Import container volumes are down and margins are tighter than ever, says one of the West’s oldest wharf carriers
Stevenson Logistics has been involved in the wharf cartage business at Fremantle for 80 years, and has seen plenty of highs and lows in that time.
The good news is that official long-term forecasts for container trade are ever upwards for all Australia’s ports.
And containerised agricultural exports are strong out of Fremantle.
However, with the end of the mining construction boom in WA, overall import container volumes have dropped there by about eight per cent for the 12 months to September, according to figures quoted by Stevenson.
So competition is tougher, and rates and sales are under pressure while of course costs keep rising.
To help keep on top of things, Stevenson has developed its own computer software system to keep track of containers, fleet servicing schedules and just about everything else too.
Driver fuel usage, idling times, hard braking events, revving, maximum speeds and so on are monitored, and the company maintains drivers enjoy the competition of trying to increase their rankings.
They are paid above the award on individual contracts, and can also earn bonuses partly depending on what the computer spits out.
Meanwhile the software can also measure the costs of every leg of every job – depreciation on both prime mover and trailer; tyres; rego; insurance; wages and so on.
That means the company can put in accurate quotes that will make, not lose, money.
“There are tight margins and definitely stiff competition in this current market,” says Ben Higgins, chief executive officer of Stevenson Logistics.
“A lot of the clients are asking to re-tender jobs, and it’s essential that when we go back with prices that we are confident with, we can also be confident we are making a profit, and not in effect buying work.”
Adds general manager of transport, Darrin Smith: “Your shippers are pushing for ‘cheaper, cheaper.
“Unfortunately there are a lot of transport companies out there that are getting more desperate, so they’re actually dropping their rates in dollar terms, so the shipper goes ‘you beauty’ – they’re not going to knock it back.
“But we understand our costs, we have good information, whereas a lot of them are just going on ad hoc, gut feelings, and wouldn’t have a clue whether they’re actually making money or losing money.
“It’s your smaller operators that just shoot from the hip.”
Stevenson has more than 20 prime movers, most of them Freightliners.
The company also uses up to half a dozen subbies and has large undercover and container storage capacity its big new site at North Quay, next door to Toll.
CHAIN OF RESPONSIBILITY
Stevenson says WA’s new COR regulations on weights and load restraint are having an impact.
Close to home the company has put all its drivers through load restraint courses.
On a wider level, the company says the new legislation has prompted those exporters who were previously doing the wrong thing – and often leaving drivers to wear the rap – to declare their weights correctly.
“If the driver gets pulled up overweight, and it’s not declared correctly, they (Main Roads officers) will go back to the person who declared it and they’re in trouble,” says Smith.
“Import is a different kettle of fish because if it’s coming from China they’re not too restrictive on what they put down, so shipping lines just give you what they get, and we’ve just got to double check it.”
Check out the feature on Stevenson Logistics and its sister company, rail operator Intermodal, in the December issue of Owner//Driver.