Transport Management of Herne Organics at North Kent - Case Study Example

Executive summary As a larger vegetable and salad producer, Herne Organics has two options in its transportation system. The paper examined both options and it was found that outsourcing the company’s vehicle fleet would be the most viable solution. In order to accommodate the new clients within this transport system, it will be necessary to make contacts with them. Sound email and telephone service management will be imperative in this process. In order to effectively manage deliveries, it will be imperative to use vehicles with refrigeration facilities, adequate room for cleaning, strong floors that can withstand pressure and those ones with speed governors to minimise speed. Herne Organics will also have a distribution pattern that is determined by the proximity of the respective clients. Shifts for deliveries will be organised around this concept. Lastly, a lot of support will be needed in terms of the trained drivers, efficient mechanics and experience in supply chain management. 1.0 Introduction The latter essay is an examination of the transport options available to a company that specializes in organic vegetables and salads. This business was initially a small one, however, following re-investment and expansion in the sector, the company now focuses on production of organic products. There is a need to look at some of the avenues available to the company in terms of vehicle fleet management. Additionally, financial and operational challenges will be examined with strict adherence to the UK vehicle and operator serve agency’s rules and regulations. 2.0 Opportunities and problems associated with two differing operational scenarios Herne Organics has the option of either outsourcing or owning their fleet of vehicles for transportation. If the company chooses to outsource this business function, then it stands to benefit from the great experience that the transporting company will have. Since such experts have worked with so many other businesses, then they are likely to develop solutions that are well suited to this company. (Emp, 2007) If the company chooses to own its fleet of vehicles then they may have to dedicate a lot of finance and time towards running this fleet. By outsourcing, the Kent Limited will be spared from this hustle and bustle. Outsourcing also, transfers some of the risks that arise out of owning one’s fleet. This is usually because of the need to maintain an operational lease. Additionally, vehicles require a lot of maintenance and this eats onto the company’s profits. By outsourcing, the company can eradicate this issue. If the company opts to own its fleet of vehicles, it would have greater control over their transportation functions. Many external companies may impose undue rules on the number of times that the vehicles may be utilized or the period of duration of the contract. However, all these problems are eradicated whenever a company opts to handle its own transportation problems. It should also be noted that choosing to outsource the transport function could create a scenario in which there are communication barriers between Kent Limited and the company offering the outsourcing service. If Kent Limited fails to do adequate research about this option, then they may get a company that makes independent decisions without consulting them and this may cause a lot of friction between the two parties. (Fisher, 2004) However, outsourcing the transport function can also go a long way in reducing certain miscellaneous activities. For instance, drivers will have to be trained by the transport provider rather than by Herne Organics. Also, the company can be spared from insurance costs that come with owning a fleet of vehicles and they can also minimize the risk of getting into accidents since drivers will be well trained and prepared for the tasks that lay ahead of them. There are a number of dynamics that are going on in the vehicle business environment today that could place Kent at increased risk if they own their own fleet of vehicles. For instance, they may want to resell their vehicles or change them. This can be extremely problematic if that vehicle‘s value have gone down. Therefore, in such circumstances, the company is likely to lose. It should also be noted that in certain cases when vehicles need repairs, then the fleet management company will be responsible for this rather than Herne organics itself. It should be noted that one can be fined for infringing any of the terms of the agreement made with the outsourcing company. According to the Vehicle Operator service agency’s rules and regulations, businesses need to meet their end of the bargain by sticking to the lease agreement. If this is not done, then the transport management company can impose fines on the offending party. All in all, since Herne Organics is a relatively small company, it would be advisable for it to consider outsourcing rather than managing their own fleet. This would be more a cost effective measure for a company that has been in operation for long and one that has a much larger acreage under its control. 2.1 How to make contact with the new list of customers In this case, there is need for heightened communication between the company and its new clients. This will b done through three major channels Telephone Email Personal communication The company will need to improve its Telephone management services. This will mean practicing better telephone etiquette and learning how to make the most of a short conversation with the client. Email messaging will be important in assessing consumer needs because they allow for fast and effective communication without creating some of the misunderstandings that arise out of telephone conversation. Lastly, Herne Organics will also use one on one communication with clients in case of complicated issues. When consumers have something they need to address with the company, then it would be most favourable to look for ways of meeting them personally. In these communication processes, consumers will be asked about some of the things that they value in the product. In other words, they will be asked about what is most important to them in the product. (NPCT, 2004) In this communication process, consumer will be asked about the most important quantitative aspects too. Besides the later, they will be required to give information about their opinion on Kent Limited in comparison to its competitors in terms of service delivery. This will be baked up by an inquiry into the long term qualities that consumers look for in products. 2.3 Types of vehicle needed to transport the apples and pears There are series of issues that will have to be considered during the transportation process. First of all, there are certain mechanic issues that need to be incorporated in the design of transportation vehicles. In order to ensure that the apples and pears are in good condition, containers carrying the goods will have to be stacked in a systemic way. Consequently, the vehicle needs to have adequate space and installations that will ensure no collapse of the products. Such vehicles ought to have shock absorbers. They also need to have tyres that can operate under low pressure tyres because these will go along way in supporting the products. On top of the latter, there should be speed governors in the vehicles owing to the fact that moving at quick speeds can maximize jolting and this may damage the products. (Edwards, 2004) There will be a need for bulk bins to carry the commodities from the farm to the market. This means that care should be taken while loading the product to offer adequate ventilation in the products. Since the product will be delivered to supermarkets, packaging of the products will also need to done uniformly. It should also be convenient in order to facilitate better removal. The following qualities will need to be considered in choosing packaging for the commodities Costs Capacity Utility Plastic crates tend to be preferred to wooden ones because they are cheaper (economical), they alt five times as long as the wooden ones and then are able to protect the vegetable much more than other types of containers. One of the most important aspects that will have to be accommodated in the transportation vehicles is a cooling system. When the vegetables do not have adequate refrigeration, then chances are that they may be exposed to harmful micro organisms in the atmosphere and this may cause spoilage. Consequently, the fleet of vehicles chosen for transportation will contain refrigeration facilities. (Glenn, 2001) The refrigeration fcailiaties must be made in such a way that they do not cause vibration of the commodities. If this is the case, then they may cause mechanical damage to the vegetables as they are. The facilities must also be such that they are strong enough to withstand haphazard movement on the road. If collapse occurs, then this could ruin the organic products. Lastly, vehicles used to transport vegetables must also be designed in such a manner that can facilitate easier cleaning. If left unclean or neglected, the vehicles can become contaminated or they may have a pungent smell. Consequently, this must be put into consideration. All in all, there must be due considerations of temperature octrol and there must also be consideration of the temperature control aspect in vehicle design. The floors used to make these vehicles need to be very tough and strong. This is because they have to have the ability to withstand strong pressure in case of any instances. The following are illustrations of some vehicles that can be used by Herne organics 2.4 How to save money or minimise costs in the transport budget The first thing that will need to be done to minimise transport cost is to lease rather than own the fleet of vehicles. As discussed earlier, there are series of issues that can be prevented through this approach. Diesel fuels costs are some of the primary concerns within any transportation business. This is usually because of the fact that fuel prices have sky rocketed over the past few years. This is also compounded by the frequent fluctuations in availability. Consequently, in order to eradicate this, there will be a need to establish certain ground rules within the company. For instance, vehicles will only be rented when there are specific deliveries to be made. Additionally, transportation will be done in shifts with specific emphasis on the night shift where there will be less traffic jam and hence less fuel wastage. Drivers will also be instructed about some tips on how to minimise fuel economy; for instance, when waiting on the road, one can save up to twenty percent of their fuel by turning off the engine. Additionally, it will be effective for the company if they conducted frequent maintenance so as to eradicate unnecessary fuel wastage. Also, good care will be taken to ensure that the vehicle fleet has sound engine systems. (Dransack, 2004) Driver’s pay will be minimized by offering them hourly rather than daily or weekly wages. By doing this, the business will only be paying for services rendered. Also, the company’s drivers will be kept at the lowest possible value so as to have the optimum number. Vehicle repair costs will be reduced by conducting frequent checks on the vehicle. Servicing goes a long way in reducing some of the challenges that arise out of operating one’s own vehicle fleet. This is because they capture problems prior to their growth and this eliminates bigger problems. Additionally, drivers will be taught how to drive safely so as to minimise damage to the vehicle. Cost on staff will also be kept to a minimum through the use of basic staff members. Only those services that are required in the farm will be considered. Also, staff will be required to multitask so that the numbers are kept down. Vehicle hire costs will be reduced by doing enough homework about the companies with the best offer. Additionally, contracts or agreements made with such companies will be adhered to strictly so as to minimise fines and penalties that arise out of violations of the agreements. (Edwards, 2004) 2.5 Distribution patterns When the company begins operating under the new management, there will be a need to examine some of the new distribution needs that will arise. The company will have to survey the needs and demands specific to this new distribution list as most of them my not be in line with these requirements. Also, care should be taken to ensure that the fleet composition is in line with these distribution patterns. Two major things are important in distribution patterns -Optimal payload -Vehicle utilisation capacity The load to be covered in the distribution patterns must be such that it optimizes the available fleet. Additionally, the company must ensure that vehicle capacity is utilised while considering some of the distribution patterns relevant to the company. In this case, the company will have two categories of clients and they are; large scale clients and smaller scale ones. The first category will largely be made up supermarkets and large retail chains. The latter category will be made up retailers who operate on a small scale. Consequently, the deliveries made to these two categories need to made in such a way that they can accommodate the diverging needs. Smaller retailers are more flexible and may not have preset supply chain systems. However, supermarkets may do. Consequently, in order to meet these needs, care must be taken to consider their respective systems. Deliveries will need to be done on a daily basis and this will depend on distances of those supermarket chains. Precedence will be given to the furthest stores so as to minimise delays. The shift system will be arranged in such a manner that the most closely located supermarket will be the last on the delivery list. 2.6 Support required for transportation The current vehicles within the company will not be adequate enough to meet the new requirements for Herne Organics. This is because produce has drastically increased. First of all, the company will require greater number of vehicles of their produce. The exact number will be assessed by the first harvest and how much has been transported in one truck at each instance. Additionally, there must be adequate staff to handle the vehicles. Drivers will possibly be two of them. Additionally, these drivers will need to have sound mechanical knowledge about how to deal; with minor repairs and maintenance practices. When the drivers can do it themselves, them they can prevent undue expenses. Additionally, support will be required from experts who have dealt with delivery of products to large scale consumers through outsourced vehicles. This expertise may be obtained from transportation consultants within the UK transport industry. (March, 2007) 3.0 Conclusion The management of a new fleet of vehicles requires adoption of internal and external solutions to meet the requirements of specific firms. Internally, the transport system will employ new drivers and attendants to boost the process. Additionally, this department will collaborate with other members in order to communicate with the new clients so that care can be taken to ensure that those clients are getting value for their money. Externally, the company needs to incorporate assistance from two major categories. The first will be a good transportation company that will offer the fleet of vehicles needed for delivery. Additionally, the company will also need to borrow expertise from a transport consulting company. This company will assist in streamlining the transportation process within Herne Organics though the utilisation of prior experience that they have with other companies. 4.0 References Emp, R.; (2007): Cities and Cars; a handbook of best practices; 1st edn; McFarland Co.; Minneapolis March, J.; (2007): A guidebook for performance based planning; 8th edn; National Academy Press; Toronto. Fisher, I.; (2004); British Public Glossary; 2nd edn.; McMillan; London. Glenn, P.; (2001): Glossary of transit terminology; Public Transit Association, No. 34, pp. 97 Dransack, P.; (2004): Transport planning and research; 3rd edn.; Prentice Hall; UK. Edwards, H.; (2004): Urban transportation planning; Palgrave; 2nd edn.; New York. NPCT; (2004): Transportation management; Environmental Design Journal, 2, 34, 68 Read More