Distributing the goods
The last three years have been quite eventful for Multimodal Logistics, a shipping and transportation services provider, based in Felixstowe, Suffolk. According to the words of General Manager Tim Wray, the company has been like a phoenix rising from the ashes in this period, due to it being a part of an elongated merger and its subsequent growth in business outside of its core. Here is his account of Multimodal Logistics’ latest developments: “We were a subsidiary of China Shipping European Holdings Ltd and up until recently following the start of the merge with another shipping line, Cosco. We were the sole logistics provider for China Shipping for the UK, incorporating road, rail, and some feeder movements, and with the joining of the two companies we started to carry out a similar function in the new business, alongside the logistics operation provided by Cosco Shipping. The merger provided an opportunity for Multimodal Logistics Ltd (MML) to expand further, because in our position at that time, if we wanted to grow and establish ourselves, we had to go out into the market and attract new business from customers away from our core, which we have managed with continued success,” he reasons.
Tim identifies the particular area of interest for the business in the changed environment: “We now want to focus on widening our customer base, outside of our shipping line commitments. To do this, we are developing logistics solutions for third parties, and even though we still have a long road of growth ahead of us, in the last few years we have seen a 30 to 40 per cent third party year-on-year revenue growth. We are now able to compete in the open market with general haulage contractors in the container market, moving cargo from almost all major UK ports through the UK and into Ireland, using road and rail options.”
One of the reasons for Multimodal Logistics’ continued success, is its location. Tim insists that being based in Felixstowe, which hosts the biggest container port in the UK, is one of the explanations for the company’s enlarged geographical footprint. He also places emphasis on the solid infrastructure it can rely on that facilitates the shipping and transportation works: “Our inland trucks are based on railheads, and we have positioned vehicles at the rail terminals in Manchester, Yorkshire and the Midlands, so when the trains leave the ports for their inland destinations, we are ready to meet them and process the cargo quickly.”
The road and rail combination Tim mentions, appears to be one of the key strengths of the company, giving it the edge over the competition. “Because we are able to offer this type of combination, we can help reduce the costs for customers and move their containers more quickly. The ports are very good at charging customers after a certain amount of time, so we offer to move the containers inland within that free period, and deliver them directly by rail. We can also do this at volume, which means that we are capable of moving considerable amounts of cargo, even at short notice,” he comments. “Furthermore, today’s shipping line vessels are getting bigger and bigger, which leads to everything arriving at the port in one huge spike. This gives us a very short period of time to unload everything, but we work very hard to provide quick and efficient solutions and cope with the work coming at these peak times.”
Tim elaborates on his previous point, as he offers a valuable insight of the condition of the logistics industry: “It has always been a financial challenge for customers, because containers come all the way from the Far East at very competitive rates, and what the clients want, is the UK distribution to be as cheap and effective as possible. The problem with the UK infrastructure is that the haulage resource at peak times is minimal. This means that you need to be as precise and efficient as you can, in order to get the containers moved quickly, and the cargo delivered. I think that we have developed almost a niche service to our customers, being able to offer that speed and quality.”
Multimodal Logistics has committed itself to regularly upgrade its fleet, in order to add higher value to its services, and infrastructure is one of the areas where it places significant focus. Tim explains: “We invest a lot in vehicles. The company has established an excellent working relationship with a truck manufacturer who provides all our trucks. In 2018, we will be replacing some of our vehicles that are coming to the end of their natural period with us. It needs to be mentioned, though, that because trucks are expensive to own and operate, we also invest in our subcontractors who work with us directly. They dedicate themselves to us in providing service to our customers, and in turn, we give them business, so both parties can grow, going forwards.”
Despite describing 2017 as a difficult year for all the shipping lines due to new shipping alliances being formed early in the year, and the initial insecurity this led to, Tim expresses his satisfaction over how Multimodal Logistics fared in the past 12 months: “We had a successful year, particularly with our third-party business, as the customers found out that we were able to react quickly to their requirements. In addition to this, we also optimised our operations in Southampton and London Gateway, as well as in Felixstowe, which is where the key business comes through.”
It is not that the company is running short of ambitions for 2018, and Tim is confident that it will increase its turnover, compared with its result last year. “We are also planning to grow our third party proportion this year at a greater rate than 2017. It is also crucial for us to try and become more independent in what we do and how we do it, and to further business streams, which will provide cost-effective options for all of our customers. Diversification of services is a big part of our plans for achieving sustained growth.”
Towards the end of our conversation, Tim opens the discussion of the need for more professional drivers to be engaged in the industry, and suggests that their dwindling number is a concern for the normal working operations. “There is a driver shortage in the UK. It is hard to find suitable drivers who are able to perform to the standards and the work requirements of the industry,” he notes. “Truth being said, it is not a very popular job for a PlayStation generation. Drivers often work long hours, day and night, but they are needed, because they move the cargo we all later buy in the shops. The UK does not have a great record of developing new drivers, as a whole. It is true that some companies have already started to do that with relative success, but there is no volume in it. There is a significant amount of foreign drivers in the market, but the uncertainty around Brexit means that we do not know what level of employment resource will be left after the negotiations are over. Another issue is that a lot of the drivers are in the latter years of their careers, and there are more drivers going out, than coming in. We are a nation based on import and export, so we need these people to move the goods around, otherwise the infrastructure will start to struggle,” Tim concludes.
Multimodal Logistics Ltd
Container Logistics service provider
Significant revenue growth outside of its core business in the last three years
Delivering cargo to anywhere in the UK