EVERY business has a first year and, although the maritime group Louis Dreyfus Armateurs was founded 120 years ago, it only launched its cross- Channel ferry service in 2005.
Group chief executive officer Pierre Géhanne, the chairman of LD Lines, explains how it all happened. Mr Géhanne lives in Suresnes near Paris with another home in Carteret in La Manche.
How long have you been in business?
The group Louis Dreyfus Armateurs was founded 120 years ago but our subsidiary company Louis Dreyfus Lines began its activities in the passenger ferry sector in 2005. It is still a new activity for our group and it is developing well, by steady growth internally and externally.
Why did you choose to do it?
It was an opportunity which presented itself unexpectedly. To be perfectly honest, we hadn't envisaged going into such an industry.
We were approached by the chamber of commerce and by the port of Le Havre after P&O shut down its service to Portsmouth. It was a dramatic situation for Le Havre.
We studied the idea, spoke to all the parties involved and decided to launch the venture.
It was new and motivated all our staff. I have to say personally, I found it - and still find it - great fun.
What type of business are you (Sarl, micro etc) and how much did it cost to set up?
Louis Dreyfus Lines is a subsidiary of LDA which is a family business with a turnover of more than one billion euros. The activities of LDA revolve around maritime transport; we are ship owners above all but we also cover fields like ship construction and logistics.
LD Lines is specialised in maritime transport with vehicles, passengers and freight. We play a big part in the 'autoroutes of the sea' operating with Grimaldi between Civitavecchia and Toulon. To start our Le Havre to Portsmouth line we had to, obviously, buy a ferry - an investment which starts around 50 million euros - which isn't a negligible sum.
What was your expected income?
All entrepreneurs hope to earn a lot of money with their business. That said, with LDA we learned a long time go that you need to be patient - no doubt that's the reason we have been around for 120 years. In 2007, two years after its creation, the ferry services was already breaking even with encouraging prospects.
We see this business as a developing field and we have a lot of projects ongoing. Our strategy is long term.
What were the hurdles?
Our ferry service represents less than 10% of our global turnover for LDA but we certainly invested more than 10% of our time.
One of the main challenges was finding the staff to rapidly launch this service without any serious delay or major running problems. The main hurdle was trying to change people's habits and mentalities.
What would you have done differently?
Launching such a business in the space of two of three months, in a sector that was completely unknown to us, was a challenge enough and put a lot of pressure on us and our partners. It all turned out well but, if we went back to do it again, I think we would give ourselves a little more time to get started.