Fraser HarperA haulage industry specialist has earned itself £131,000 of government incentives after creating a revolutionary online distribution platform for vendors and independent hauliers.

The parcel and pallet delivery sector is currently made up of approximately 300 UK-based pallet firms, plus 3,000 freight forwarders, but only large national and international delivery companies allow shipments to be booked online.

Distribution specialist, E-Gistics Ltd, spotted an opportunity to bring smaller operators together so customers could access instant online quotes and easy shipment monitoring for deliveries handled by more than one independent haulier.

No solution like this has been available to the industry before, and with the help of R&D tax specialists Catax, E-Gistics was able to make its substantial claim for R&D tax credits. 

The distribution sector has been expanding rapidly in recent years, however, the software being used by new entrants to the market is typically still stand-alone, with little or no compatibility with other companies’ systems. The pandemic has brought renewed focus on how technology may be able to increase that rate of growth among smaller operators. 

The firm has seized on this opportunity to build the first digital platform to seamlessly connect companies on both sides of the transaction — allowing businesses to access easy-to-use portals and coordinating the services and pricing of numerous SME distribution companies so all parties can lower costs and increase efficiencies. Transparent pricing is made available instantly online and some clients have been making savings of more than 19%.

Fraser Harper, CEO of E-Gistics, said: 

“The freight forwarding sector has a digitisation requirement but some companies have been unsure how to go about it. 

“In the end, it was probably inevitable that a third party software specialist would bring them all together and that’s what we’ve done. 

“Digital freight is destined to become more like other areas of the transport sector where automation and digitisation have turned things on their head. Uber in the personal transport space is a prime example. 

“We knew we were investing heavily in technology, and tax incentives like these make it so much easier to continue to do that. The Government was clever to introduce this scheme. It encourages businesses to invest in technology and if companies don’t embrace digital these days, they don’t have a great future ahead of them.”

The platform has already helped a furniture and household goods auction house distribute stock around the EU, using the E-Gistics platform’s dynamic pricing once a winning bidder was identified. 

The company is also a great example of how R&D tax credits can be earned for work that has not in fact been successful. The firm had planned to develop a delivery solution for medical prescriptions, which was particularly timely in light of the pandemic, but this project was not successful because the use of the word ‘drug’ on online orders meant payment gateways rejected the transactions. This was outside the company’s control and the project had to be suspended, but all the qualifying R&D expenses that went into it still qualified for relief.  

Richard Armstrong, Partnerships Director of specialist R&D tax consultancy Catax, said: 

“Fraser and the team are a great example of a SME that is using the R&D tax credit regime to support the future growth of their business. 

“Technology is at the heart of what they do and their innovations promise to revolutionise the way the parcel delivery sector functions, not just in the UK but across Europe.

“It’s important to remember that R&D tax credits still apply to projects that don’t succeed. There really is no good reason not to innovate with such valuable incentives on the table.”