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How to diversify and grow in the transportation sector

Interview with Torstein Ottem, Director of T. Ottem Transport A/S

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European Business: Growing the company to four times its size in just ten years is a major achievement. How did it come about and do you expect to continue this level of expansion?

Torstein Ottem: I joined the family business in 2010 having previously worked at several other Norwegian companies that were active in production and recycling. It therefore made absolute sense to use this experience when we looked at diversifying the family business. Another big change came in 2012 when a compulsory purchase order on our old premises, which stood on land needed to build a new tunnel, forced us to move to a new location. This proved to be a blessing in disguise as it allowed us to expand physically. We now have a relatively generous 55,000 m2 of space available to us and have recently added sleeping quarters for our drivers on site. We are constantly looking at ways to improve our services and having received certification as a ‘Fair Transport’ company this year, we are working toward ISO 39001 and 50001 certifications to add to the ISO 14001 and 9001 certifications we qualified for in 2015.

European Business: Your traditional activity is in transport. How have you diversified your activities since 2010?

Torstein Ottem: We are now active in four evenly balanced business areas that cover the transport of animal waste, road maintenance, waste materials transports for the metal industry and miscellaneous transports. Animal waste transports is where it all began for us. We have worked for Biosirk Norge (previously Norsk Protein) since 1979 and recently acquired new client Nutrimar in the same sector collecting waste products from the animal processing business. Another key area for us is the transport of waste materials from the metal industry and the aluminium sector in particular. Norway is home to Europe’s largest aluminium plant and we are the main transporter of the waste they produce. We also have special certification for dangerous goods transports both nationally and internationally. In 2015 we started carrying out road maintenance activities in our home region. This covers both summer and winter work that includes washing tunnels, cleaning up after avalanches, snow removal and replacing signage where necessary. Finally, we carry out a variety of transport activities for farmers and waste plants including our own recycling plant which specializes in industrial waste and by-products from the metal industry.

European Business: How are these various markets developing, especially in light of the coronavirus crisis?

Torstein Ottem: Diversification allows us to limit our exposure to any single market. We have been looking closely at the aluminium market as production has reduced because of coronavirus. On the other hand, agricultural transports have increased in response to the Norwegian government’s efforts to stimulate local food production. We are also a member of a network of around 15 different companies from different sectors. We meet to discuss the situation in the transport sector and try to improve things through innovation. For example we defined a need for electric cranes and tipping mechanism on the trucks used to collect animal carcases so that no fuel is used for that and sourced funding for this change.

European Business: How large is your fleet at the moment?

Torstein Ottem: We currently have 42 trucks and travel more than four million kilometers each year. Our trucks have a maximum capacity of 50 or 60 t in comparison to the EU maximum of 40 t which allows us to transport more with each movement. We also have new 25 m combined tractor trailers which can also be used on roads in the Netherlands and Sweden. We have 55 drivers out of a total workforce of 80 people. We are one of the biggest companies in our region and one of only a handful to still be in family ownership. We turned over 100 million NOK last year and expect a 10% increase in turnover for this year, despite the effects of the coronavirus crisis.

European Business: What do you think is the secret to the company’s success

Torstein Ottem: I think as a family company, our customers appreciate the short communication routes and quick response times. We also have a fantastic team of employees who are all committed to our company goals. Growth has been phenomenally fast over the last ten years. We are now at a stage where we want to consolidate on that growth and fine tune and improve certain areas so that we are operating optimally from an economic point of view. Neverthless, we have also initiated a new project involving the repair of hydraulic components and the hydraulic equipment used in our operations. Diversification for us is an ongoing process.