Compete & Collaborate
Three Scottish transport companies - Highland Thermo Logistics (HTL), Waltons of Oban and Long Lane Deliveries (LLD) - have developed collaborative relationships which have improved their customer offering and helped to build their businesses.
The three companies collaborate where it makes most commercial sense, but remain very competitive on other routes. A key component of this successful collaboration is the chilled cold store and yard in Inverness, owned by LLD and managed by HTL.
Whilst the companies continue to compete on many routes, they also have informal agreements - Waltons collect from Glasgow, sometimes from LLD's Bellshill depot, and deliver around Argyll, the West Coast and the islands. They then pass goods to HTL, who collect from Waltons' Oban base, for onward delivery to the rest of the Highlands.
HTL reciprocates by delivering to Waltons from the rest of the Highlands, for onward delivery to Argyll and the islands. HTL also operates a similar relationship with LLD, which offers UK-wide deliveries for HTL, and which uses HTL for deliveries on many Highland routes.
All three agree that there are clear business benefits for each of their companies. Overall, they have become more efficient as a result of their collaboration.
Each collaborative relationship is fairly informal - as each company is a separate entity, they see no need to engage in joint strategy and planning. They don't set targets, but they have been open and fair with each other, in order to build up trust.
HTL and LLD have service level agreements, and have exchanged price cards. HTL has set most of the prices for the Highland deliveries, which LLD accepts as fair. For Waltons and HTL, the arrangement is very informal - business is offered and shared as it comes up.
There were a few teething troubles which had to be overcome for all three companies - predominantly around service level agreements and some logistical issues around timings for deliveries and pick-ups.
Key points from this case study:
- collaboration can make commercial sense in some circumstances, without compromising competitiveness
- Finding the right partner might not happen right away - make sure you don't tie yourself into a relationship too early
- partnerships can be informal, as long as there is a clear understanding that benefits are shared fairly
- Improved customer service can be a real business benefit
Download the full case study as a PDF
