Hermes' delivers £1m saving to earn 'Business Champion' safe-driving status from Government-backed campaign

28 April 2010

Europe’s leading home delivery company, Hermes, is in the vanguard of cutting road deaths and injuries after introducing a range of safe-driving measures that have contributed to a £1 million cost saving in the 12 months to April 2010.

The catalyst for the financial savings and a string of other employee health and safety benefits is the Hermes Driving School, which plays a critical role in ensuring that the company’s 480 employed drivers and 163 agency drivers meet its industry-leading safe driving standards.

The focus on safe-driving in 2009/10 when compared with 2008/9 saw a:

• 109% improvement in accident-free days per vehicle from 216 days to 434 days resulting in significant reductions in vehicle downtime and the cost of vehicle replacement
• A 33.5% (£240,000) cut in the cost of incidents

The reduction in the number of vehicle-related crashes and their severity was recorded against a background of the size of the light goods vehicle and HGV fleet increasing 11% from 430 vehicles to 479 and the number of days of vehicle use rising 16.9% from 134,160 to 156,775. In addition to the commercial vehicle fleet, Leeds-based Hermes also operates 183 company cars. More details on how Hermes has done this can be found here.

Simultaneously, the number of insurance claims related to vehicle damage have reduced 60% and UK insurance premiums for the business dropped 10% in the last 10 months.

It is that focus on safety through the Driving School, which was opened in 2004, and the subsequent reduction in vehicle-related crashes and resulting financial savings that has seen Hermes become the 43rd company to achieve ‘business champion’ status from the Government-backed ‘Driving for Better Business’ campaign, which is managed by RoadSafe.

There are an estimated up to 200 road deaths and serious injuries a week resulting from crashes involving at work drivers, and more employees are killed and seriously injured on Britain’s roads while driving on behalf of their employer than in any other work-related activity.

The safety drive has been led by Hermes chief executive Carole Woodhead who said: “We are delighted that our concerted focus on at-work driving safety has been recognised by the campaign.

“Hermes has successfully achieved year-on-year growth in volume, revenue, market share, and profit. This success stems largely from a change in management culture which addressed, among many other factors, the need to manage those driving on behalf of the business more thoroughly and to scrutinise the costs associated with them more effectively. The catalyst of change has been the Driving School, which has delivered enormous benefits for the Hermes business.

“A knock-on effect from the improved accident rate per vehicle and the increase in the number of accident free days per vehicle was the significant reduction in vehicle downtime and the cost of vehicle replacement across the fleet. This, in turn, had a significant impact on the service to Hermes customers because it was possible to make improvements to client delivery and collection times.

“We ensure that all drivers are made aware of the impact they deliver to business results through the improvements in reducing incidents involving Hermes vehicles and improving their fuel efficiency.”

Hermes offers clients, including some of the UK’s most successful retailers such as Next Directory, QVC and Lands’ End, a dedicated business to consumer residential delivery solution, specifically designed to meet the demands of the European retail, mail order and online shopping market.

Today Hermes:

• Handles over 110 million parcel deliveries and collections annually
• Delivers 22% of all catalogue and internet home delivery parcels throughout the United Kingdom
• Utilises the services of over 7,500 local couriers under contract, who provide a flexible service to their neighbourhoods up to six days per week using their own vehicles
• Employs over 1,600 people across the country to support the network.

The Driving School, which is an industry-leader, now delivers induction and continuation training for all Hermes drivers with a concerted focus on safe-driving and encouraging employees to drive fuel-efficiently with the end result being cost savings.

The focus on ‘smarter’ driving has contributed to at least a 4.5% reduction in fuel consumption in the past year across the business that has resulted in significant cost savings and delivered a positive impact towards reducing Hermes’ carbon footprint.

Ms Woodhead said: “The development of Hermes employees and a focus on safety is central to delivering superior customer service, revenue and business growth. We want to improve the professional knowledge of our drivers whether employees or agency, and ensure that they are aware and competent in all measures which will deliver a safe working environment.”

All drivers are introduced to the Hermes work-related road safety policy and procedures in their initial induction training with both in-vehicle and classroom sessions and thereafter in all elements of the training delivered by the Driving School and in certain elements delivered as part of corporate training.

Training is supported by on-going one to one in-vehicle coaching, which begins on completion of training, by depot champions to ensure continued performance improvements and positive impact on results.

Meanwhile Hermes’ company car policy ensures that all vehicles conform to the work-related road safety policy and procedures at all times. Individuals needing to travel by car for business purposes use either a company, hire or private car, with all vehicles operated under the terms of the company car policy.

All drivers of Hermes’ commercial vehicles must meet minimum standards, which include: a minimum of two years driving experience since passing their test and no more than six penalty points on their licence for speeding with no other offences acceptable. The company undertakes driving licence checks quarterly.

When accidents do occur the company completes a detailed analysis. If shortfalls in training standards are identified then drivers may receive additional training.

Ms Woodhead concluded: “We operate in an industry that is constantly feeling the pressure of rising fuel prices, new legislation, increasing customer demands, market competition and an economy in recession. We have continued to invest in training to help us meet these challenges and the success of the Driving School has had a direct impact.”

The success of the Driving School, which trained 926 drivers and delivered 1187 driver training days last year, has now prompted an internal review to examine the feasibility of expanding and extending the courses and programmes offered.

The core programmes currently include: driver assessment, induction for all new drivers, driver Certificate of Professional Competence training, Safe and Fuel Efficient Driving, a drivers’ hours workshop and an annual practical in cab driver refresher course.

Finally, the company is investigating the feasibility of offering training to other businesses and professional organisations.