Toll Group’s restructure to support One Toll program

The Toll Group has announced a business restructure as the logistics giant works towards advancing its One Toll program.

From 1 July 2014, Toll will reduce its divisional reporting structure from six divisions to five, and change reporting lines for a number of business units to better align contract logistics and network-based businesses.

According to Toll, the changes are intended to make it easier for customers to do business with Toll and to reduce crossover of service offerings between divisions. Other reasons include the desire to increase best practice sharing and collaboration across Toll’s business units and to reduce complexity and costs.

“This is a logical outcome given the progress we have made in our One Toll program and from our ongoing focus on returns,” said Toll Group Managing Director, Brian Kruger.

“We need to ensure that we are best placed to build on the key competitive advantages in our domestic network businesses, while also ensuring we are as aligned as possible with our customer needs in our contract logistics businesses. While cost reductions are not the key driver of these changes, we do expect to see meaningful benefits from this restructure together with other cost saving programs within Toll.

“We have strong businesses, particularly in Australia, but it is critical that in the current challenging market we reduce complexity and costs, improve our productivity and build on our strengths. This restructure will help mitigate near-term ongoing margin pressures as well as ensuring that we maximise the leverage that our company has to any improvements in the external environment.”

The restructure will include Toll Domestic Forwarding gaining Toll Express, Toll NQX and Toll Linehaul and Fleet Services. Toll Liquids and Toll Transitions, due to the contract nature of their activities, will be moved into Toll Global Resources. The specialised contract-driven parts of Toll Intermodal are to be incorporated into Toll Global Logistics and its Queensland freight forwarding operations will be merged into Toll NQX.

There are no changes to Toll Global Express and Toll Global Forwarding, both of which have significant programs already underway to improve productivity and competitiveness.

Toll expects that the restructure will generate annual savings in the range of $10 to $12 million commencing in the 2015 financial year.