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Prime Mover Magazine

Redstar Transport on the rise

Redstar Transport on the rise

Cross-nation line haul is one of the most challenging freight tasks in Australia. John Dixon and Sean Williams are two respected industry executives who stepped up to the challenge in 2013 when they formed Redstar Transport.

Albeit the new kid on the block, Redstar Transport is somewhat of an old acquaintance to many in the industry. Formerly known as Bunker Freight Lines (BFL), John and Sean purchased the company from Silk Logistics Group last year and re-named it to mark the beginning of a new era for the long-standing business.

Originally started by Ron Bunker in the 1960s, BFL was a key component of the Silk Logistics Group for the past half decade, alongside stable mates like Silk Contract Logistics (formerly Kagan Logistics), Doolan’s Heavy Haulage, Hoffmann Transport and WA Freight Group. In 2013, however, Co-Directors John Dixon and Sean Williams took the helm and created Redstar as an independent brand.

Interestingly, both John and Sean are ex-Silk men and already knew the business inside out before making the move. After a career that included Executive Director roles at Linfox, Patrick Corporation and Skilled Engineering, John spent the previous three and a half years as Managing Director of Silk Logistics Group, while Sean, joined Silk as Chief Financial Officer in 2008, when private equity group Gresham Partners first acquired the companies that formed Silk Logistics Group.

Together, the two decided to separate the old BFL business from the Silk Group and create a whole new brand. Now with the fresh Redstar Transport identity, the company continues to flourish in what is a highly specialised market, moving full trailer loads of express line haul freight on a sub-contract basis for a number of major companies that require time-sensitive deliveries to be carried out in a safe and compliant way.

Because Redstar is somewhat of a ‘wholesaler’ to the road freight industry, the new owners knew that it needed to be an independent and dedicated line haul operation to succeed. “Under Silk, there was the WA Freight Group, which was a freight forwarder and also a customer of Bunker. But that automatically threw Bunker into conflict with its traditional customer base, because it was providing services to its sister company in the same way it was providing services to its other customers,” John explains.

Both John and Sean found that there was not enough crossover between the individual businesses within the Silk Logistics Group; and as the equipment used also varied from business to business, there was no real opportunity to share resources between the cartage operation, the heavy haulage specialist and an interstate freight business.

What they have now is a highly specialised business, operating in an area they understand well and have spent most of their working lives in. “One attractive aspect of the Bunker heritage is that we have long-standing key customers who we know personally, so we have good customer relationships to build on,” John says. “We may work under a different name now, but we still strive to provide and improve the services they require.”

With the new set up, Redstar’s client base is somewhat limited compared to the old days, but the aim is to continue to engage with existing customers and secure a bigger share of available work. At the moment, a select group of six or seven customers such as StarTrack and TNT account for the majority of Redstar’s clientele.

From a change management perspective, much of the heavy lifting had already been overseen by John and Sean during their time with Silk. John and Sean initially re-configured just a few areas of their new entity in a quiet way and deliberately refrained from big changes during their first six months of operation, concentrating on basics such as key performance indicators, measurement, accountability and responsibility for compliance and safety within the business.

The biggest change was to bring the business into the modern transport environment in terms of dedication to safety and compliance. “The focus on compliance and accountability is real and 24/7,” says Sean. “This was the business that we had to remake, so when John joined Silk, we changed just about all management and processes in the business. We stripped it back right to the core.”

Under new leadership, the business embarked on a plan that was about cultural change and did not involve significant leaps, but small steps that would allow them to slowly build a new platform of compliance and safety around the company.

“We knew that we could meet or exceed market expectations in terms of rates required to gain business, but at that stage we didn’t know that we could exceed our safety expectations even if we wanted to,” John recalls. “The platform that we wanted wasn’t so much about a cheap rate because we left those days long behind. It was about having the safest service possible on a measured basis.”

The new management team then set about putting “milestone events” in place so they could measure how their service was improved and at the same time control improvements in safety performance.

During that phase, the company concentrated on three aspects to maximise safety. The first was a comprehensive induction process for new drivers and operations staff. The second area was the improvement of vehicle safety reports in the company’s three workshops across Australia. And finally, they set about developing a system that, on a measured basis, provided precise service, safety and compliance performance statistics to their customers on a monthly/ quarterly basis so that they knew exactly what management were saying about those factors was genuine.

Those efforts are now supported by the General Managers, who meet with key customers on a monthly basis, and Operations Managers, who have at least weekly contact. “Any issues are quickly addressed due to that high level of transparency,” says John. “We tell our customers the truth – if we have slipped up, we’ll be proactive about fixing it. If we fail for a breakdown reason or whatever, keeping the customer informed as it happens is crucial – especially for our time sensitive customers.”

Due to the large number of Redstar trucks on the road at any one time, the operations staff has the facilities to identify an alternative and prioritise a changeover should a breakdown occur. “Our customers have the assurance of knowing that we are compliant and they are at less risk under the Chain of Responsibility,” says John. “It cost us a lot of money to achieve that. We invested several million, not just several hundred thousand, to put the regime in place both from a technical perspective but also from a cultural point of view in terms of the way people think, act and behave.

John adds, “It was also about engaging the right people within the business who understood how to do it and remain on track. It was about discipline, it was about selection, and it was about skill set and cultural matching. It was about being really in tune with what we knew the customers wanted and actually delivering it rather than talking about it. And the only way to deliver it securely was to perform and to measure what we had done.”

Another thing that the new management team did was reassessing the investment in the drivers. A comprehensive program was put in place to upgrade the drivers’ facilities both on the road and in the depots around the country to provide much better recreational and sleeping facilities. The bunkhouse model was replaced with individual rooms for the drivers on rest breaks; and the adoption of a high degree of transparency in driver pay rates has lead to a lot more stability in the driving workforce. Such improvements have made it easier to recruit better quality drivers – and those who do get taken on tend to stay longer.

A key process in the safety upgrade was the analysis of every driver trip sheet and every single maintenance report that was available on the safety programs. Daily compliance reporting means that if a driver has been detected speeding by even three or four kilometres over the limit, they will be spoken to. The drivers understand that if that level of breach occurs more than three times, they are dismissed. Exceeding posted speed limits by a much larger amount, such as ten kilometres per hour, results in termination.

In addition, a tailored transport management system was introduced to standardise operations nationally, rather than rely on the people’s knowledge and spread sheets, which may have been quite sophisticated but not structured sufficiently.

Utilising a conventional transport management system also meant that everyone in every depot is now using the same process and the same screen to book the jobs and to allocate resources. The MT Data based technology uses satellite tracking, which allows management to know exactly where each vehicle is and lets them check its speed, log book and all fatigue management requirements in relation to the driver’s current activities in real time.

Every driver gets a trip sheet for the route they travel and they know well in advance where and when they have to take rest breaks. The instant they become non-compliant due to not having a rest cause warning flashes up on the operations centre screen, and the driver is contacted and ordered to pull over.

On the equipment front, Redstar has the dual advantage of using modern trucks and main highways, so that route planning including rest breaks can be accurate to a very high degree.

Redstar has also addressed situations where a driver may become non-compliant due to delays created by clients when loading or unloading trucks. In those circumstances, the company will bring in a fresh driver and charge the customer a fee. Redstar management is adamant that their drivers cannot be put into jeopardy situations due to non-time compliance at warehouse loading and unloading points, and strives to avoid the domino effect that is created further down the logistics channel by such delays.

The 175 prime movers in the fleet are in the process of having trucks with American drive lines phased out and replaced with mainly Volvos and some Mercedes Benz units. “We want to give the drivers on the road the right trucks, which is why we really favoured Volvo,” says Sean. “We think they are the safest truck on the road.”

Redstar has taken delivery of thirty new Volvo units over the past few months and is also using several new Mercedes-Benz prime movers on specific tasks. According to Sean and John, European trucks encourage a softer and more respectful approach from the drivers, who are not thumping down on the throttle or hitting the brakes too hard. In addition, the company now has compliance programs on fuel management and expects the drivers to treat the trucks like they were their own.

The newer trucks are usually put on road train work running to the west and back. As they age, they are based back in the eastern states. Annual kilometres travelled by each vehicle are generally between 380,000 and 440,000; and the trucks are either replaced or treated to a full driveline rebuild at around 1.3-1.5 million kilometres.
The company’s three workshops are kept as pristine as the vehicles. The Melbourne vehicle service branch even has a goldfish pond in its foyer.

From a management point of view, John and Sean regarded it as fundamental that management are able to obtain an understanding each day on what was being spent on maintenance on each piece of equipment – be it a truck, trailer or dolly. The system is now in place to be able to track the costs associated with each unit on a cents-per-kilometre basis.

Precise cost control is key in the trucking industry, as the rapid increase in air freight capability in Australia, coupled with the decline of the manufacturing base, particularly in Victoria, has affected the consistency and patterns of freight transported by line haul operators. At the same time, rail capacity has increased, which could make Redstar’s efficiency more poignant.

“We need the technology to handle things just once, not four or five times,” says John. “If goods can go by road we’re pretty sure that we can be competitive. Not many people in Australia can really run effective and safe line haul transport. It’s really tricky. It’s a juggling act with customers, people and heavy machinery.”

John and Sean certainly have considerable commercial acumen, but it is their intimate knowledge and understanding of their specialised operation that has made their company a success in such a fine margin business.

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