybys these days, so we park up in each other's warehouses and give each other mutual assistance," said Mr Inkley.

Mr Martin added: "We give each other back loads as well. Someone will come in here, having made a delivery locally, and asks if we have a back load that needs to go up, maybe to Manchester or somewhere."

"It makes economic sense but it also makes ecological sense," said Mr Inkley.

Driver training also now addresses economical driving as part of the compulsory Drivers' CPC (Certificate of Professional Competence).

This requires an average of seven hours’ training a year and Interoute has again collaborated to save money.

With a large site Interoute has a number of tenants renting offices and warehousing. Interoute shares training with some of its tenants' drivers to get better volume discounts.

Interoute use consultants for health and safety compliance and ISO 9000 quality accreditation.

"We need to make sure we keep up with all the changes and it makes sense to us to hire experts for that," said Mr Martin.

And the target market wants to see those measures in place.

"We do try to stick to blue chip companies," said Mr Inkley.

"We're selling service, we're not selling on cost. It's about what we can offer to the customers — a door-to-door service."

Source: Oxford Mail, July 16th 2010 - http://www.oxfordmail.co.uk