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pALLETS


The UK may be the ‘motherland’ of pallet networks but British companies have some remarkably vigorous offspring in other parts of Europe, says Palletways’ European marketing director, Fabio Manto. He is based at the headquarters of Palletways Europe in Switzerland, which is actually one of the few west European countries where Palletways does not have a presence. Swiss neutrality is as useful in the pallet network business as it is in international diplomacy. Mr Manto, an Italian who has spent much of his working life in the UK and was Palletways’ UK marketing manager until 2006, says that the operator’s first venture outside the UK was in Italy, in 2002. Italy can be regarded as an ‘upside-down UK’ with the more heavily populated, economically more prosperous bit at the top and industrial activity and population gradually ebbing away towards the south. The main hub was in Bologna in the north, with a second near Naples for the south. In the first instance, Palletways


decided to concentrate on the domestic market in Italy first, and built up a successful operation. A buyout by a team led by ex-


TNT managers intervened in 1994, bringing fresh ideas and more


cash and led to the foundation of Palletways Europe. Italy was by now a self-sustaining network and was handling a respectable 3,000 pallets a night on average, with peaks of around 4,000 a night.


Fabio Manto says: “We now


have 72 members in Italy, and the company is well known in the market and allowing for regional differences like insurance, the product is very much the same.” As in the UK, the core business are one or two pallet loads delivered next day, although Italy did introduce some new concepts such as the light pallet for goods such as shoes. This is the size of a full pallet, the weight of half a pallet and with a price somewhere in between. Now there are two competitors


in the Italian market, one a home- grown cooperative and the other with Pall-Ex involvement. “In a sense, one welcomes it because it shows that the concept was right,” says Mr Manto. He says he is somewhat


puzzled by suggestions that it is impossible to set up profitable pallet networks in Europe, “though obviously, circumstances differ for different operators. For a member-owned organisation, it may be more difficult to make such a decision than for


and Denmark. The CEN set-up is in fact currently being re- engineered and a Palletways Benelux is likely to emerge, though not yet a Palletways Germany. The CEN hub is currently at Nijemegen, close to the Netherlands-German border which allows Benelux and northern Germany and Benelux to be reached within 24 hours, but not the south. France though proved a more


Palletways has 72 members in Italy


someone like us.” Palletways is not a cooperative as such – the haulier members have more of a sub-contractual relationship - and decision-making is perhaps more centralised as a result, he suggests. Spain was the next area for expansion, with Palletways teaming up with Transportes Campillo. The network was launched in May 2006 and essentially duplicated the UK


and Italian networks though, being a fairly ‘square’ country, a single hub near Madrid allowed the 50 or so members to offer next day service to most parts of the country. Portugal was a natural progression and Palletways Iberia can cover all of this country in 48 hours and Lisbon and Oporto in 24. Next came the central European network (CEN) comprising Benelux, Germany


difficult nut to crack, even for the indefatigable Palletways Europe management. There were already quite a lot of small regional operators, making it hard to compete in the domestic market, so the solution was to team up with Geodis Calberson and also to concentrate on international traffic to and from the country. Palletways now had operations


in most of western Europe – 11 countries in all – and it was a logical step to add cross-border services and turn it into a pan- European network. It’s a bit of a logistics cliché, but it does mean that Palletways can offer a one- stop shop for palletisable freight – only a single collection truck needs to call at the customer’s premises, whether the cargo is going to Milan, Munich or Mansfield. Palletways also opted for


ISSUE 2 2010 Mother of all networks starts European family


a very simple five-zone tariff structure. On the whole, 24- hour international delivery is not achievable, but plenty of services like UK/Italy and Spain/ UK offer 48 hours, which more than matches most groupage services. “Don’t forget also that we’re daily, or at least four times a week – others may advertise a 48-hour service, but there may only be departures twice a week.” The pan-European freight


market is quite crowded, though, with traditional trailer groupage operators, parcels carriers and logistics companies all impinging on Palletways’ potential market, so initial volumes on the international network are measured in the hundreds rather than the thousands. “Yes, that might seem modest compared with Geodis which might be handling 4,000 pallets a night, but remember this is a different kind of business. Most of Geodis’ volume will be full load.”


Future development, says


Fabio Manto, will mostly be refining the existing network – perhaps adding additional hubs in countries where it would improve service level. Extension of the system in eastern Europe will probably have to wait a little while.


Nobby plots pan-Continental pallet service


Not all pallet services are run by networks of different hauliers. Norbert Dentressangle is planning to launch its own system covering much of Europe, building on the strong domestic networks in France, Spain and the UK that it has acquired through new subsidiaries such as Christian Salvesen. The new network will be brand-named RedEurope. “The idea is that we will


expand the offering to other countries and gradually expand the network,” explains Norbert Dentressangle International managing director, Patrice Schneider. Some local partners with strong networks will be


used, but there will be a common IT system to track pallets throughout their journey. It will not be a hub and spoke network. Instead, RedEurope will use existing depots and those of its subcontractors as mini-hubs. The network will also be able to use available capacity on Norbert Dentressangle’s existing groupage services, with dedicated pallet space on regular runs. This will also improve existing vehicle fill. However, says Schneider,


there will be no big launch of RedEurope for the time being. “We want to ensure that it is all working completely before we promote it in a big way.”


Fortec makes a move on Europe


The Fortec network is spreading its wings into new parts of Europe and is exploring partnership ideas with parcels operator APC. The latter is the recently appointed parcels partner for Fortec’s parent company, Geodis Calberson. Geodis’ managing director Jamie Cuthbert told FBJ that he believes there are possible synergies between the two operations, particularly within the two operations’ UK networks. Nightly trunk vehicles already operate between the Fortec pallet hub at Watford gap and the APC hub at Cannock. Meanwhile, Fortec has added to the range of pallet destinations available, including new links to the Baltic, Balkans and South- East Europe, he said. Fortec was founded as a UK network in 1996 and has increasingly


offered a pan-European solution over the last 3-4 years. As well as the extensive French, Belgian and Italian networks of its parent, Geodis Calberson, it can feed to and from the broadly similar Cargoline network in Germany, which also offers connections into several neighbouring eastern European countries. The regular Geodis Calberson groupage trailers operate as a bridge from the UK to the different European systems. However, the UK remains the foremost market for palletised freight, Cuthbert says. “There are already big networks in many European countries – not specifically for pallets, but they can handle them. Also, in the UK there was perhaps a greater willingness by the customer to split off their parcels from their pallet business – and there was also a need for rapid cargo delivery.” However, the Geodis group as a


Jamie Cuthbert


whole can offer a one-stop shop for most shippers’ cargo needs throughout


Europe, ranging from light parcels through to traditional groupage services operating around twice a week from the UK to most European destinations. The latter tend to be used more for bigger consignments over longer distances and are mainly for replenishing stocks. Cuthbert adds that the pallet networks themselves have had


a profound effect on the traditional pan-European groupage market. “People were still selling them perhaps 2-4 years ago but the industry has now had to build up new products and invest heavily in IT and customer service. People are generally looking to move smaller and smaller consignments.” Geodis Calberson is also launching an electronic booking


service for all its network shipments. It will handle all Geodis Calberson’s services and its partners, APC Parcels, the Fortec Pallet Distribution Network and other Geodis companies. It will also print labels for all Geodis network products. Jamie Cuthbert said: “Many customers are keen to book online and the new system will enable us to handle more shipments without increased costs and reduce warehouse and routing errors even further.”


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