Generation game
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Family firms can falter when they pass to the next generation but in the case of BH Cecil the handover is the reason the company is still in business. Richard Simpson reports
‘The right thing to have done would have been to shut this business in 1992, when our then major customer reduced its rates.’ That shockingly honest remark comes out of the blue from the lips of Geoff Cecil, the 49-year-old managing director of Gloucestershire haulier BH Cecil.
It is shocking because it comes from a man who has recently added an all-singing, all-dancing Daf XF95 to his fleet and commissioned who knows how many thousands of pounds worth of airbrushed artwork depicting the family company’s four generations in road transport, to go with it.
Cecil is not bitter, but he is hard-headed. And he finds the climate in road transport today deeply frustrating. The willingness of other operators, particularly foreign operators, to bend the law for their customers’ benefit is one thing. The disproportionate benefit enjoyed by the same foreign operators thanks to Europe’s skewed taxes and subsidies is another.
‘Things have gone from bad to worse since Poland and the other ex-Eastern bloc countries joined the EU. And, in my opinion, it is going to take six to eight years before Europe becomes a level playing field again and the British haulier can compete. At the moment the European Union is bringing the entrant countries up to our standards, at our expense.’
That is a gloomy prognosis and it prompts the question, why didn’t the business close in 1992? ‘I had Paul, my lorry-mad seven-year-old son, and in the end I decided to keep it going for him. Being able to pass the business on to the fourth generation gives you an incentive to keep going,’ Cecil says.
New work was found. BMW was investing heavily in Britain and soon BH Cecil had 12 new Volvo FH Globetrotters running a shuttle service between the UK and Munich for the car maker. This was a classic automotive manufacturing just-in-time operation, with UK-sourced components being loaded for delivery directly into the production lines of BMW car plants and the trailers then being backloaded with returns, components and spare parts for the UK BMW dealer network.
The trucks and trailers ran in BMW livery and carried the first British-built engines to Germany from BMW’s Hams Hall engine plant in the UK. ‘In the years we did that work, we never missed a delivery,’ Cecil recalls.
But the work began to dwindle and, early this year, a phone call from Germany dealt the final blow.
‘I was told that we were now £1000 a trip too expensive, and that we would need to drastically lower our costs.’
One of Cecil’s golden rules is that he will only work on an open-book costs-plus-profit basis and that was not a rule he was about to break. ‘I told them that that day’s load was the last we would do for them. The only way to have reduced cost on that job would have been to run bent, and that is something I would never do.
‘Running to Munich is a one man, one week job. It takes 20 hours to drive there and 20 hours to drive back. I was told the rates the competition were doing it for and even if their wage costs using eastern European drivers were 25% of mine, it still would not pay if each truck was doing only one trip per week’
Cecil is in no doubt that low-cost competition from foreign hauliers prepared to operate illegally cost him the work. ‘At one time we were loading foreign trucks out of here, and some drivers appeared to be running for 20 hours or more without a proper break.’
He had to take drastic and painful action. A dozen drivers were laid off and trucks and trailers sold. Then the same thing happened again on a job which BH Cecil was running from Wiltshire to France and Germany. He tried again, this time running fridges to Europe, but currency fluctuations made that job uneconomic too.
‘Now we only go abroad by special request from a customer. I do not even look at run-of-the-mill European work. The smaller British haulier has been priced out of the international market, and it has not been hard to see why.
'All that was keeping some of them in it was opportunity to take advantage of the lower cost of European diesel, which they were able to use to subsidise the UK part of their operations. But the rising cost of fuel all over Europe has eroded that margin, too.’
Cecil is frustrated that the British government is doing nothing to help.
‘Even Germany now has tolling sussed. We are an island, so why can’t we tax foreign lorries? In Belgium, France, Germany and virtually everywhere else on mainland Europe, we have to pay to use the roads. It would now cost us about £130 to cross Germany, yet a German haulier pays nothing for the use of the UK’s roads. Why? If we have to pay there, they should have to pay here.’ Cecil feels that when the industry talks to the government, it is all too often the wrong people who speak.
‘The really big operators do have the ear of government, but the problem is that there is no one person in any of those companies who has a true grasp of all the difficulties that the industry faces. There are legal, operational and economic problems that someone running between five and 20 trucks will understand, but they do not all have the same impact on any one person in a big company.’
The latest retrenchment at BH Cecil has seen the company concentrate on UK work, and its mainstay is now transporting a high-value building material. This is a product that requires specialist trailers and handling, and work that is relatively safe from cut-price competition.
‘There is plenty of general haulage work out there if you do not mind running at a loss,’ Cecil warns. ‘If you do not know your costs, you do not stand a chance.
‘It is quite probable that the business will come back to just six lorries, which is where we were when we lost the work in ’92.’
Fortunately, Cecil has fingers in other pies. A trained toolmaker, he also runs a thriving metalworking business that shares the BH Cecil premises in Blakeney on the edge of the Forest of Dean. He has other interests in land and property and hopes to build some affordable homes for local people in the village.
‘For every pound I have invested in lorries and other depreciating assets, I have also tried to invest a pound in things that will appreciate, he explains. Meanwhile, he aims eventually to pass BH Cecil Ltd to Paul, now 20, and driving the XF95. ‘He keeps me going,’ Cecil admits.
It is shocking because it comes from a man who has recently added an all-singing, all-dancing Daf XF95 to his fleet and commissioned who knows how many thousands of pounds worth of airbrushed artwork depicting the family company’s four generations in road transport, to go with it.
Cecil is not bitter, but he is hard-headed. And he finds the climate in road transport today deeply frustrating. The willingness of other operators, particularly foreign operators, to bend the law for their customers’ benefit is one thing. The disproportionate benefit enjoyed by the same foreign operators thanks to Europe’s skewed taxes and subsidies is another.
‘Things have gone from bad to worse since Poland and the other ex-Eastern bloc countries joined the EU. And, in my opinion, it is going to take six to eight years before Europe becomes a level playing field again and the British haulier can compete. At the moment the European Union is bringing the entrant countries up to our standards, at our expense.’
That is a gloomy prognosis and it prompts the question, why didn’t the business close in 1992? ‘I had Paul, my lorry-mad seven-year-old son, and in the end I decided to keep it going for him. Being able to pass the business on to the fourth generation gives you an incentive to keep going,’ Cecil says.
New work was found. BMW was investing heavily in Britain and soon BH Cecil had 12 new Volvo FH Globetrotters running a shuttle service between the UK and Munich for the car maker. This was a classic automotive manufacturing just-in-time operation, with UK-sourced components being loaded for delivery directly into the production lines of BMW car plants and the trailers then being backloaded with returns, components and spare parts for the UK BMW dealer network.
Early days
The BH Cecil business was founded in 1920 by Forest of Dean miner Bertram Harold Cecil. Operating out of Clement’s End and Clearwell in the heart of the forest, it began as a coal round using a horse and cart.
Motor lorries soon followed, with BH Cecil using swap bodies to convert his early Ford, Chevrolet and Morris vehicles from freight to bus duties as required and the limited company was incorporated in 1964.
The bus business was disposed of in 1939, and the transport operation passed to Cecil’s four sons: Gilbert, Richard, Royston and John; eventually relocating to Blakeney.
Geoff, Royston’s son, acquired all the shares in 1992; the year when, ironically, the rates were cut.
The company’s pioneering days are memorialised by a preserved gate guardian: a Ford Model AA (which is finished in BH Cecil livery but which started life working for a chain of famous chip shops); and also recorded by Matt’s Airbrush paintwork on the Daf XF driven by Geoff’s son, Paul.
There is a Leyland Roadtrain in the yard awaiting preservation too.
The trucks and trailers ran in BMW livery and carried the first British-built engines to Germany from BMW’s Hams Hall engine plant in the UK. ‘In the years we did that work, we never missed a delivery,’ Cecil recalls.
But the work began to dwindle and, early this year, a phone call from Germany dealt the final blow.
‘I was told that we were now £1000 a trip too expensive, and that we would need to drastically lower our costs.’
One of Cecil’s golden rules is that he will only work on an open-book costs-plus-profit basis and that was not a rule he was about to break. ‘I told them that that day’s load was the last we would do for them. The only way to have reduced cost on that job would have been to run bent, and that is something I would never do.
‘Running to Munich is a one man, one week job. It takes 20 hours to drive there and 20 hours to drive back. I was told the rates the competition were doing it for and even if their wage costs using eastern European drivers were 25% of mine, it still would not pay if each truck was doing only one trip per week’
Cecil is in no doubt that low-cost competition from foreign hauliers prepared to operate illegally cost him the work. ‘At one time we were loading foreign trucks out of here, and some drivers appeared to be running for 20 hours or more without a proper break.’
He had to take drastic and painful action. A dozen drivers were laid off and trucks and trailers sold. Then the same thing happened again on a job which BH Cecil was running from Wiltshire to France and Germany. He tried again, this time running fridges to Europe, but currency fluctuations made that job uneconomic too.
‘Now we only go abroad by special request from a customer. I do not even look at run-of-the-mill European work. The smaller British haulier has been priced out of the international market, and it has not been hard to see why.
'All that was keeping some of them in it was opportunity to take advantage of the lower cost of European diesel, which they were able to use to subsidise the UK part of their operations. But the rising cost of fuel all over Europe has eroded that margin, too.’
Cecil is frustrated that the British government is doing nothing to help.
‘Even Germany now has tolling sussed. We are an island, so why can’t we tax foreign lorries? In Belgium, France, Germany and virtually everywhere else on mainland Europe, we have to pay to use the roads. It would now cost us about £130 to cross Germany, yet a German haulier pays nothing for the use of the UK’s roads. Why? If we have to pay there, they should have to pay here.’ Cecil feels that when the industry talks to the government, it is all too often the wrong people who speak.
‘The really big operators do have the ear of government, but the problem is that there is no one person in any of those companies who has a true grasp of all the difficulties that the industry faces. There are legal, operational and economic problems that someone running between five and 20 trucks will understand, but they do not all have the same impact on any one person in a big company.’
Costs are key to profitability
Mr Cecil is adamant that the only way in which a business can survive is by controlling costs down to the finest detail. ‘If you are making 10% profit, then you need to turn over £100 more to earn an extra tenner.
‘So, if you can save £10, that is the same as doing £100’s worth of extra business.’
Every cost in the business is minimised, and passed on to the customer. ‘When we were running to Germany, with the trucks doing the same work every week, I tried different brands of fuel. There is no doubt that Shell diesel gives the best mpg, and it is worth the extra money, so that is what we use.
‘I cut our mobile phone bill by going for the most expensive service! I bought each driver a pay-as-you go phone. I can still call them when they are out of credit, but if they want to top up the phone they have to ask me for the money and they don’t do that very often!
‘But the most important thing is to cost your work on the basis that the truck can only earn money for 240 days a year. The benchmark figure for an artic is £350 a day just to cover
the fixed costs; mileage is extra. If you cannot earn that, then you are not going to be in business long.’
The latest retrenchment at BH Cecil has seen the company concentrate on UK work, and its mainstay is now transporting a high-value building material. This is a product that requires specialist trailers and handling, and work that is relatively safe from cut-price competition.
‘There is plenty of general haulage work out there if you do not mind running at a loss,’ Cecil warns. ‘If you do not know your costs, you do not stand a chance.
‘It is quite probable that the business will come back to just six lorries, which is where we were when we lost the work in ’92.’
Fortunately, Cecil has fingers in other pies. A trained toolmaker, he also runs a thriving metalworking business that shares the BH Cecil premises in Blakeney on the edge of the Forest of Dean. He has other interests in land and property and hopes to build some affordable homes for local people in the village.
‘For every pound I have invested in lorries and other depreciating assets, I have also tried to invest a pound in things that will appreciate, he explains. Meanwhile, he aims eventually to pass BH Cecil Ltd to Paul, now 20, and driving the XF95. ‘He keeps me going,’ Cecil admits.
