Profitability

Is your plan actually delivering long term sustainable profits

Enhance Profitability

Is the choice of freight correct? What is guiding your pricing positions? What is your price per tonne, per unit or per container? How did you arrive at this price and where is it going in the next 5 years?

What are your service levels and performance like? Think this is not related to profitability, think again. Are you pushing 99 or 100% on-time train running? Late trains cause revenue erosion, increase costs and dilute shipper confidence.

Volumes. Do you have a volume, revenue and profit focused growth plan. What are the volumes currently and is this within the highest expectation of your growth plan. Have you got a plan to double the volume? Remember increasing volume does not necessarily always mean a need to increase resource, if your operation is inefficient. Think profit on a lower cost basis!

Ingredients for Profitability

Number of trains. What are the number of trains per day in relation to your resource levels? Should that number be higher? Are you sure?

What are your exact costs, for the whole operations down to the smallest micro level? You don’t know this? Then why are you running a freight operation. Your ability to achieve profitability is severely hampered if costs are not identified down to the smallest scale.

People. Who is in your organisation? What do they actually know about running a rail freight company? How much dead wood do you have? You must off-load the dead wood before you even think about profitable existing operations. There are no spaces for passengers – senior personnel as well as shop floor personnel.

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