Wm Armstrong - keeping it in the family

Haulier Wm Armstrong, based just on the English side of the Scottish border in Longtown near Carlisle, celebrates its 85th anniversary this year, and the third generation of the family running the business today are working hard to ensure the business is handed on to future generations.

The famous green livery – which the firm has used ever since William Armstrong acquired his first Model T in 1927 – has long been associated with livestock wagons, but the foot and mouth crisis of 2001 marked a turning point for the company. It has since diversified, being a founder member of the Palletforce pallet network, and while it will never entirely escape it farming roots the business is no longer totally reliant on this highly cyclical sector.

Wm Armstrong is still very much a family firm. Founder William Armstrong had one daughter and six sons, one of whom, Bob is still chairman, while his brother Cyril is vice chairman. Two brothers stuck with farming while the other four went on to build up the haulage side.

Today, four grandchildren of the founder run the business. Jennifer Whyberd is managing director (pictured centre), Geof Armstrong is sales director (right), Derek Armstrong is livestock director (left) and William Armstrong is fleet and dealership director. To bring a fresh pair of eyes to the business, the family appointed non-executive director Trevor Hebdon to the board in 2009. Hebdon spent 25 years in corporate banking and 11 years as chief executive of H&H Group, a livestock auctioneering company that used to own Armstrong’s current head office site.

Family dynasty

The family dynasty began when William Armstrong, a farm labourer, bought a smallholding that came with a single Ford Model T truck (still proudly on display at Armstrong’s headquarters) and began moving coal, livestock (one cow at a time) and milk in churns. The haulage business was given a boost in 1928 when Swiss dairy giant Nestle arrived in Carlisle and gave Armstrong a contract to haul nine churns of milk a day to the dairy for 10 shillings.

“Nestle were looking for farms to supply their milk and he approached farmers to ask them to supply milk to Nestle,” says Whyberd. “He got his first milk contract in 1928 before the Milk Marketing Board was set up in 1933.”

The haulage side really took off in 1947 when William’s eldest son Bob took the reins. He was soon joined by brothers Harold (father of present directors Derek and Geof), Jock and Cyril, and in the 1950s the firm expanded rapidly in livestock haulage, successfully winning business from the railways which were too slow for transporting live animals long distances.

Livestock expansion

At the time it was still also collecting milk for the Milk Marketing Board, but Whyberd’s father saw a big opportunity to expand the livestock business.

“There were a lot of deaths among animals being moved by train because they often got left in sidings,” she says. “There were a lot of local farmers going to North Scotland to buy North Country Cheviot lambs, which wouldn’t fatten up there because the ground wasn’t as good. Dad went up there and that was the start of the long distance livestock haulage. It took 16 hours to get from Caithness in those days but that was still a lot faster than the train.” 

In 1958, the haulage business relocated to its current site when William senior acquired the livestock auction site owned by Harrison & Hetherington when it pulled out of Longtown and relocated to Carlisle.

Unlike today, when supermarkets’ demand for fresh meat means there are fattened animals going to abattoirs all year round, in those days livestock haulage was a highly seasonal business. Milk production too rose and fell with the seasons, with peak production when cows were outside eating grass.

General haulage

To avoid having vehicles standing idle in the quiet times, in the 1960s the firm diversified again.

“To fill the gaps they looked to fertilisers and drainage pipes that were being brought in to drain the land, so more general haulage started coming along,” says Whyberd.

At this time the haulage business was still fairly small, with no more than half a dozen trucks, mostly Bedford and Chevrolet flatbeds. In those days, there were no specialised vehicles – milk was carried in churns and to carry livestock a box was built on the flatbed. This was also long before palletisation and the churns and clay drainage pipes were all loaded, roped and sheeted by hand.

The firm faced a turning point in 1984, with the untimely deaths of Jock, Harold and founder William Armstrong.

“It was a big blow and we had to get more involved very quickly,” recalls Derek. “We were apprentices at the time and Jennifer was running the accounts department. I had to start going to the cattle markets and talking to customers. It was hard work at first but they took me under their wing and we still have a lot of old, established customers who knew my father and won’t use anyone else.”

In the 1990s, the company developed international livestock haulage and took pedigree pigs to Europe. “We would go as far as Portugal, Greece and Spain, and took cattle to Germany,” says Whyberd.

Big changes

A lot has changed in farming since the current generation took over the family firm, with the end in 1994 of the Milk Marketing Board as the monopoly buyer of milk, a vast reduction in EU subsidies and consolidation of small family farms into larger conglomerates.

“The livestock haulage industry has become so small,” says Whyberd. “We travel the length and breadth of the country every day and while our head office is here in Cumbria we are not a Cumbrian haulier when it comes to livestock. Farmers have their own trailers to go to local markets because we can’t send a truck to move 10 or 15 sheep.”

“Local livestock haulage has disappeared,” agrees Derek. “It’s too expensive because it costs £50 just to start the lorry these days. I would rather they take the animals themselves than me send them a bill for £100 to shift 10 sheep.”

But the biggest crisis was in 2001, with the worst outbreak of foot and mouth disease the country has ever seen. Even today, 11 years on, memories of that bleak time for rural Britain are clearly fresh.

“2001 was a watershed for our business,” says Whyberd. “Foot and mouth came to that market across the road on 27 February 2001. At that time we had about 40 trucks, with a third of our business in livestock, a third in general haulage and a third in milk. We lost all the livestock – it just stopped and the milk started diminishing as farms were getting foot and mouth. We saw our business just declining. We had great relationships with our suppliers and pulled in every favour we could. On Mothers’ Day 2001we all went to lunch and that afternoon said we would have to start making redundancies. But we didn’t want to lose those key livestock people because if they went to something cleaner we had lost them for good.”

But that same day the company had a call from the Ministry of Agriculture offering a contract to move sheep to be slaughtered in a cull of all sheep and goats in a 3km radius of the farms in North Cumbria that had had foot and mouth.

Breathing space

“It was just a short eight-week contract but it saved us and kept our people employed,” says Whyberd. “It gave us a breathing space for Geof and the general haulage team to look at increasing that side of the business as much as we could.”

Even hauling general loads such as bricks, however, the association of Cumbria with foot and mouth meant Wm Armstrong vehicles were not made welcome.

“We had to get a police escort out of Wales, such was the fear around the country,” says Whyberd. “We did lose some drivers at that point, and we realised we were too reliant on agriculture.”

Derek adds: “Even after foot and mouth was over, there were fewer movements of animals because there were less of them and everything had to be done under strict licence. It was predominantly slaughter animals – there was no breeding stock moved in a bid to stop the disease.”

As well as the slowdown in domestic livestock transport, the international movement of animals virtually stopped.

Palletforce founder

As is often the way, it happened that in 2001 Mick Scarlett was setting up Palletforce and he approached the Armstrongs to become a founder member of the network in September of that year.

“That became a key area for growth in the business,” says Whyberd. “There was only one other member in Scotland – Glenhire - so we had Cumbria and Scotland apart from Fife and Tayside. It was a massive area to cover but we had a lot of other hauliers that we sub-contracted the deliveries to. We were really pleased that Mick Scarlett came along and put that faith in us because he was challenged by a lot of other hauliers he had signed up asking why he was using these people who transport animals.”

Whyberd convinced Scarlett that Armstrong’s excellent reputation for customer service in livestock could be transferred to pallet distribution, and since then general haulage has grown to become the firm’s mainstay. To cope with the seasonal nature of the business, Derek now only runs a core fleet of animal transporters, relying on sub-contractors for the peak periods.

“We have 15 of our own vehicles on livestock but that can rise to 40 in the season,” he says. “A lot of them are second or third generation hauliers who came up out of agriculture and now rely on us for their work.”

As a result, livestock now represents just 20% of the business.

“Because people see our livestock vehicles travelling the length and breadth of the country, the impression has always been that we are livestock hauliers, but we are much more than that,” Whyberd says. “We made the commitment to Palletforce and set up a 40,000sq ft general haulage depot in Uddingston near Glasgow in 2005.”

The company’s location close to the M6/74 motorway and in the ‘no man’s land’ of the disputed Borders country (Longtown is north of Hadrian’s Wall and only a few miles east of Gretna) made it ideal for a Palletforce depot.

“We can hit Scotland and go to the Midlands and back in a shift because we are travelling at the right time of day to avoid the traffic,” says Whyberd. “We were used to working with other hauliers on the livestock and that was something Mick was promoting with Palletforce, where the first members were predominantly drawn from the Transport Association.”

Balanced traffic

When Armstrong started with Palletforce, the company was mainly delivering pallets put into the network by members further south. A successful network however requires more or less balanced volumes, otherwise trunkers running empty on one leg add significantly to cost.

Now, while it is still takes out more pallets than it puts in, Armstrong inputs a wide range of palletised freight into the network, ranging from packaging and food to horticultural products. “There are lots of new businesses starting in Scotland and they are generating extra loads,” says Geof. “We don’t rely on palletised freight to get our trunks down south and we are always looking at other alternatives. The Glasgow depot was opened to develop a regional distribution centre for Armstrong’s business and attract other businesses on the back of our reputation, which has always been strong in Scotland.”

It now averages six doubledeck trunks a night going north and five going south to the Palletforce hub. All the trunkers are handled from Longtown, with day drivers who go to Glasgow, offload and pick up a trailer to bring back to Longtown. Armstrong benefited from the relocation of Palletforce’s new £30m hub in Burton-on-Trent in 2009 as it is 20 minutes closer.

“This gave us a little bit more margin, which was a massive benefit ,” says Geof.

There are 88 members with 94 depots in Palletforce, of which 84 members in England and Wales are sending freight to Scotland. “The mix of quarters, halves and full pallets going north is quite apparent, but for the Scottish members sending freight south it is predominantly half and full pallets,” says Geof. “So we are getting trunks with 60 pallets coming north and we are maxing out on bulk going south. So we are never going to balance out pallet numbers – to do that I would be sending 10 south for the six coming back up.”

European ambitions

It is no secret that Palletforce is looking at replicating its successful UK network on the Continent and Geof says that is something his customers would welcome.

“We get a lot of enquiries from customers for a European service and Palletforce has taken on European sales director,” he says. “We offer a regular service to major EU countries like Spain and France but Palletforce aims to be into eastern Europe on a regular basis. There is certainly a demand for exports from the UK out there.”

The recession has led to many retailers and distributors reducing stocks, ordering smaller consignments more frequently from suppliers.

“The split between next day and economy was 60/40,” says Geof. “Now there is not a lot of difference in price so it is more like 75/25. We thought in the last recession there would be some consolidation among the networks but I don’t think the UK is saturated with networks. There is some dual networking by hauliers and some networks allow it which Palletforce don’t.”

Return to Nestle

On the milk side, in 1994 Armstrong returned to its original customer Nestle, which was once again getting milk directly from farmers, for a contract to deliver milk to its dairies.

“A lot of farmers remained loyal to Milk Marque and Dairy Farmers of Britain, but we were working for Nestle between 1994 and 2004,” says Whyberd. “In 2004, there was a tender process and for the first time in Armstrong’s history we had no milk tanks.”

In 2007 Dutch entrepreneur Ron Akkerman came to talk to farmers about setting up a co-operative to process their own milk at a new dairy in west Cumbria. “He came to us and asked if we would collect the milk and we said yes,” says Whyberd. “When Dairy Crest gave their farmers notice they decided to go with Ron, and he got planning permission for a dairy near Workington. But just before it got started, a heavy metal cleaning firm got permission to build next to the dairy site. So the dairy could not be there and the business was sold to Meadow Foods and that is who we work for now.”

Meadow Foods is a growing independent business taking milk from over 500 farmers to make ingredients for the food industry in factories at Chester, Holme on Spalding Moor and Peterborough. Armstrong collects from farms across Cumbria with a fleet of 20 vehicles. These include smaller specialised rigid tanks that collect from farms and trans-ship the milk into the larger tanks for transport to the dairies.

Nestle moved from Carlisle to Dalston in the 1990s where it built its third biggest factory but in 2001 Switzerland had seen how badly the UK government had coped with BSE and foot and mouth, and they moved from buying direct from farms to supply via farmers' co-operative First Milk in 2003.

After a rocky period when low milk prices were forcing many dairy farmers out of business, the market had until recently stabilised, and UK production increased slightly in recent years.

“There were a lot of farmers leaving the industry, but it had improved in the last few years,” says Whyberd. “But unfortunately there has just been another 2p/l drop in the price and farmers are going to be nervous again.”

Niche markets

Like all specialised niches, operating milk tanks is a high risk sector. While milk always needs collecting from farms every single day of the year, the upheavals in the market mean customer contracts can come and go. It is also hard to rent a milk tank, so Armstrong always has a spare vehicle on standby in case of a breakdown. “In the rest of the business you don’t have to do that, but the milk tanks are double shifted seven days a week and we have to plan for servicing, annual tests and breakdowns,” Whyberd says. “We have to flexible too - there are days when we deliver milk locally in Cumbria or at other times of year we have to take the milk to dairies in the South of England.”

But Whyberd knows that specialisation is good protection against the general haulage giants like near neighbours Stobart Group. 

“It is through specialising that we are where we are,” she says. “We have the milk, the livestock, the Palletforce network, dangerous goods and now the Moffat Mountys.

These niche areas can make life difficult at times though, with all the different assurance and accreditation schemes.”

As well as the vehicles, drivers too have had to become specialised in each sector. “Back in the 1970s and 1980s, a driver did livestock, milk, fertiliser and general haulage,” says Derek. “Now they can’t transfer because of the certification they need in each department.”

Training for the future

Animal welfare is always a top priority for Armstrong, and not just because the regulations have got tougher over the years.

“We recruit a livestock driver for their ability to handle animals, and the driving is secondary,” says Whyberd. “There are problems recruiting livestock drivers across the country, and after the foot and mouth outbreak we started looking at how we were going to bring people into the industry. I went to school with Robin Brown [now chief executive of Carlisle-based System Training] so we set up an apprenticeship scheme for driving goods vehicles, and we now have a high percentage of apprentices in the business.”

The success of this pioneering apprenticeship scheme has been recognised with a slew of awards, including the MT Training Award in 2005, and it has been helped further by the growth of the Palletforce business, as young drivers can start on the smaller 3.5t local distribution vehicles before graduating onto the larger, more complex animal transporters and milk tanks.

The company is approved to carry out its own Driver CPC training inhouse and Whyberd believes it can be a benefit.

“We do a driver essentials course but we are looking to do specialised courses in milk and livestock,” she says. “It is something we have to do so why not use it to benefit the business? There is no point doing five lots of tachograph training – we can make it more useful by focusing on customer service, livestock handling, milk sampling and testing etc because there are lots of areas where we should be training drivers. By focussing on training we can ensure that as the company grows the same levels of service are given to all customers.”

Diversify to survive

To further reduce its reliance on farming, Armstrong has also won haulage contracts in forestry and fibre optic cable distribution, and built up a tidy truck dealership and workshop business. This started in 2002 with the acquisition of then Foden dealer Cumbria Truck Centre and now has an Isuzu Truck and Hino dealership and an all-makes workshop at Longtown. Since then Armstrong Trucks has been added to the Glasgow site, offering sales and repair of Hino trucks. More recently, Armstrong Trucks has begun carrying out MOT tests on cars and vans, and has launched Truckapart, an internet based parts business. The company is also looking at adding a third lane to its Cumbria Truck Centre and becoming an Authorised Test Facility to carry out annual tests of LGVs.

Armstrong ran a predominantly Foden fleet until Paccar pulled the plug on the much-loved marque and the company had to look at other brands. It took Hino on in the dealership but the Japanese manufacturer had no truck suitable for the Armstrong fleet, and the company now operates a mix of Renault, MAN and Scania.

“We run them for three, four and at a stretch five years, depending on the job,” says Whyberd. “New trucks are selected for the particular specialist type of work with some going onto the Palletforce trunks before moving onto tramping. It is important to get the right vehicle for the job. Our workshop, operated by subsidiary Cumbria Truck Centre, keeps up with new technology with on-going training and development. Having our own workshop ensures that we are able to provide specialist support to keep our fleet, and our customers’ vehicles, on the road 365 days a year.”

Like many operators, Whyberd is concerned about the additional cost, complexity and fuel consumption resulting from of the move to Euro 6.

“Over recent years reductions in emissions has been driving down fuel economy- we had vehicles back in 2005 that were more fuel efficient than today,” she says. “We will be taking this into account in our programme of replacement and keep on Euro 5 as long as we can. Euro 6 trucks’ fuel economy is expected to be worse, they will use more AdBlue and will reportedly cost at least £7,000 more.”

But then she reflects: “Or is it scaremongering? We were all frightened of Euro 4 as well!”

The future is bright

While 2008 credit crunch and subsequent recession have been tough on all operators, the Armstrongs have survived much worse.

“Volumes have been maintained and we have kept busy,” says Whyberd. “When we have a difficult time we look at each other and say ‘well, it’s not as bad as foot and mouth’ – nothing could be as bad as that. We are operating 85 vehicles now - 20 more than in 2008 - and 180 trailers. We know how to knuckle down and get on with it.”

That is not to say life is easy – far from it – and to survive in today’s market means squeezing out cost wherever possible.

“We looked at ourselves and how we managed the business, because we are all very hands-on,” says Whyberd. “We brought in non-executive director Trevor Hebdon - he comes along to the board meetings and keeps pushing us along.”

Armstrong has built a loyal customer base who stick with the firm because it delivers a top notch service at a good price, but competition for business remains fierce.

“A few hauliers went out of business because they couldn’t get credit for their fuel supplies in 2009/10 but I am surprised at how few have gone,” Whyberd says. “We look at every bit of our business to see where we can save money. We can’t sit back and say ‘that’s how it’s always been’ – we have to accept change and look at different things. Sometimes in a family business people get settled in and we have to keep challenging ourselves and asking the awkward questions.”

Next generation

So what of the future? Will the Armstrong torch pass to a fourth generation?

“There is a fourth generation in the business but they are quite young and still working their way through,” says Whyberd. “The business has also changed and we have to have the right people for the right jobs. We have a lot of good young managers coming through the business and we can’t wait to see if the next generation want to follow in our footsteps. But we have to remember the family ethos.”

Founder and still active member of RHA

Wm Armstrong was a founder member of the Road Haulage Association in 1945, and has been actively involved in its livestock group ever since. Whyberd is chairman of the group, a role filled by her father for many years, though it has since been enlarged to take in milk transport too.

“Some of the specialist groups within the RHA have struggled, but this is a strong group,” she says. “We are now governed by EU legislation and are always facing new rules and regulations.”

Livestock hauliers are also affected by other European regulations, such as the tightening of hygiene standards for abattoirs that saw many smaller sites close down, resulting in live animals having to be transported further afield. So a proposed regulation restricting the hours animals can be transported for slaughter caused some consternation.

“Some of the biggest abattoirs are in Wales, and because the supermarkets want fresh lamb on the shelves all year round they have to go all over the country to buy lambs,” explains Whyberd. “So we have to transport them from Scotland to Wales, and because they want to cut down the risk of disease they want them collecting direct from farms not from markets. It can take four or six hours to collect the animals before the vehicle can set off.”

The restriction was successfully defeated, emphasising the importance of monitoring the goings-on in Brussels so that hauliers can have their say. The livestock group is lucky to have retired haulier Eddie Harper in Somerset who works as a consultant and attends a lot of the meetings. “Without that we can end up with new legislation that we didn’t know was going to happen,” says Whyberd.

Another proposal that came out of Brussels was to limit the stocking density of animals in transporters, based on the weight of the beasts and surface area of the vehicle compartment.

“We had to explain to them that not all animals are the same, and you get tall and slim as well as short and fat,” says Whyberd. “We invited all the officials here, along with the RSPCA and Compassion in World Farming, to see for themselves. They watched the sheep come into the market and then came here for our meeting. It was a real eye-opener for them and made them understand the issue.”

The problem with trying to come up with EU-wide legislation in this field is that conditions and levels of enforcement vary widely across the 27 member states. “The temperatures in Spain are completely different from here, so why should we have the same rules?” asks Derek. “Trading Standards here also enforce the rules a lot more strictly than in other parts of Europe."

Dual nationality

Despite its English roots, Wm Armstrong is has always managed to maintain a dual nationality and is accepted as an honorary as well as ‘official’ Scottish haulier.

The official Scottish status was conferred in a letter from the Scottish Office during the 2001 foot and mouth crisis, stating that Wm Armstrong was Scottish and so exempt from the ban on English hauliers moving livestock north of the Border.

Honorary Scottish status was ensured when in 2002 the directors made the wise move of accepting an offer to become shirt sponsor of Gretna FC, then a small Scottish amateur club playing in the English minor leagues.

Later that year, millionaire insurance tycoon Brooks Mileson started investing in the club and set about transforming it into a Scottish Premier League side, quickly taking them to the dizzy heights of the Scottish Cup final at Hampden Park in 2006.

To mark the occasion, Armstrong liveried a new doubledeck trailer with the Gretna FC banner and the slogan “Living the Dream”.

Sadly, soon after, the Gretna bubble burst, and in 2008 the club went into administration with massive debts. By then, however Wm Armstrong had reaped the benefits of its links with the Gretna dream.

“Using the Gretna association, we were accepted as Scots, and there were no accusations in Uddingston of the English coming north,” says Whyberd. “That really helped us get the Uddingston depot established. We are now firmly rooted in Central Scotland providing warehousing, haulage and distribution, as well as truck servicing and car and van service and MOT services through Armstrong Trucks – a Scottish company.”