3 Methodological Approach to Consultation and Data Collection
3.1.1 The key aim of the study was to analyse the impact of the removal of RET fares for commercial vehicles on the economies of the Western Isles, Coll and Tiree. To inform the analysis, a detailed consultation exercise was carried out to allow evidence and information on the impacts to be gathered. This section sets out the approach to the data collection exercise.
3.1.2 In summary, our methodological approach to the primary data collection for this study involved a combination of face-to-face haulier interviews; face-to-face business interviews; the carrying out of an online business survey; and telephone interviews with hauliers in a selected 'control group'. The findings from each of these activities, coupled with desk-based research and operator data interrogation, were used as the basis for developing this report. Summaries of each of the stages of the consultation exercise are set out below.
3.2 Haulier Interviews
3.2.1 The haulage industry is clearly an important player in this study as it is hauliers who will face the direct impact of an increase in CV ferry fares. If ferry fares were absorbed completely by hauliers then the impact on the islands would simply be the impact of the ferry fare changes on the bottom line of the businesses in the haulage sector. However, an increase in fares will, to some degree, be passed on in terms of higher transport charges to businesses. The business models and pricing behaviour of hauliers before and during the RET period and their intentions as fares return to non‑RET levels are therefore key in understanding the overall impacts of removing RET for CVs.
3.2.2 To this end, a series of face-to-face interviews was undertaken with hauliers on both the islands and the mainland. A total of fifteen companies were interviewed, representing all of the main operators serving the Western Isles, Coll and Tiree.
3.2.3 The interviews with hauliers were conducted at the interviewee's premises. Each interviewee was taken through a structured questionnaire but encouraged to explore issues raised in a more discursive style. The desire to contribute was evident, and most consultees were willing to give 90 minutes upwards of their time to discuss in detail the issues from their perspective.
3.2.4 In addition to interviews with individual haulage businesses, consultations were held with the Freight Transport Association and Road Haulage Association so as to obtain a wider perspective on the view of the sector.
3.2.5 The interviews covered a number of key themes, the most important of which involved exploring hauliers' pricing behaviour as a result of RET being introduced and its subsequent removal, with a key aim to understand how higher ferry fares will impact on transport charges for businesses. The process also asked detailed questions about the business model; areas of operation; vehicles used; goods carried; frequency of ferry use etc of each haulier in the survey. Overall, the survey provided a detailed understanding of the haulage market in each of the islands taking part in the pilot, as well as the different responses to changes in ferry fares.
3.2.6 It should be noted that, in a number of cases, detailed evidence was presented by hauliers to substantiate claims made on issues such as transport charges and whether these had fallen or risen over the period of the study. However, it was emphasised by a number of hauliers that this information is commercially sensitive. It has therefore not been reproduced in this document. Nevertheless, where relevant, reference is made to the evidence presented to substantiate the claims made during the interview process and supported by general data wherever possible.
3.3 Business Interviews
3.3.1 As well as the interviews with haulage firms, a series of face-to-face interviews was carried out with businesses across the islands. The purpose of the interviews was to understand how the additional charges levied on hauliers filtered through to businesses and the wider supply chains across different sectors and geographic locations, and how higher transport charges have impacted on business performance and the wider economy. In total 37 businesses were interviewed, covering a range of industry sectors and geographic locations.
3.3.2 The interviews covered a wide range of topics, including sectors and areas of operation; business turnover and profitability; the impact on business performance from the introduction of RET and the consequences of its removal; cost pass-on from haulage firms; cost pass-on to end customers; and the rationale for current haulage arrangements.
3.3.3 It was very clear that the issues raised and views presented in the interviews with businesses correlated very closely with those provided in the haulier interviews. The same themes were put forward regularly, reinforcing the points raised and providing a consistent picture of the impacts associated with the removal of RET for CVs.
3.3.4 Similar to the haulier interviews, evidence was presented by businesses but has not been reproduced in this report due to the commercially sensitive nature of the information.
3.4 Online Business Survey
3.4.1 In order to validate the findings of the interview process, an online survey of businesses was also undertaken to canvass views of those that were not selected to take part in an interview. The aim of this survey was to assist in developing a wider evidence base to critically assess and support the findings of the business interviews. A key point is that the survey was focused more on collecting factual data than on more general opinions on the removal of RET for CVs.
3.4.2 The first section of the survey asked a series of basic questions about the respondent's business. The survey was then split into six separate sections and the respondent was routed into the section that was most appropriate to their business, as follows:
- If the business contracts with a 3rd party haulage or delivery company to move its goods and supplies by ferry between the mainland and the islands;
- If the business uses its own commercial vehicles (ie greater than 6m in length) to move its own goods and supplies only;
- If the business uses its own commercial vehicles (ie greater than 6m in length) to move a combination of its own goods and those of others;
- If the business uses its own commercial vehicles (ie greater than six metres in length) to move goods and supplies for others only;
- If the businesses uses cars / vans (ie less than six metres in length) to move all of its goods and supplies by ferry between the mainland and the islands; or
- If the business does not directly use ferries to transport its goods/supplies because it buys/sells everything it needs from/to island-based suppliers/customers or 3rd party organisations who deal with the transport of the goods to/from the mainland.
3.4.3 The aim was to achieve 100 responses to the online survey. However, despite significant publicity, the survey only achieved responses from 49 companies. Despite this lower than anticipated response rate, the responses covered a wide range of business sectors across the islands. In addition, the issues to emerge from the survey were consistent with those from the interviews with hauliers and businesses and we are confident that the relevant issues have been captured both in a geographic and sectoral sense. In our opinion it is unlikely that a larger sample would have raised any key issues that were not picked up in the survey.
3.5 Control Group Interviews
3.5.1 A series of interviews was proposed with hauliers and businesses on islands with similar characteristics to the Western Isles, Coll and Tiree but did not take part in the RET pilot. The aim was to isolate the impact of removing RET fares for CVs by comparing the findings from the islands which had witnessed a large increase in CV fares through the removal of RET to the experience of islands with similar characteristics which had not seen large increases in CV fares over the same period. The islands chosen were Arran, Islay and Mull.
3.6 Understanding the Precise Impact of the Removal of RET for CVs
3.6.1 A key methodological issue to emerge throughout this study is the ability to isolate the impact of the removal of RET from the wide range of other factors that are impacting on the islands. For example, many businesses noted that haulage costs have gone up since April 2012 (see section 4.7) and explained that the removal of RET is a reason for this. However, they also note that it is one of a number of factors driving up costs and, when pressed, the majority of businesses could not estimate how significant the removal of RET for CVs is when compared with other factors such as fuel price increases.
3.6.2 In addition, it is important to note that the general economic slowdown is affecting the level of activity and individual business performance on the Western Isles, Coll and Tiree, in line with other island and mainland communities in Scotland. While every effort has been made to isolate the impact of the removal of RET for CV fares from the impact of the wider macro‑economic situation, it is difficult to be precise and one must bear in mind this limitation when interpreting the findings.