The road to recovery

On 8th February 1999, Managing Director Derek Mitchell’s new specialist palletised distribution business, Caledonian Logistics, was founded, alongside a client base that had been developed over the years. Initially starting with ten staff and six vehicles, today it can now boast a fleet of 165 vehicles, including 72 trucks, 85 trailers and some vans/cars; and strategically placed depots in Cumbernauld/Inverness/ Oldmeldrum and Kintore which are able to service large parts of Scotland. With a total warehouse space of 113k sq ft, the company’s turnover is estimated at £13 million for the year 2017.

The company provides deliveries for clients, including working with Palletways, Europe’s largest pallet network. As well as this, Caledonian is also part of Partnerlink, a system that allows for better communication with businesses. Derek has a firm belief that these kinds of alliances are vital: “It’s all about being in the club, with a certain level of service expected. Daily inbound trucks come into Lichfield and there will be freight that has to be delivered the same day. If it doesn’t get out on time, people don’t get paid, so this tends to narrow the thought process,” he quips. These collaborations are clearly working, as the organisation maintains steady growth: “There is a widespread base of around 500 to 800 trading customers, with some working with us every day, others once a week and so forth. For the blue-chip people there is constant trade, this can include storage, distribution and overnight trunking, essentially it is tailored to suit individual requirements.”

In order to keep on top of this, there has been a drive towards more investment in staff, facilities and vehicles: “We have a constant renewal of trucks, mostly these are on contract so it is important to get any vehicle replaced before it goes out of service. With regard to the workforce, it’s good to get qualified and experienced people but you can’t always get that, so it is sometimes necessary to promote from within. In terms of facilities, our Oldmeldrum Storage Facility is well placed with a 7.2 acre site, available exterior space and sometimes limited interior space dependant on seasonal business trends,” Derek details.

Another reason for this renewal is a drive toward a more energy efficient business: “One reason we renew in two, three and four year cycles is because there is a drive towards better fuel efficiency. The company spends £60,000 a week on fuel, so there is the desire to get as much of a return on this investment as possible,” he insists. With a mix of leased, hired and purchased vehicles, the company aims to maintain the best quality by using leading manufacturers such as Mercedes, Scania, DAF and Volvo, while always being on the lookout for any upgrades that could potentially give the organisation an edge.

There is also a sense of renewing fortunes for the industry, after Caledonian’s emergence from difficult and unfortunate circumstances. This is impressive in the current economic climate in Scotland and around the North-East. This is because it is in an area where oil is a massive part of the economy and it is currently in the midst of a downturn, something that Caledonian has managed to defy: “The turnover has been pretty constant, and that was not a guarantee, given the circumstances. There is always the feeling of having a finger on the pulse, without a lot of fluctuation over the years.”

While running a business can be complicated in a number of ways, in a sense one way that this consistency has been achieved has been through a very level-headed approach: “There is always an awareness of aiming for certain budgetary targets, looking at each one on a month-on-month, year-on-year basis. In order to keep this going the client base needs to be retained. This can be achieved by providing a service that maintains high standards, while still offering a reasonable price,” he firmly states, before summing up the process even more succinctly: “Carry the freight you can deliver, it’s like a taxi service – roll up at one end, empty at the depot, then deliver.”

Now, not only is the work still coming in for Caledonian, but it can offer employment, with business moving forward and thriving in the local area. If the company can continue this, then Caledonian Logistics will continue to deliver for its customers and hopefully provide inspiration for the would-be entrepreneurs and owners of the future. But how can this keep going and what can be done to maintain growth? What is the secret? In Derek’s own words, there is only one answer: “Head down and go forward!”

Caledonian Logistics
Specialises in palletised distribution
A fleet of 165 vehicles including trailers
Links with Palletways and Partnerlink