takeover target, page-9

Agree - the cost pressures from customers are going to erode margins.

The unfortunate thing is that all transport and logistics companies are price takers, and the customer has control.

We are seeing bigger customer fragmentng their supply chain providers moving away from integrated models like Tolls. The best expamples of this is the move by Woolworths last year who now buy rail freight direct on the Adelaide-Darwin corridor from Freightlink (trains operations provided by AIO, and use local private companies in Adelaide and Darwin (http://www.camerons.com.au/News.aspx?ID=57&Article=1). The upside for WOW is they retain the margin that TOL had on this work.

IMO - if this concept gets embraced by oher retailers and big users of freight if could be reallt damage the TOL business?