First Kernow reinvented

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In a landscape that is quintessentially Cornwall, one of the new Tinner-liveried ADL Enviro400 MMCs works a Truro College service to St Ives and Castle Gate. JOHN PENN

Marc Morgan-Huws is First South West Business Director. He talks to Andy Izatt about some of the challenges he’s faced and the transformation that’s taking place at First’s Cornwall operation

Cornwall by Kernow is the new strapline for First Kernow, the Cornish network of First South West. Now profitable, the operation has been reorganised and is being remarketed, a process that is occupying much of Business Director Marc Morgan-Huws’ time. However, he explained that when he first became involved as a consultant in what was then First Devon & Cornwall two and a half years ago, it was the Taunton and Bridgwater-based Somerset operation transferred from First Somerset & Avon in 2014 that was his primary focus. [wlm_nonmember][…]

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“The need in Somerset was greater than in Devon and Cornwall,” said Marc. “The rural Cornish and Somerset markets might appear similar, but that wasn’t the case. Cornwall’s network has a substantial contracted element secured through tender, and while our staff hadn’t seen managers from outside the county very often, they turned the buses out every day regardless. While there was some competition with Western Greyhound, it was really only on a small number of peripheral routes. That wasn’t how it was in Somerset where the County Council is able to fund very little. It was a commercially-focused market where we were dealing in the main with copycat routes started by WebberBus. That’s why our operation had been rebranded as The Buses of Somerset.

“WebberBus collapsed in May 2016 and we’re now going through a gradual process of normalising the Somerset operation. With Yeovil depot transferred from First Hampshire, Dorset & Berkshire last year, we have around 230 staff employed to meet a PVR (Peak Vehicle Requirement) of 87 (not including First South West’s contribution to Somerset Passenger Solutions at Hinkley Point). What stands out in my mind has been the loyalty and determination of our people, in particular our driving team, who stuck with us as we went through that period of intense competition.”

Cornish aspirations

“The Cornish operation was losing money, but although there were some severe cost challenges, it wasn’t a lost cause,” Marc continued. “The real issue was that it had been allowed to stagnate for a long period of time.

“Cornwall’s remoteness makes our operation there very different to the rest of First UK Bus. Not only is it self contained, it operates a much smaller proportion of commercial work than other First subsidiaries. Our PVR is now approaching 200 including private hire and contract commitments, but less than 60 of those vehicles are on commercial routes. That means our focus had to be, and continues to be very much on where else we can generate revenue.

“Our most significant contract is with Cornwall Council for tendered services. Cornwall is probably the best spending local authority in the UK when it comes to public transport and the commitment it shows is absolute. What it’s spending is actually increasing.

“While the Council was given powers to introduce bus franchising, it required the Bus Services Act to enact those and I think any impetus to do that dates back to a time when the two main bus operators in the county, us and Western Greyhound, were failing to meet its aspirations. Western Greyhound has gone. We’re still here, but we understand the local authority’s concern that it might have been left with an operator that wasn’t in the best of shape.

“Two and half years down the line, I would like to think that we’ve demonstrated that First is very committed to the county. The business has been turned around financially as well as operationally and that has been backed by heavy investment in new vehicles – 30 double-deckers at a cost of £7m. We’re also focusing on how we can integrate what we do with First-owned GWR (Great Western Railway) to improve the whole offer and, most importantly, drive up patronage. However, we recognise that there’s still a long way to go.

“Against that background we think the Council is developing a view that a partnership with First delivers the benefits of franchising, but without a lot of the risks and costs although we know and happily accept it will be a permanent requirement that we continue to work with it to deliver a better result. The deliverables are clearly understood and that extends at the highest level within First UK Bus.

“The significant proportion of revenue that comes from the Council determines how we make what we do sustainable and it means we have a different relationship with the public sector compared to other First UK Bus subsidiaries. It’s a far more joined up approach. We’re quite open when it comes to outlining what our revenue and costs are.

“For the past two years we’ve managed to agree fixed concessionary fares deals and we’re currently having a wider discussion on that this time around. What we’re very clear on as a business is it doesn’t really matter where the money comes from, so long as it comes. There will be some things the two parties agree on and others that will be more of a challenge, but everyone understands the common need to work together to grow passenger numbers. The Council wants high quality public transport and we want a viable business. To deliver both we need each other.”

Reversing decline

Said Marc: “Alex Carter had become Managing Director of First Devon & Cornwall around three years ago. Like me, he was initially a consultant. The Cornish operation we inherited had clearly, but quite understandably been neglected for some time. That’s not a criticism of anyone who had worked here before us. It’s simply that it was perceived as being part of a much bigger region where passenger numbers and public sector support had been declining. Competition primarily from Western Greyhound hadn’t helped and inevitably the response had been to cut costs more, cut back a bit more on services and eke a few more years’ life out of vehicles.

“When we arrived it was apparent we needed a fundamental understanding of the business and how it worked if we were going to build it back up again. That meant clearly identifying the commercial network and reviewing all our contracts in detail. With Cornwall Council we effectively went through a complete tendering exercise and negotiated a new deal, but there were others we worked with as well. For example, we agreed a new contract with Truro & Penwith College for which we currently run 36 vehicles a day during term time.

“What was really important was understanding how our fares operated and simplifying the structure to reflect the varying needs of locals and tourists alike. It had been very much a regional fare structure that was quite complicated and didn’t suit visitors in particular. Making sure that the concessionary fare scheme worked for us was part of that process.

“Having got the network and fares right, the next big challenge was making sure the business was resourced properly. I think we were a long way towards achieving that when Western Greyhound went bust on March 13, 2015.

“I don’t know quite what we were expecting to happen. Smaller independent operators are much more agile and flexible businesses and you begin to learn that other people have operating models that enable them to survive. Nevertheless when it did close, it was a shock. In terms of rebuilding our Cornish operation, it probably put that process back a year. We were back in fire fighting mode.

“At the time we had 180-200 drivers and a fleet of around 120 vehicles maintained from Camborne. We were operating from there, Helston, Penzance, Falmouth, Truro and at the Eden Project.

“Western Greyhound closed on a Friday and we worked really closely with Cornwall Council to get as much of its network as possible up and running by the following Monday morning. However, scaling up to what is now a fleet of more than 220 vehicles and employing twice as many people was a huge challenge and was to take much longer. With around 400 staff we have become one of Cornwall’s biggest employers.

“Just the volume of drivers was difficult and we were taking on people who had worked in a very different culture. A lot of them were used to particular shift patterns on certain days of the week and in specific locations. I think many of those who joined us at the time have since drifted off to do something else because they didn’t want our more rigid work patterns.

“Vehicles were a huge issue as well and we operated an eclectic mix for a while. Some were former Western Greyhound buses and other operators gave us what they could spare. What’s more we didn’t have premises in the north of the county. We subsequently expanded our outstation in Padstow and bought Western Greyhound’s Summercourt garage, but that was probably six months after the closure. There were vehicles parked in yards all over the place. Just refuelling and cleaning them was a challenge and it took a long time to get the business functioning back at the level it had been.

“We had previously worked through our depot infrastructure requirement to ensure we had what was necessary, but with that massive fleet increase we had to go through that whole process again. Truro was expanded as a workshop and maintenance is carried out at Summercourt, but even now there’s more to do. We’re spending £0.75m mostly on a project to refurbish and reopen Penzance garage as a maintenance centre. Our coach fleet will be maintained from there and during the summer the allocation will be more than 70 vehicles. There are plans to install a MOT test station and a drive through wash. It will be money well spent because we have to make the Cornish operation truly robust.”

A pair of Wrightbus-bodied Scania L94UBs have been painted in Atlantic Coasters livery for the A17 between Pendeen and St Ives. ANDY STOPPARD

Marketing Kernow

“Until we had a business that met a certain standard, there was no point marketing it,” Marc continued. “We deliberately avoided doing that until we had the network and fares right and most of the vehicles were at least in half decent condition – a process that is still ongoing.

“There was a big deliberation within First UK Bus as to whether the First name and livery should continue to be used in Cornwall, but it became clear that with the potential for franchising, we needed to better understand the value of localism. Our Cornish network is big and quite disparate. We don’t get travel right across it, just in pockets, but we concluded it was still important to have one brand that was common to the whole because there are crossover flows. Connectivity was essential, particularly as we’re selling to tourists so we’ve committed to rolling out the two-tone green livery that Ray Stenning at Best Impressions has designed as our new default network livery. There is also a new strapline, ‘Cornwall by Kernow’.

“Ray has also been charged with creating a series of sub-brands because we have some very strong mini networks and routes particularly in the west of the county that we wanted to highlight. Four of those identities are now in use and when people see any of them they will recognise the common livery style.

“A two-tone red livery is carried by the 20 new Enviro400 MMCs normally used on The Tinner, our core high frequency, commercial T1 and T2 routes connecting Truro, Camborne, Penzance and St Ives and primarily serving the needs of local people. There is also a T3 that runs between Truro and Truro College during term time.

“University services U1-3 in and around Falmouth and to Truro and Redruth use another 10 Enviro400 MMCs in a two-tone blue livery backed by three similarly-painted older Enviro400s.

“That operation is the fastest growing part of our network – a real success story that has developed from the strong partnership we have with Falmouth and Exeter Universities at their combined Penryn campus. While what we do is part contracted, most of it is actually commercial.

“The Tinner and university buses are probably the first new double-deckers for Cornwall since National Bus Company days and they’re not ordinary vehicles either. High-backed seats have E-Leather headrests and there are USB charging points and free WiFi. The Tinners have three tables upstairs as well.

“Then there’s the Penzance-Mousehole M6 route which uses three of the shortest Optare Solos in the fleet painted in a pink-based livery. Feedback from the residents of Mousehole has been massively positive. It’s a very busy route and clearly one where there’s an opportunity to attract more patronage from visitors.

“The fourth livery using different blues to the university buses is Atlantic Coasters – a fleet of 22 vehicles that are a mix of part open-top and closed-top Plaxton President Volvo B7TLs and Dennis Tridents, and a pair of Wrightbus Scania single-deckers working a mini network of six routes. While there are regular flows of local people on those services, this is very much a tourist orientated operation and we think it has the most potential for passenger growth. The branding is particularly designed to appeal to visitors and entice them on-board.”

Topless attractions

“The first Atlantic Coasters service to be so branded was the A5 between Padstow and Newquay using closed-top Dennis Trident Plaxton Presidents,” said Marc. “Then there’s the seasonal A4 linking Newquay with St Ives using two of nine part-open top Plaxton President Volvo B7TLs that we’ve converted in-house at Camborne for this season – a £0.25m investment. The remaining Coasters routes largely cover what was previously the seasonal circular 300 service. St Ives to Land’s End is now the A3 using part open-top B7TLs as does the A1 (Land’s End-Penzance) and the A2 between Penzance and St Ives. However, the A17 linking St Ives, Penzance, St Just and Pendeen runs all year with the two single-deckers, a pair of closed-top ’deckers and more of the part open-toppers during the summer.”

In addition to the nine recently converted part open-top Volvo B7TLs, an open-top Atlantic Coasters-liveried Northern Counties-bodied Volvo Olympian is being parked during the season at Penzance bus station to stimulate passing trade. There is also an open-top Alexander-bodied Volvo B7TL in the fleet that’s based at Falmouth.

Continued Marc: “The Atlantic Coasters mini network was introduced this summer and is effectively our first credible, marketable tourist product. A dedicated leaflet with a route map has been designed by Ray and produced in partnership with the National Trust. In it we advertise all their attractions along those routes. Atlantic Coasters bus backs are also being covered to highlight different National Trust properties because it all helps to promote days out and walks by bus. We’ve also moved our Penzance travel shop into the National Trust Welcome Centre and I think this is a partnership that we expect will grow.

“The issue we needed to understand was that visitors don’t normally buy a ticket just to ride on a bus. They want to be able to do something at the end of their journey and if we’re going to grow patronage, we have to develop those opportunities. The National Trust owns most of the coastline around Cornwall so is a key partner. It is also keen to increase the number of people visiting who aren’t in cars.

“We see Atlantic Coasters as an opportunity for a whole series of partnerships with guest houses, café owners – whoever might mutually benefit. It’s this year’s big brand for us and we plan to develop it as much as we can. We’re also formulating plans to revitalise our routes down to The Lizard and that might be an opportunity for another new sub-brand.”

Spreading the word

“As a business we have to work within our limitations,” observed Marc. “There isn’t a graphic design or big marketing team here. Our two marketing people drive a school or college run morning and afternoon while our three roadside staff do the same. There’s a whole series of people we employ who do that and do something else in between. We want to be able to do everything, but the model we use must reflect the size of our operation. Clearly we can’t afford one person for each function.

“For what we can’t do ourselves, we use Ray and we’d actually started repainting buses in a different version of two-tone green prior to the introduction of the current scheme. Around 20 vehicles have been so treated. While a lot of the repainting is being outsourced, not least because the team that would do it in-house at Penzance have been working on our open-top conversions, we do what we can. In an ideal world we would do everything, but we have some catching up to do.

“Where we’ve branded a route we’ve changed bus stop flags to match and on the vast majority of the network we’ve also replaced old flags with ones in the latest First corporate style. Western Greyhound used a different series of route numbers and we’ve tried to remove everything that’s no longer applicable although that’s still work in progress.

“Actually, Cornwall Council Growth Fund money is funding a revamp of roadside infrastructure so what we’re doing will effectively only be temporary. The plan is that the Council will replace all the bus stop flags and timetable cases and we’ll provide the labour to put it all up. It’s that partnership working again.

“I’m a great believer in producing a network timetable book with a map where there are passengers making at least an element of their journeys across different routes and especially when a large number of them are tourists who want to explore the available travel opportunities. If we didn’t produce a book, we’d end up creating a lot of timetable leaflets, yet they would all carry the same map and fares information.

“One of the first things Alex and I did when we got involved was to produce that book and it’s acclaimed by everyone we talk to. It’s an expensive commitment. We’re publishing twice a year to cover both the summer and winter timetables, and we’re giving a lot of them away – probably around 140,000 annually. That makes it our biggest single investment in information and publicity, but it underpins everything else we do.

“A separate timetable leaflet is produced for Atlantic Coasters because we’re particularly targeting that at tourists. One is also produced for routes 95 and 96 to Bude in the north of the county because it’s less likely that users would use the rest of the network. It’s a distant and quite distinct operation.”

Hearts and minds

“Our web presence is something that needs to be worked on,” Marc said. “While we have to go through the First UK Bus website, we’re allowed to build our own pages within that. Using the core functionality, we’ll be adding layers that reflect we’re a bus company that is reliant more on visitors, but it is work in progress.

“I’m a great believer that at all levels of the organisation we have to be receptive to customers. We can’t just hide behind call centres and info@. While First has a regional call centre in Norwich that supports us, we do all our own social media. Twitter for all our live running information and we’ll feed that through Facebook as well.

“At least half a dozen of my managers and me will have a Facebook page open on our phones so we can deal with incoming messages. I recently handled a lost property enquiry. Someone had mislaid two bottles of wine in a black carrier bag on one of our Tinner buses. There’s nothing that surprises people more than when they get a reply at 0100hrs that says we’ve contacted the depot. If they ring such and such a number after 0730hrs we’ll be able to tell them if we’ve got their property.

“I think we’ve gone from an organisation that was probably a little frightened of writing anything on social media to one that’s really transparent. When we get it wrong, we’ll put our hands up and say, we’ve got it wrong.

“All our controllers are required to tweet every single interruption to service and to give the honest reason as to why. They’re not allowed to say, ‘due to an operational reason’ because we need people to believe we’re being honest with them.

“Using social media has been a really good exercise in making us as an organisation more open and enabling us to understand better what we need to correct and where we can make improvements. It’s all about winning hearts and minds inside as well as outside the business.

“Alex and I have had the conversation on several occasions as to how we go about telling staff what we’re going to do and the implications. I’ve said, it’s all very well telling them, but they won’t believe us until we actually do it and they can see the proof. Often it’s better to just do something and let the results speak for themselves. There has to be an acceptance of where we’re starting from in the minds of many of our people and an understanding of the cynicism they might feel.

“The biggest tangible change we’ve been able to make was introducing those new double-deckers. I think for many that was the point where they could actually start to believe. We also reached a two year deal that started to address some of the issues about historic pay levels. There is a starter and intermediate rate, but once drivers have been with us for two years, they will earn the magic £10 an hour.

“People in Cornwall are very proud of their county. That’s true for our staff just as it is for everyone else and they’re also very proud of the company they work for. Buses are important at a very parochial level. We have eight depots and outstations spread across the county, some with only single figure numbers of staff, but we try and engage with everyone.

“When I go into the canteen at Camborne garage to talk to staff, I find we have a common purpose. What’s important to many of them is we’re providing all year round stable employment and with the business coming from such a low base, the vast majority want us to look smarter, to act smarter and to have more passengers travelling with us. That doesn’t mean we don’t have disagreements and challenging issues to deal with. It will always be the case that some people are harder to turn than others, but it has not been difficult to get the majority enthusiastic about what we’re trying to achieve. That’s has been part of our success. So many of our staff have really engaged and embraced change.”

Going contactless

The impact of Growth Fund money in Cornwall can’t be underestimated. In early July First Kernow became only the second subsidiary within First UK Bus to completely go over to using Ticketer ticket machines. First Aberdeen had been the first. The equipment has been paid for using money from £8m of Growth Deal 1 funding secured by the Cornwall and Isles of Scilly Local Enterprise Partnership, Cornwall Council and the Council of the Isles of Scilly as part of a much greater £198m Growth Deal 1 and 2 allocation from the Department for Communities and Local Government, Department for Business, Energy & Industrial Strategy, Cabinet Office and Department for Transport.

“Ticketer brings real-time information to our entire Cornish network, which is a great advantage,” explained Marc. “We’ve not had full coverage before, just on a small number of vehicles fitted with earlier Ticketer systems. Ticketer means there’s no need for a secondary system and there’s an app in development as part of the project.

“What is more, we’re able to accept contactless and Apple Pay and Android Pay are ready to go. Cornwall had Growth Fund money available to buy Ticketer and it means that in the space of a few weeks we’ve moved on a decade in terms of the information we can provide customers and ease of payment. We get better travel pattern data and further down the line, the ability to cap fares which will be a big benefit in developing our offering to commuters.

“I think being able to offer contactless is more significant than any of us realise. The cost to this business of banking cash is considerable so reducing that is good, but more importantly it’s about making it easier for people who aren’t familiar with our services to travel on them.

“For example, our family day ticket is £24, but how many people carry that sort of cash? If they do, it’s probably only really there for emergencies. Even if they’re happy spending it, they might have anxieties about having the correct money to avoid any embarrassment with the driver. If they don’t have the cash, would they then need to find a cashpoint? The impetus to travel could be lost. Contactless removes all those hurdles. It means two adults on holiday with as many children as they want – there’s no limit with our family ticket – can board an Atlantic Coasters open-topper just on a whim.”

First Kernow undertakes a significant amount of planned rail replacement work for Great Western Railway. Pictured at Exeter St David’s station is the ADL Enviro400 that was painted in experimental The Buses of Cornwall livery. KAMERON ALLAN

Working with GWR

Said Marc: “There’s a real commitment within First and wider through the Growth Fund partnership with Cornwall Council to integrate marketing and ticketing as best we can with GWR. It’s a key objective over the next two years.

“Connectivity will be easier because of a rail signalling project that will shorten a lot of the signalling links in Cornwall enabling GWR to operate two trains an hour rather than just one. A clock face timetable will be easier to connect with and we’ll tweak the bus network accordingly and see how we can integrate timetable information and promotions.

“First South West undertakes a significant amount of planned rail replacement and that’s the main reason why we’re painting all our coaches in GWR green. There are actually eight that are permanently available to meet that requirement although they’re also used on other commitments. Another four are frontline vehicles and quite a number are employed on school and college contracts.

“In all there are more than 30 coaches including several Mercedes-Benz Vario midis. We’ve inherited First’s fleet of Greyhound-liveried Scania Irizars and as well as being repainted, we’re having them up-seated. The push at the moment is to maximise the utilisation of all of them. We already do a significant amount of National Express duplication work and that’s a growing relationship that seems to be developing well.

“An unusual vehicle is the dual-doored Plaxton Pointer Dennis Dart that GWR has acquired from Ensignbus for use as a bike bus. It has been repainted and our Penzance bodyshop is installing bike racks to complement the luggage racks already fitted. GWR will use it wherever it has a rail replacement requirement. That could be anywhere from Penzance to London.”

Taking stock

“I’m pleased with what has been achieved so far,” concluded Marc. “I would have liked to have been further on, but the demise of Western Greyhound really set us back. It cost a lot of money scaling up at the time and it meant we weren’t able to develop patronage on our existing network during the 2015 summer season like we’d hoped.

“There is always a frustration over the speed at which we can take the business forward, but a real positive is the relationship we now have with Cornwall Council and our other stakeholders. It is exceptional and that’s so important to us. Building those partnerships is the foundation on which we grow this business.

“The commitment that First UK Bus has given us is superb. It has bought into the business model, into the new image and has invested a significant amount of money. Giles Fearnley (First UK Bus Managing Director) gives us his full personal support and that’s valued both within and outside the company.

“This business is now profitable and the number of passenger journeys is on the increase. Not just because of Western Greyhound closing – organically as well over the past two years.

“That’s the real message. Working in partnership with Cornwall Council is delivering patronage growth at a time when it continues to decline in much of the rest of the UK. The message to Government is that we’re using the Growth Fund money well and there are still real opportunities for us to develop.”