Boalloy: no premium on quality
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by Brian Weatherley • Jim Gibb, sales and marketing director at Boalloy, is bemused...apparently hauliers think a Tautliner is expensive. "Everybody believes they can't afford a Boalloy," he says, "apart from the operators that buy them!"
That's hardly surprising. Boalloy's curtainsider body has long been viewed as a "RollsRoyce" product, with a price tag to match. But the recent price war in the UK trailer market has put an end to all that. "Ten years ago we could command a premium of at least £1,000 over our rivals but not any more", says Gibb. "Now there's no difference, we're neck and neck."
Boalloy is faced with persuading more operators its products are within their reach—without alienating customers who've previously paid more for a Boalloy trailer or rigid body.
Challenge
It won't be easy, but recent events have forced Boalloy to look again at its prices. "1997 was a bloodbath in the industry, and while the volumes have come back this year they've not done so for everyone." says Gibb. Add to that his view that "there are no bad trailers anymore", and it becomes harder to justify charging a premium for a standard curtainsider.
So will more blood be spilt in the trailer sector as manufacturers fight for their share of a contracting market? "1 don't think it will be any more difficult on price than this year," says Gibb, "And this year is as difficult as we've known it."
As volumes shrink and margins get tighter, trailer manufac
turers will have to find new ways of maximising their return on revenue. Gibb believes Boalloy is already well down that road. "We're now seeing some payback on £500,000 we spent on computer-aided design in the past four years. That's starting to bear fruit, as is the £300,000 we spent on integrating our business systems— we've got engineering a mite more sophisticated now."
And Gibb reckons Boalloy can do more to make its manufacturing even more efficient—and less costly. "This industry is renowned for blacksmith engineering—we've gone beyond that," he explains. "Now you're into a more technical product. We've always used sub-assembly ourselves, but now we're looking towards making a 'buy-in' decision. Should we be totally selfsufficient, or could we buy in a good deal of that sub-assembly function? For example you could have complete fronts and backs supplied—though not roofs as they're too awkward."
Buying in more sub-assemblies would unlock more production space, too. And buying in more components could allow the company to price its products more effectively.
Gibb says: "I'm not saying we'll go to a 'stack 'em high, buy 'em cheap' approach. But we've come to the conclusion that while a Boalloy curtainsider is still held as the best in the business, we've fallen in line with the truck makers—their customers won't pay a premium."
And with the advent of evershorter operating cycles, and more trailer leasing and buyback deals, Gibb says the once widely held view that if you paid more for your trailer you got more back in the used market now longer holds up.
Residual
"It's a harsh lesson—as that residual can be 15 years down the road," he accepts, "but these days you might only have the trailer for five."
A wind of change has been blowing through the trailer market as more chassis manufacturers opt to build their own bodywork—Gibb cites Crane Fruehauf s Speedliner as an example of that trend—but Boalloy has hit back by buying its own chassis manufacturer, M&G. Early signs are good. In 1997 M&G was building fewer than 20 chassis a week; that's risen to 30, which is the highest in the company's history, Meanwhile, "factoryfit" rigid bodywork deals with the likes of Leyland Daf and Iveco Ford have provided Boalloy with volume, reducing its dependence on its traditional trailer business. This year it will build 1,800 GRP boxes on 7.5-tonners and Gibb believes that size is a critical factor in Boalloy's future success. "The bigger you are, the better purchasing power you have and the better competitive edge," he says. "It's the same for our customers. The big are getting bigger and our philosophy is that the big will only deal with the big—thankfully we've positioned ourselves in the arena of the big boys."
If size is that important will Boalloy soon be back on the acquisition trail? Gibb believes manufacturing agreements are the way ahead and the company will look for more firm deals with truck manufacturers.
BOALLOY'S NO-BUCKLE CURTAINSIDER
• Boalloy is close to unveiling its own buckle-less curtainsider body following extensive operator trials. "We genuinely believe that among buckle-less designs this is it; that's why we haven't rushed at it," says Gibb. "We've been asked by customers to speed up loading and unloading. Current designs are slow, and they get damaged. We think we've got the real answer. We'll launch it before the end of the year and display it at the CV Bodywork show next year." According to Gibb, Boalloy's design is "very clever. There are no wires, no handles.. .only a button". While Boalloy is not revealing the name of the major operator which has run trials of its latest product, Gibb says its buckle-less design will offer fuel savings over conventional designs.