Aceona supply chain management

Amidst the daily gloom we have unearthed something very positive: our sources suggest that formal consent will soon be given to the clearance of the Ipswich to Peterborough railway line for the running of high cube (9′6″) containers on standard wagons.  Whilst this is long overdue it is nonetheless very welcome as the alternative for a lot of traffic on the Felixstowe to North East corridor has been either specialist railway wagons or road haulage.

Given that, in our experience, the use of rail on this corridor can be in the region of 20% cheaper than road haulage - cost differentials which inevitably find their way into consumers’ shopping trollies - it tends to highlight the necessity for taking a longer term and more holistic view of transport infrastructure investment.  Whilst the effects of Dr Beeching’s axe have been reversed on a very small scale the simple fact is that the UK railway has a finite capacity and squeezing additional capacity from the network, especially for freight - even higher speed freight such as 75mph container services - is a dark art.

Despite ever increasing fares, volatile fuel costs and the grind through the congestion on most roads, rail travel has seen a remarkable renaissance in recent years; operators have, understandably, sought to fulfil their franchise obligations and lay on more and faster services all of course placing pressure on capacity and ensuring that freight paths are harder to find.  The debate about the economic value of a track path has been ongoing for some years but whether this will manifest itself in a more balanced approach to freight pathing remains to be seen.  Perhaps it all boils down to robbing Peter to pay Paul, but in the meantime both we, and our customers, are delighted with the latest news.

Firstly, on behalf of all at Aceona Management we wish all our website visitors a very happy and prosperous 2009.

To be fair the year hasn’t exactly got off to a cheery start with newspapers seemingly jammed with tales of woe, business failures and umpteen thousand heading for the dole queue. It’s difficult for most of us to comprehend exactly what has happened to bring us to this particular juncture; once proud companies, household names for many years, brought crashing down whilst others hang in there by the skin of their teeth. The scale and speed of this economic downturn has indeed caught many on the hop and struggling to understand how to extricate themselves or where to go next: the banks have put up their shutters and the ready and easy credit of only a few months ago has dried up with disastrous consequences for many businesses; sales have crashed and costs continue in an upward direction.

But is it all gloom and doom or has somebody fired the starting pistol on what is undoubtedly a challenging but exciting race? Personally I would suggest the latter; UK plc is placed smack bang in a window of opportunity the likes of which we may not see for a long time – if ever again. It’s not just the UK that’s nursing severe economic bruises or feeling the chill winds of recession, so doesn’t that suggest an opportunity for the economy that looks beyond the here and now and positions itself to reap the rewards of the future?

The simple fact is that British businesses DO have an opportunity. Being supply chain managers we readily subscribe to the view that the supply chain is THE competitive element for the vast majority of manufacturing and retail businesses: the revenue from of a tin of beans may be reasonably fixed in terms of what shoppers are willing to pay, but the cost of getting that tin onto the shelf in the first place is another world for those willing to look carefully and be prepared to do things differently in order to maximise returns and/or reduce dependency on the banks.

The snag really lies in the high proportion of British managers who are unwilling to contemplate change: far too many sit back in their comfort zones or bury their heads in a bucket of sand and pray that when they emerge the sun will be shining and everything will be fine and dandy, just as it was before the storm clouds appeared. I think they need to wake up; it really is change or die.

Could we be heading for an era where the small business is king – flexible, lean, cost and service focussed and able to take on the big boys in key market areas? In some respects it’s very much like comparing a small speedboat with a supertanker, one turning on a sixpence and the other lumbering on for miles before anything happens. I remember the tale of the “Turbinia” – the small craft wrapped around Charles Parsons’ steam turbine engine which ran rings around the British fleet at Spithead just before the First World War much to the chagrin of empurpled admirals ….. but the turbine won the day and it wasn’t long before that method of marine propulsion was the norm.

There is a significant overlap between this tale and the modern supply chain.

Over the coming months we’d like to open our website to debate and to offer advice and suggestions as to how companies can replicate the good old “Turbinia” and become much more agile to face the challenges ahead of us. We’ll be talking about how the 4PL offer can reduce costs (and our customers will readily testify to the savings and efficiency improvements they enjoy) and how the 5PL offer will usher in even greater economic advantage for UK industry. So please send in your comments and questions and we’ll do our best to answer them as quickly as possible.