A shortage of suitable subcontractors contributed to a squeeze on margins at automotive logistics specialist Brit European Transport in its last financial year.
Despite continued growth in sales in the year to the end of December 2014, the availability and cost of using subcontractors was “a major factor” in pressure on margins, a spokesman for the firm told Motortransport.co.uk. “There is a distinct shortage of good quality subcontractors who are able to meet our and our customers’ stringent quality and safety requirements. It’s probably as bad now as it has been for quite a while,” he said.
Rates were also tight during the year, he said, with “very tight margins when we were quoting for work, both on a contractual basis and ad-hoc work”.
A “severe” shortage of good quality drivers has also been a problem for the firm, which described it as “the single largest restriction to the business in the year to come”.
Despite all these problems, Brit European raised its turnover by 10% during the year to £34.2m (2013: £31.1m) while pre-tax profit more than tripled to £420,000 (£117,000) to leave it with a much-improved margin of 1.2% (0.14%).
Turnover in the car division was enhanced by a full year’s trading with Jaguar Land Rover, with whom it started work in November 2013 collecting vehicles from Halewood and taking them to various ports of exit; and by new business from Toyota. The firm’s fuel and chemical divisions performed “satisfactorily”, meanwhile.
Looking ahead, said the spokesman, the firm envisaged “a greater challenge this year due to increased competition, lack of good quality subcontractors, OEMs driving down prices and a distinct shortage of drivers”.
