Transport operators dealing with perishable goods must adopt more disciplined loss prevention strategies, says David Heather, perishable trade expert and consultant to the TT Club.
Speaking at the Intermodal Transport & Logistics Conference in Rotterdam, Heather said: “If claims and losses are not kept under control the high cost of insurance combined with secondary, uninsured costs will have a direct influence on the profits of the operating company.”
He highlighted a milk and dairy produce distribution company as having suffered costs of insured and uninsured losses equivalent to 1.8% of its operating costs in one year. The low margins inherent in the transport sector, meant the losses equated to some 37% of the company’s profit.
Heather propsed a seven-point strategy of disciplines including recognition of high-risk operational areas; acceptance of a level of self-insurance through deductibles; and correct assessment of equipment values.