Sharp ■ Informed ■ Challenging
29.4.19
QUALITY. COMFORT. PERFORMANCE. ‘Over-optimistic assumptions’ meant 3PL failed to deliver promised savings
Knights of Old replaces DHL as Eurocell partner
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DHL Supply Chain has been replaced by Knights of Old as Eurocell’s logistics partner after failing to deliver a promised £1.3m of annual cost savings. UPVC manufacturing and distribution business Eurocell has turned to Knights of Old, offering them a deal that will see the Kettering-based firm take over the transport operations from DHL Supply Chain in September. The move comes after the 3PL failed to deliver projected annual cost savings of £1.3m from the first year of its five-year contract, which was awarded at the end of 2014. Eurocell attributed the costsavings shortfall to “assumptions made at the inception of the contract over the ability to reduce historic warehouse labour costs, which were too optimistic”, in its 2016 annual report. As a result Eurocell took the warehouse operations back in-house in January 2017 and began
working with DHL to “deliver more efficient services and improve end to end customer focus and supply chain support”. It is understood that Eurocell will continue to run the warehouse operation itself. The win follows Knights of Old’s successful bid to become Irish parcel carrier CAE Delivers’ long-
distance partner, which was revealed in January. Both contracts will add momentum to the haulier’s recovery from a challenging period that saw it record an operating loss of £2.7m in its most recent trading period, the year to 31 May 2017. Eurocell and Knights of Old declined to comment on the deal. A spokesman for DHL said: “On conclusion of our existing contract, on 29th August 2019 DHL will cease to manage Eurocell’s transport operation, which will transfer to a new provider. Affected staff have been informed of the situation and will shortly enter into consultation with the company and their representatives to discuss their options, including transferring to the new provider under TUPE regulations. “Both DHL and Eurocell thank colleagues for their understanding at this time and stress the decision has been taken for strategic reasons and in no way reflects on the quality of service delivered to date.”
CM Downton showcases contract wins and renewals CM Downton has publicised a slew of contract wins and renewals gained during the past few months, including a deal to work with Blackford, Perthshire-based bottled water company Highland Spring. The Gloucestershire-based firm, which is part of EV Cargo, has also been revealed as the transport successor to collapsed Canute Haulage Group at Mirius. It has been handling the distribution requirements for the hygiene solutions provider since late last year.
Both firms have manufacturing or warehousing facilities based in the Midlands and required national distribution at short notice.
CM Downton has also renewed or extended deals with UPM, Rockwool and Hydro. The haulier said that cumulatively the new business will add £30m to its top line on an annualised basis. The wins and renewals come after CM Downton suffered a blow with the loss earlier this month of long-term client Frontline Group, a magazine sales and distribution company, to Menzies Distribution (see motortransport.co.uk).
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