UNITED CARRIERS THE PHASE OF CONSOLIDATION
13th December 1968, Page 54
13th December 1968
IN road transport timing is often the crucial factor in success. New types of transport services or new designs of vehicles can be spectacularly successful if introduced at the right time. If the innovation is premature the market does not respond and much money may go down the drain.
A timely approach by Mr. Geoffrey Willis*, the then chairman of Frank Willis and Son (Carriers) Ltd, of Wellingborough, to Mr. Rex Kearsley, managing director of K and 0 Transport Cc. Ltd., of Earls Barton, led to an operating merger and the formation of United Carriers Ltd. in June 1963. UCL now includes nearly 30 road transport concerns, mostly specializing on parcels and smalls. The group operates sortie 550 vehicles and employs about 1,250 people.
It would be surprising if UCL’s rapid development does not continue—any business obviously fitting into the planned group structure would, I suspect, be courted. But Mr. Rex Kearsley, UCL’s chairman, stressed that the holding company’s directors were chiefly preoccupied by the need to consolidate the activities of the group as a whole. All the separate companies are managed by local boards of directors—their collective experience of the highly specialized parcels business is a priceless asset—but the holding company must clearly exercise the co-ordinating and development roles. Major policy matters are referred to the main board.
Northamptonshire has always been notable for enterprising parcels carriers probably because its staple industry of boots and shoes provided a natural need for fast nationwide delivery services to warehouses and retail shops. Firms founded between the wars—PX Transport, T. H. Clark, Valentines, Miles—are still familiar names in local towns though they were absorbed by BRS Parcels Ltd. long ago.
It was logical that post war, as pre-war, the successful newcomers should develop their own specialized routes and traffics. The Frank Willis organization developed services to and from the London area, Bristol and Scotland; K. and 0. operated services to London, Yorkshire and Lancashire.
Most of the companies now controlled by the UCL holding company fit naturally into a non-competitive pattern as regards routes and services so that together they provide virtually a national coverage. (No services operate specifically to Kent, South Lincolnshire or Central and North Wales but there are agency arrangements for traffic to areas beyond the radius covered by the countrywide UCL depots.) The list of acquisitions from the time of the Willis/K and ID merger in June 1963 is proof of the virile expansionist management philosophy. In November the same year, Lance, Midlands and Yorks Carriers Ltd., with depots at Leicester, Bury and Norwich, were acquired. In January 1964, Grants Transport Services Ltd. with depots at Irthlingborough and at Hursley, near Winchester, opened up another valuable territory. Also in 1964 A. C. Pope (Keynsham) Ltd. joined the group and in 1965 R. Knowles and Sons (Helmshore) Ltd., and Harrison and Page Ltd. of Bradford were assimilated. Then 1966 saw the acquisition of H.K.R. (Transport) Ltd., of Little Lever, near Bolton, Willmotts Motors (Howden) Ltd., Howden, near Goole, and the Starmont Warehousing concern, and in 1967 Collins Express Parcels Service Ltd., with three depots in the West Midlands, and East Anglian Carriers Ltd., became part of the family.
Mr. Rex Kearsley told me that most of the firms taken over approached UCL. The reasons varied from concern over death duties if the owners died to the obvious advantages . of amalgamating with a group, thus being able to give greater services. Acquisitions have been made for cash, shares or both.
Several premises in the organization are inadequate for UCL’s requirements. -We sought help a long time ago from numerous estate agents in London where we urgently need larger premises—I’m hopeful that we can finalize the purchase of land shortly”, said Mr. Kearsley.
He explained that new London premises were needed to avoid the need for transhipment at Wellingborough of Northern and some Midland trunk services. “The Willis depot at Plaistow can cope with its own services from Northants but it is too small for all the services we would like to send in direct.”
The main board of UCL meets fortnightly at the Wellingborough offices, which are certainly palatial by road-haulage standards. It would be quite untypical of road transport if all the directors agreed on everything. Mr. Keith Willis, managing director of the Willis Group, said there were many ideas about the economical life of vehicles. Some member firms thought the best policy was to operate light vehicles for three years of 100,000 miles; others felt that five or six years was a reasonable working life with perhaps seven-or eight years for bigger vehicles. “Yet”, said Mr. Willis, “it’s very difficult to get good men tocIrive vehicles more than five years’ old. It’s questionable whether it pays to.keep vehicles a long time.”
The group image may sound an easy thing to promote once a consortium of firms has a common ownership, but there are practical problems not readily solved in the short term. A standard UCL group livery is applied to new vehicles put into service but it will be some years before all the separate company vehicles are in the same livery. Indeed there are strong reasons for maintaining the well established liveries of some constituent companies such as Collins Express Parcels Service or the VVillis Group—both go back several generations. A UCL insignia with the acquired company name may provide a solution to the vexed problem of a standard livery.
Group training needs have been recognized Dy the appointment of a group training officer —formerly the personnel officer of Collins Express Parcels Service. A training prog.amme for drivers, clerical and maintenance ;toffs is being drawn up and this will be mplemented as far as possible at depot level. romising employees of all grades will have Nide promotional opportunities within the 3roup.
Any lafge-scale merger brings with it inherited problems of labour relations, differing wage rates and bonus incentive schemes. The Collins companies productivity schemes with specific rates and job and finish incentives continue. The Willis drivers on the Wellingborough/London services are paid on a trip basis. Other group companies incentive schemes are being studied and ultimately some assimilation may be possible. But circumstances at each depot vary a lot—the motto on this front seems to be “hasten slowly”.
Maintenance facilities are being extended so that there is a well equipped workshop to service local depots in each area. New depots at Durham and Leeds incorporate modern , repair workshops. There is a well equipped repair shop at Wellingborough and an associated bodybuilding department. It is planned to send Northamptonshire-based vehicles for “trial runs” through the new Ministry testing stations at Weedon and Peterborough. The little things will be the problem”, said Stanley Grant, in charge of group maintenance at Wellingborough.
Although parcels organization is heavily dependent on local managerial know-how, efficient operations and economical labour utilization are more readily obtainable from modern premises equipped with mechanical handling aids. The new UCL depot at Leeds, opened in June, utilizes an Acrow drag-link system for the circulation of platform trucks. At Bidfnrd-on-Avon, the Collins Express Parcels depot opened last year uses EMI Robotugs—the first such installation I have seen operating in a parcels depot. A train of trolleys towed by the battery-powered tractor follows a predetermined route round the load ing platform and the adjacent warehouse, stopping at selected points automatically. The guide wire, followed automatically by a steerble sensing fork on the tractor, is buried in the floor surface material, but it is not difficult to plan a new path for the Robotug if necessary.
Any parcels operator brought up in the sack-truck era—still, alas, with us in many depots—could profitably visit the Bidfordon-Avon depot. The system cost some £13,000 to install but, as Mr. S. A. Collins told me, it saves the labour of three porters —say £60 a week—and will pay for itself in three or four years. I have always advocated mechanized parcels sorting and I was delighted to see the Robotug system operating so smoothly. The tractor carries a nylon “antenna” to bring the tug-train to a standstill if a human or solid obstruction is met.) Bidford-on-Avon is a very interesting depot in itself. The Collins organization was fortunate to get planning permission to build there after a manufacturing concern had changed its plans to develop the site, The construction of the depot on the uneven site of an old clay pit involved substantial piling and half the area of the depot and vehicle access road are built on stout concrete piers. This added substantially to the building costs but the depot is well placed to serve the southern part of Birmingham and the Kidderminster carpet trade and it is a real asset to the large village of Bidford-on-Avon. It was pleasant to be directed to Waterloo Road by a housewife who answered my query as to the location with genuine pride. “Yes, I can certainly direct you to Collins Express; my husband works there.”
UCL has no prejudices against using Freightliners and whenever there is a customer advantage in so doing the matter will be pursued. Mr. Kearsley stressed that everything depends upon the timing of the Freightliner trains. “If goods had to be at the new Nottingham terminal by 6 p.m. you’d lose a day. We give next-day delivery from Northants to London and Lancashire services now. When Freightliners will help us give a quicker service anywhere at reasonable cost we’ll look at the possibilities.”
On the advantage to the participating companies Mr. Kearsley was in no doubt that the merger had helped everyone. “By joining an organization able to offer a national collection z nd delivery service the turnover of each company has been increased. As new depots become part of the network inter-depot trunking services will be stepped up with consequent improvement in delivery times. We have not yet fully exploited our growth prospects.”
Mr. P. H. Dodson, the enthusiastic young secretary of UCL, said the company hac 1,000 shareholders. The original issued share capital of £120,000 had now been increasec —Ordinary shares issued totalled £484,322 and Deferred shares £88,888. “Our turnover outside the group, is nearly £3m per annurr —now we have to work towards maximizinc. our profits.”
UCL is not doing so badly in the profit race Profits last year were well up at £304,07 against £266,171 in 1966. This exclude: £60,573 earned by subsidiaries before ac quisition. Treasury permission was secured tc raise UCL’s dividend by 3 per cent to 23 pa cent—approaching the 25 per cent paid ir 1966. There is no doubt that the energetil top management of the group will use thi present phase of consolidation as a platforn for future expansion. Perhaps the success o UCL in a mere five years will inspire simile consortia to be set up in our fragment& industry?
“Mr. Geoffrey Willis retired from the company through ill health in 1968.