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Rising Fuel Costs contrbute to UK Hauliers Demise. |
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Ramage Distribution is one of the larger UK hauliers, employing over 390 people and turning over last year £30m. Operating on a much larger scale than most of the UK Courier companies, but within the same marketplace, and facing the same challenges as couriers. This week saw Ramage Distribution enter receivership, with trading factors, and notably the rising fuel costs, being listed as primary factors in the downfall of the business. Almost everything that everyone in the UK buys, wears or eats has been delivered. The costs of delivery and haulage impact on every single person's lives, but it is an issue that the average man in the street doesn't perceive as having a direct impact on them. When the price of fuel goes up people tend to think about the price of a tank of petrol, not that that's going to increase the price of a loaf of bread, a bag of potatoes, or even the price of a plant from a garden centre.UK Couriers & hauliers are operating in one of the most challenging market places. Their customers are either the large businesses who are able to impose their delivery prices on the couriers, or smaller businesses fighting to keep their delivery costs as low as possible to compete with the big boys. The large haulage businesses, supplying the largest retailers in the UK frequently are unable to pass on the rising fuel prices, and end up with their profit margins getting squeezed more on every fuel price increase. And the costs of operating a courier business in the UK just keep on increasing too. With tolls, expanding congestion charging zones, increasing insurance costs, and of course, fuel. Couriers face price conscious customers, who look to shave every pound possible off their rates, but couriers also have to take into consideration the cost of running a half empty van, And this results in a trade off, the loss of which is usually the profit margin.Couriers give their customers contract rates, so that the customer knows where they stand, and can make informed decisions about the pricing and sales strategy of their goods. But with the fuel price increasing on almost a weekly basis, this leaves the courier absorbing the loss. And a few pennies on the price of a litre, or a couple of pounds on the price of a tank, can equate to over a hundred pounds a day for a firm of couriers running 40 vehicles. They can't go back to the customer and ask for a top up, you can't renegotiate prices every week. So who is it that takes the hit of these fuel price increases?We know. And the industry will not be able to continue to do so for much longer, and Ramage is a warning light. www.boxby.co.uk
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