8

PEOPLE / NEWS

ISSUE 1 2010

RH’s Baxter battles through tough times

capacity was an asset, but now it’s a liability.” Business is growing again at

around 15% and exports are much stronger, thanks to the weaker Pound. “In fact, this recession is the exact proof that the country is better off out of the Euro,” argues Ian Baxter. “Finland by contrast has a lot

of manufacturing that competes with Sweden and because they’re in the Euro, there’s nothing they can do to make their exports more competitive.” But he readily admits that

there is a flip side to not being in the Single Currency, in that it has driven up costs paid for in euros such as subcontracted East European haulage. “We had the perversity of a market that was falling in 2008 and 2009 but at the same time costs were rising dramatically. I had less business, but I needed a price increase.” Hence RH’s fierce cost-cutting drive.

After a year of tough decisions and severe cost-cutting, business is growing again says RH Freight boss, Ian Baxter

It’s possible to remain profitable in a recession, says Ian Baxter, but it’s a battle. The managing director of RH Freight, the country’s largest privately owned European road freight operator in the UK, has had to take some tough decisions over the last year or so, but believes that RH Freight is now a stronger and better-performing company as a result.

“We’ve done a lot of work

on our profitability, and in fact we’ve had a record first quarter – but it’s been hard-won,” he says. “If we’d sat and done nothing, we would have been hammered.” RH has cut its costs by

merging its London area and Nottingham offices into a single entity in Nottingham. There have been some redundancies, and

subcontractors have been cut back. But Ian Baxter believes that management of the company is now much more streamlined and it is in a much better position to face the future. Pruning excess capacity is no

bad thing in the current climate. “The problem is, if you’re committed to a lot of trucks, you end up driving down your own prices. In the boom times,

One area where the British government could help is in stabilising fuel prices. “When they increase duties, it makes life very difficult for us. It would be much better if the Chancellor could tell us what duty is going to be, and then stick to it.” Ian Baxter welcomes

proposals in the Conservative election manifesto, published on 13 April, for a fuel duty stabiliser which would offset increases in oil prices with lower taxes and vice versa. Until now, chancellors have

fairly routinely slapped a few extra pennies on a litre of diesel every budget, along with the regular increases in beer and cigarette prices. “I find it a bit frustrating that we should be

lumped in with these ‘harmful’ things – after all, we’re a business supporting British manufacturing.” The recession has taken out surprisingly few competitors. “But then there are state- owned or partly state-owned organisations in other countries, who have tended to carry their over-capacity through the recession. We don’t like it, but it does keep you on your toes.” He isn’t too worried about any

threat from pallet networks or third-party logistics companies. “We see them a bit, but we’re not afraid of them. At the end of the day, we can only build up our own business and prove our value on the market.” RH Freight’s own groupage

services operate daily, on 33 trade lanes and, unlike the pallet networks, can cater for freight in all shapes and sizes. Prague, Irun, Lyon and Nuremberg have all recently joined the network. “Also, our services operate daily. I think groupage has suffered in the past from its ‘Tuesdays and Fridays only’ mentality. We’ve tried to build a more resilient structure. After all, if you only operate twice a week, you’re effectively building in a peak demand to your system, whereas daily services give you a lot more flexibility.” The next stage in the

company’s development will be to add more value by developing a logistics hub somewhere in the London area, not far from RH’s existing base in Thurrock. This will be a 20,000sq building, more than half of it high-bay capable of offering the kinds of activities like packing and reworking normally offered by

3PLs. “We want to get higher up our customer’s value-chain,” explains Ian Baxter. “We could receive freight in from the Far East, for instance store it, configure it perhaps, add labelling or instruction booklets and pick it and transport it.” Is this a deliberate move into

the 3PL market? “We haven’t done this because we’ve been looking over our shoulders at the competition – it’s more to provide a better service to our customers, to help them optimise their own supply chains, where today they might be using a lot of different service providers.” Happily, the company is now

recruiting again and is taking on 35 new account managers. Recession or not, finding and retaining good staff is half Ian Baxter’s life’s work, he says. Qualified people haven’t been flooding onto the market in large numbers; the main effect of the recession has been a loss of fluidity rather than mass redundancies. “People who are in secure employment have tended to sit tight, whereas before they might have been tempted to try and move about more.” RH Freight is also about to

launch a big training push to ensure that the customer service ethos is carried right across the company. “People talk a lot about

customer service, but it’s not just for the customer-facing people. It’s also important for the ‘back office’ people, the warehouse staff, the drivers or the credit control department. To offer really good customer service, they have to feel part of the team too.”

Logistics giant aims to become a big force in forwarding

Norbert Dentressangle – best known for its pan-European logistics and groupage services – is planning to become a major player in the international freight forwarding market, following the launch of its Overseas division at the beginning of 2010. It aims to offer customers

a complete one-stop-shop as part of its ten-year business development strategy, explained Norbert Dentressangle International managing director, Patrice Schneider. “The idea is that we will be able to collect and consolidate freight in China, move

it to Europe and deconsolidate it and deliver it,” he told FBJ. Two Overseas offices have

already been set up in France, near Charles de Gaulle airport and Lille with another two planned. UK offices in Birmingham and Heathrow will be operational by May and others will be up and running in the US and China by the end of the year. A network of agents has been appointed to cover the rest of the world. In Europe, the company plans

to draw on its existing transport and logistics resources such as vehicle fleets and, in some cases,

depots. ND opened a new site at Hounslow in August last year, which is ideally situated close to Heathrow cargo centre – closer in fact than many existing airfreight forwarders’ premises. The initial thrust will be in full container loads, followed by consolidation services. However, Schneider said: “We also have very ambitious plans for perishables.” ND already operates a perishables centre at Heathrow as a facility provider, but does not currently get involved in temperature controlled airfreight movements.

A team of about ten air and ocean sales and operations staff has been recruited. Similar activity is taking place

in France, where the Overseas division is already generating turnover of around €200,000 a month. “The aim is to have a turnover of around £10m from the Overseas division by the end of 2010,” said Schneider. In ten years time the Overseas division should be generating around €300m a year. Schneider sees plenty of

potential synergy between logistics and overseas activities. Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36