New research explores strategies for, and likely timing of, recovery in plant and tool hire

Sept. 25, 2012 - PRLog -- These are both large markets, estimated at a combined size of over £4bn. Prior to the onset of recession in 2008, they enjoyed a combination of high growth and attractive margins. Penetration increased with new customers adopting hire models, existing customers uses it more and the hire range and service offer extended to new areas.

Benefits to customers include high levels of availability of the latest equipment at the right location and in good working order, freeing-up capital, outsourcing the costs of ownership – including repair and maintenance, equipment testing, storage and inventory management – as well as any liabilities and simplifying the charging of equipment costs to specific jobs.

The downturn of the construction industry and the housing market in 2009 meant that many hire companies were forced to reduce headcount levels and fleet sizes to match lower revenues. However, the research carried out by business intelligence organisation, Apex Insight, has revealed that some companies have successfully managed to increase revenues from opportunities offered by infrastructure projects, sectors other than construction, add-on services and overseas markets.

Leading hirers, including Speedy Hire, HSS, Aggreko and Nationwide have all chosen to explore adjacent areas; shifting their focus away from their traditional core focus of construction and instead making the most of opportunities offered by the utilities, manufacturing and maintenance service sectors.

Diversification into a range of value added services has seen the likes of Speedy Hire launching a suite of engineering and managed services and HSS delivering health and safety programmes through its training arm and Hewden Stuart offering plant resources for event companies.

Outside the UK, the Middle East has been identified as an important growth market for tool hire. Qatar and UAE in particular, have been selected as attractive targets due to major infrastructure, housing and hotel developments currently underway.

“Although the forecast for the plant and tool hire industries are likely to make depressing reading for the short term, some organisations have been able to maintain or even grow their revenues and are seeing opportunities in the challenging economic environment”, says Frank Proud, director at Apex Insight.

For more details on the reports please see here: http://www.apex-insight.com/research/