UK rail could make big supply chain savings

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The UK rail industry could save up to £425 million in operating costs and £722m in capital costs annually through better supply chain and asset management, according to a government commissioned report.

The report, Realising the potential of GB rail, is the result of a study chaired by Sir Roy McNulty and commissioned by the secretary of state for transport.

It said the annual cost savings could be achieved by 2018-19 through reduced overheads resulting from a reduction in man-marking and simplified processes; reduced work volume (scope and specification) though smarter definition of requirements, eg, through earlier involvement of partners; and reduced cost of work delivery through better performance and less risk.

“The earlier the incentives for collaboration can be put in place, the faster the savings can accrue. The widespread adoptions of partnering and alliances across the industry will also deliver significant cost reductions,” it said.

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