Options split over takeover rumour.

Members of the various pallet networks are divided over the effects a potential takeover would have on the operational and profitability of their particular network.

Pallet network members appear to be divided in their views on the takeover of one of the leading networks by one of the logistics giants.
Some larger network operators worry about a conflict of interest or changes in the view on profit margins, while others see no threat.
The comments were made following claims that a takeover, probably involving one of the “big three” independent networks, is imminent (Motor Transport last week)
Julian Richards, managing director of Palletways member AK Worthington, says able with such an acquisition because we compete with the (large company) 3pls on smaller contracts.
“Also a 3pl would be interested in a pallet network for profit. They could use the network to dump in work from the bigger contracts, but at lower rates.”
Andy Meade director of Palletways’ Just Vans South West says: “I’d be very disappointed if the network we are part of was taken over. Yes the volumes would grow but it would become all about turnover and not profitability.
“The 3pls work in a cutthroat area and to be more competitive they would reduce rates in the network. I wouldn’t be surprised if rates went down by 10-15%.
We like the way things are going at the moment, the network is growing organically, but if an acquisition was to take place, it would all come to a halt,” he fears.
Andy Hawkins, operations director of page group, a member of member-owned PalletForce, says any acquisition would be accepted by members as along a the network continued to operate with the same standards and he does not believe customer-poaching would be an issue.
“There wouldn’t be too much of a threat of the 3pl stealing customers because the hub does not hold that information; but there could be a problem if the 3pl flooded the network with volume from its big contracts because it would raise service level and capacity issues for members.”
At Reading based QTR Transport – a Palletline member – MD Paul White says; “When business Post took over Weavers, there was no real change and the members seem happy- so I think it really depends on how the 3pl would decide to run the network.”
And David Bartrum, director at Norfolk-based Bartrum Road services (a Pallet-Track member) agrees. “I don’t see the potential takeover as a major concern for network members. The central hub does not have access to members’ customer details, and it could be good news for network members, through increased volumes and a more financially secure background,” he says.
Andrew Spencer, MD of UPN, says: “Any acquisition could see the network would add to its strengths and build on its weaknesses. For members it would be very worrying.
“We’ve already had the parcels people come into the sector, which had added to the diversity of the sector.
“A 3pl entering the sector could be a good thing, with more volume; or bad, if they creamed off the best bits.”