Following a long history of success in logistics, transport and distribution, the Widdowson Group is now widely recognised as much more than a third party logistics provider – rather, it’s an end to end supply chain provider for manufacturers and retailers in different sectors, offering its established client base a wide portfolio of logistics-related services.
Over the past few years, Widdowson has been involved in extensive diversification, providing added value services for customers. Springing from its core logistics business, these added value services include contract packing – a major growth area in its own right, pallet refurbishment, garage services and driver training.
At the same time Widdowson has strengthened its service proposition with the reformulation of its commercial team, a major investment programme and an improved cost model, which has made the business more competitive in today’s tough business environment.
This hard headed approach is clearly paying off: in the last few months the Widdowson Group has seen a remarkable turnaround for its logistics services business, winning new contracts worth over £3m and renewing existing contracts worth £5m in the food and packaging sectors.
The company puts its success down to the combination of a forward thinking strategy and good old fashioned hard work looking after the customers’ requirements, buoyed up by the good fortune of having customers with high volumes of promotional activity around the World Cup, and needing Widdowson’s support in their supply chains. John Hawksworth, Commercial Director at the Widdowson Group, spoke to Warehouse & Logistics News.
Warehouse & Logistics News – First of all, John, when did you become Commercial Director of Widdowson? What were you doing before?
I joined in 2000. I was previously General Manager of DFDS Transport’s international hub in Tamworth.
WLN – What does your day to day role involve? Do you spend much time talking to customers?
My day to day work involves monitoring our commercial team, which includes two New Business Managers and two Key Account Managers, and working with the board to run the business, alongside our MD, Finance Director and General Manager. I talk to customers on a daily basis and have close relationships with many key clients.
WLN – When was Widdowson Group founded? Who owns it now?
The roots of the business go back to the early 1900’s, with a horse and cart operation delivering coal in Leicester. It was set up in its modern form in 1975, and is still owned by descendants of the original family.
WLN – How big is Widdowson Group in turnover, vehicles, staff, distribution centres and depots? Do you operate outside the UK?
Widdowson Group now has a £24m turnover, with 130 vehicles, and 200 trailers. We employ 340 people, 150 of whom are drivers. Our headquarters are in Glenfield, Leicester, and we have two other distribution centres in the Leicester area.
Our international freight division services overseas customers through partners and brokerage. We handle import and export by air and sea.
WLN – Can you talk us through how Widdowson is organised into divisions?
Our four main divisions are UK transport, providing full load and groupage; logistics warehousing, covering ambient storage at our main site and two offsite distribution centres; contract packing and added value services; and international freight. We also have subdivisions in commercial training and garage services.
Commercial training provides internal training for our own drivers and driver CPC training for other people, with drivers becoming DSA-qualified to LGV standards through one or two week courses. Our garage division services our trucks and sells its services commercially to other fleets.
WLN – How big are each of these divisions in turnover?
Our three biggest areas are UK transport with 55% of turnover, warehousing with 30%, followed by contract packing and added value, with 10%.
WLN – Which ones are growing fastest?
Contract packing and added value is growing fastest, reflecting the fact that we’ve put a great deal of time and effort into it. Logistics warehousing will maintain steady growth from here. We want to maintain our core businesses of transport and distribution as our major strengths and selling points.
WLN – As a group, you have an impressively diverse business. What is the ‘golden thread’ running through your different operations?
The common factor linking our services is our commitment to delivering cost-effective, logistics-based solutions backed by first class service, ensuring clients increase their profitability without compromising service levels.
WLN – Where do you see yourselves in the league table of third party logistics providers?
We’re not in the Premiership, but in the top half of the First Division. We want to continue to diversify into other areas.
WLN – Given the breadth of your services these days, is it fair to call you a 3PL, or would you prefer another term?
We’re not a 3PL as such – our strategy is to be end-to-end providers of full solutions covering import, storage, contract packing and sending goods out. Our approach is to sell a wide range of services to a customer and cover their whole supply chain.
WLN – I understand you have improved your cost model and made yourselves more competitive. How have you achieved that?
We embarked on a business review 18 months ago, with the appointment of our first Financial Director, Arnaud Arainx, who was formerly with Norbert Dentressangle. We have reviewed our cost structure and renegotiated many of our supplier deals. We were also using additional warehousing, which we have cut out. In total we have removed £2m per annum from our cost base.
WLN – You also recently reformulated your commercial team to reflect the changing nature of your business. How are they organised now to offer customers your services as a one-stop shop?
By way of background, before the recession struck, our business grew from 2000’s £9m figure to around £25m. This happened organically, largely on the back of existing relationships: we’d never invested in our commercial activity before. Sales growth is the sure way out of the recession, and we’re now looking at further strengthening our commercial operations.
WLN – Can you name any customers who use several different Widdowson services?
To take three different examples, Ospelt Pet Foods Company is based in Lichtenstein and supplies own label products to UK retailers. We import its goods, store them in our warehouses and carry out packing exercises, before supplying the finished products to Ospelt’s customers.
Omni-Pac produces different kinds of egg packaging to UK customers. The product comes from Germany: we call off the stock from our warehouse and distribute it.
Halspan Doors are produced from different manufacturing points: we receive them, store them and supply them to Halspan’s UK distributors.
WLN – Do you offer pallet refurbishment, garage services and driver training as ‘stand alone’ services to the wider world, people who aren’t existing logistics customers?
We do – in our commercial training side, we advertise our LGV training and courses. Ultimately it’s a good avenue to recruit new drivers.
WLN – You’ve also recently carried out a major investment programme. Which aspects of the business have you invested in?
We’ve invested substantially in upgrading our contract packing operation to reach BRC accreditation standard, which was awarded at the end of 2009. This included refurbishing our 60,000 square foot facility at Glenfield.
WLN – As part of the investment programme, I gather you have also invested substantially in IT. What enhancements have been made as a result, and what are the benefits to customers?
Yes, we’ve invested heavily in IT: 18 months ago we implemented full satellite tracking of all our vehicles using the Masternaut system. We’ve also got a fully integrated system from Roadtech, which covers WMS, and traffic and garage management. The system includes the ‘GreenerFleet’ subsystem, which monitors vehicle status and driver performance.
Customers have access to the IT system and can see what’s happening to their deliveries. They can receive real time information and KPI’s on delivery.
WLN – In your core area, logistics services, I gather you have won a major contract from Pearson Shared Services for the UK-palletised distribution of Pearson Education books and Penguin Books. Can you tell us about this?
Pearson took us on to handle delivery of all their books from their distribution centre in Rugby: we deliver direct, collecting on day one for day two despatch to all high street retailers.
WLN – Are you looking to handle more publishing-related contracts?
It’s our first toe in the water: the work fits our network very well, and now we’re tendering for another publishing company. It’s definitely a growth area.
WLN – I understand you have also won the haulage contract to handle LINPAC’s APEX pallet racking, shelving and accessories. Again, can you tell us about this?
LINPAC was a long established customer of ours: we lost them to tender three years ago, but since we’ve reduced our costs, we’ve won them back again. We distribute all materials handling equipment to LINPAC customers on multi-drop deliveries from their manufacturing plant in Milton Keynes: we take the accessories to the distributors, and our full load fleet delivers the racking in trailers to their installation teams. Warehousing and logistics for materials handling and warehouse products is certainly an area we’ll be exploring further.
WLN – Are there any other major logistics contracts that you’ve won recently?
There’s nothing I can announce just yet, but we are in the latter stages of several interesting opportunities.
WLN – Your contract packing division sounds fascinating, particularly as it’s taking you into the manufacturing sector. When did that business start? How did it come about?
When we got involved in warehousing initially, we provided the basic warehousing services, with some picking, then started stickering and so forth: there was always some added value work, but the demand grew for contract packing services, from food, drink and FMCG companies and retailers.
Consequently, we set up our stand-alone contract packing area at Glenfield in 2008, and can work 24 hours a day at 24 hours’ notice.
WLN – Boots recently appointed you to contract pack two of its Christmas 2010 ranges, one in haircare and one in toiletries. Can you tell us about that piece of business?
Boots has always been a dream customer for our contract packing side. Once we got the BRC accreditation the company invited us to tender and awarded us these two contracts. Our business development team is now looking at work in similar sectors, and it’s an area we’d like to take forward.
WLN – Are you looking to further expand your contract packing services? Can you see contract packing one day being run as an altogether separate business?
We’d like to expand operations on the present site, as the contract packing and warehousing set up we have there is ideal. As the business grows we could move storage of finished goods into our outer DC’s, both within five to ten miles of Glenfield. Whilst it’s set to grow substantially, I can’t see contract packing being a separate business for the foreseeable future.
WLN – You’re exhibiting at the Easypack Packaging Show. What will you be presenting on your stand?
We’ll have a full display of samples of our work, to encourage people to talk to us. We supported Easyfairs at the NEC for two years, but it’s our first time in London. With our membership of the British Contract Manufacturers and Packers Association, Easyfair has been very useful for awareness and leads.
WLN – You’re also exhibiting at IMHX in November. What will you be presenting there?
We were at the Food & Drink Logistics show in March: we got some good leads from it, so we’re going to be in the Food & Drink Logistics pavilion at IMHX. This will help us establish awareness of our food and drink supply chain proposition.
WLN – What quality accreditations do you have as a company? What industry standards do you work to? Are you members of any industry bodies?
We have BRC accreditation, as mentioned: we also have ISO 9000 for the whole group, and Investors in People. We’re members of the RHA, UKWA, BCMPA, the Driver Standards Agency, British International Freight Association and British Retail Motor Consortium.
WLN – You’ve clearly come through the recession in very good shape, which is great news for you, but it’s been a hard time for a lot of people. Where do you see the logistics industry in general going?
Contract prices are keen and there’s plenty of competition. We will all still have a challenging time over the next year, and it is very likely that there will be more casualties.
WLN – When do you see things picking up?
In a year to 18 months there should be more work around, but there will be fewer logistics companies on hand to do it, so rates should harden.
WLN – Do you think logistics companies will have to become broader in their service offering like you have, in order to prosper?
Yes, I do: there’s little margin left in pure warehousing and logistics. To survive and attract customers, you have to diversify and add value. Since 2009, we’ve been operating an IPP pallet pool on site at our headquarters, and currently handle 1 million pallets a year for IPP through our depot.
WLN – Finally, where do you see Widdowson Group going from here?
We have a strategy in place to grow our turnover to £30m in three years’ time. We will continue to attract customers wanting end-to-end solutions, enhance our commercial division in sales and marketing terms, and add value and diversify into other areas. Geographically we’ll always be based in Leicester, but we might establish a regional presence.
We’ve no current plans for acquisitions, but ‘never say never’! Meanwhile we’ll go on growing with the existing and new customers we have coming through.
The Widdowson Group
Tel: 0116 232 2666