Maxi Haulage – Easter Update

Each week, our MD updates staff on events in respect to the Coronavirus crisis

This is his most recent update:

We are now around a month into the crisis, again I want to bring you up to date with what’s happened so far.

At the outset of the Coronavirus event, I set myself a number of targets I believe making good progress on all of them:

  1. Lots of dialogue with customers to try and get ahead of events
  2. Become part of contingency planning with customers
  3. Feed as much information to customers quicker and better than anyone else
  4. To be hard nosed and commercial
  5. Get traction costs out in line with views on business levels I.E not waiting until business dips
  6. Get additional revenue in to support service from existing customers the additional costs especially Ireland
  7. Create an environment where nothing becomes a surprise for our customers
  8. Communicate with all our staff and customers at least weekly
  9. Create a log on website have had lots of positive feedback on it
  10. Aim to do all of above without creating long term damage
  11. Also use the opportunity to conclude account/purchasing/invoice queries
  12. Finally monitor and challenge aged debtors

The key thing you need to understand is there are no correct answers to anything, I have to take educated guesses at what is likely to happen, I can only do that with substantial dialogue with customers.

So lets update on a few specifics.

By Tuesday next week we will have furloughed the following:

22 drivers

8 warehouse/yard staff

25 office staff

This will of course create extra work for payroll who are already very busy with all of their work, most of which is unseen – I’m sure you will all join in with me in thanking them for their fantastic efforts. Another group that have had an increased short term workload is our IT department, who have faced very different challenges compared to the usual with so many working from home, so again many thanks. The operations teams, well done you, have really risen to occasion.

Likewise with the admin teams at Irvine and depots, again great work and dedication, I like receiving emails from people who are working into the evenings and just shows me their dedication.

We have had to lay off substantial amount of sub contractors, something approaching 70 vehicles a day. On an annualized basis that means around £6.7 million worth of costs.

That will eventually mean less work re processing and paying invoices, I also think we may have to lay off more.

Shipping volumes after initial upward movement are now in a downward cycle, revenue is clearly falling. One example from Week 3 in March to Week 4 in March, groupage revenue was down by 33%.

Ex Ireland, the volumes are very light. To counter this we have agreed extra charges with customers especially going to Ireland, without the extra cost we couldn’t do the business,

It is imperative, if they don’t physically accept the charges as the people who process the invoices are not always the same as those who have agreed the charges, when invoicing despite agreeing at outset, we challenge in real time

Situations like this can easily get out of control, on our parts business there has been a gradual drop in business levels, this will most likely intensify in coming week. We are therefore adjusting the amount of vehicles we use downwards.

On Wrexham, March revenue held up well but has had a major drop now in April which will get worse, the reason being new work re likes of new houses has just stopped.

Our round trip business to Ireland is going well, our domestic full load business is struggling due to lack of back loads hence restricting what we take on, CVD business is now closed for time being.

On positive side we have returned save HIABS, all rental vehicles and have still 2 trailers left to return, Our engineering/tyre costs will be significantly down in April as we have parked up so many of our own vehicles and no mots.

So everyone is clear we are not at the bottom of impact yet I believe things will get much quieter post Easter, outstanding queries are at an all time low, we will need to keep it that way, aged debtors are in a reasonable position, one of reasons I have been so forceful in trying to resolve queries is to protect our cash flow situation.

Key for business is I take as much cost out of business inline with revenue reductions, I need to get speedier data on revenue each week to ensure I am making the right decisions

I am very proud of work we are all doing we have had some wonderful comments on our service. I don’t want to be full of gloom but it is important I am honest with you, we are not anywhere near the bottom of the cycle and I will need to get more cost out for the business to keep its head above water. There will be casualties in the market without government support I am determined Maxi will not be one of them.

I would encourage you all to write to your MPs asking for help for our industry – If any of you have any concerns re things like social distancing/cleanliness of washrooms etc raise with your manager if not resolved liaise with me

These remain very uncertain times and I have to review our overall resource levels daily and remain in daily contact with major customers, We are very lucky to have a core of really good staff/ managers/drivers/warehouse staff. Your efforts in this last month have been superb

We are also very lucky to have such a robust and understanding customer base.

Again, anyone with any questions, I’m happy to answer.