Covering the country from top to toe 16


Hellmann Worldwide Logistics UK, as you might expect from a German-owned operator, has got the country covered, from top to bottom. Commercial director Matthew Marriott runs around 12-15 trailers a day for groupage traffic alone from the operator’s hub at Fradley Park near Lichfield, destined for points including Osnabrück and Polch – both in


the Rhine-Ruhr region of the country, Esslingen near Stuttgart, Nuremberg, Fulda in the centre of the country, Hamburg and Niederaula. The latter is the hub for Hellmann’s System Plus small pallet and package express system, which can cover the whole of Germany within 48 hours. The other depots cater for the more traditionally-sized groupage.


Lichfield is the main UK hub, and


cargo from across a wide swatch of England, from Newcastle, to Bournemouth, will be despatched from Lichfield the same night that it is collected; for outlying regions like Wales, Scotland or the far south- west of England and Cornwall it would be the following day. One of the plus-points of serving Germany, says Marriott, is that “it is


a very easy place to do distribution in.” The population and industry is very evenly spread throughout the country; there are few of the empty spaces on the map that you find in many other countries in Europe. Only Bavaria could in any way be described as remote but even that description is relative; compared with northern Scotland or the central Massif of France it is still


Issue 6 2013


///GERMANY


very much in the centre of things. This even spread of people and


commerce reduces the amount of empty running, and matters are helped by the generally excellent road and transport network. Germany’s Federal government structure has encouraged industry and commerce to spread throughout the country, rather than concentrate in specific regions, like south-east England. Meanwhile, a welcome


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feel-good factor seems to be permeating the UK/German trade, says Marriott. “We’ve definitely seen an upturn in the market since June and Germany has been a good part of that – so much so that we haven’t seen the usual downturn in trade in August – it’s only 5% below July.” Germany appears to be a


favoured country by would-be exporters, he adds. “Perhaps it’s because it’s easier


for our


exporters to hop on a plane to Europe than it is to Asia or Latin America,” he says. The UK/German trade is better-


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balanced in tonnage terms than most, with traffic inbound from Germany to the UK accounting for perhaps 60% and the return flow 40%. In value terms it could be a different story – much of what the UK exports to Germany may be empty boxes or raw material – which may cause the UK problems from a balance of trade perspective but not necessarily from the point of view of a freight operator. Freight rates out of the UK to Germany are though lower than inbound and recent currency movements have further increased the cost advantage. However, rather than use the differential to increase market share, many UK manufacturers have increased their profits, taking perhaps a rather short-term view. With


Sterling


having recently fallen against the Euro, many UK manufacturers and exporters have found that Euro


invoices yielded more Sterling, giving manufacturers a welcome profit boost. “But things can slowly go wrong if the manufacturer is not prepared to pass these gains down the supply chain,” Marriott argues. The lack of a really joined-up


long-term government strategy for manufacturing and lack of investment in the sector – barring a few flagship firms like Jaguar - is also frustrating, Marriott says. Germany may be one of the


biggest markets but it has also attracted many competitors. While customers do appreciate a professionally-managed supply chain, there will be those for whom price is the main consideration and there will always be the operator with a hole to fill on a trailer – and of course, most operators with an interest in European groupage will have a service to Germany. The pallet network operators


have also been trying to get established there, although setting up a viable service may not be as easy as in the UK. That said, there could be a market for a hub and spoke operation and indeed Hellmann has just become the European partner for UK Pallets, whose domestic hub is close to Hellmann’s


own operation in


Lichfield. “It will be interesting to see how the Germany market


accepts


pallet networks,” Marriott says. “Traditionally, this is a weight- based groupage market, and the networks in Germany move a lot of non-pallet traffic” - partly, perhaps, the market is more manufacturer- than


retailer-based. The main


operators, like Hellmann, also have very well developed inter-depot trunking networks. Hellmann’s Osnabrück


hub, for instance,


sends out 100 vehicles a night to all the other Hellmann hubs. “So I don’t think it’s a done battle,”


Marriott concludes. “However, we are well positioned in both markets.”


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