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Executive Report: ‘More than a match’ With the right people and products, and an eagerness to explore new markets, independent YHC Hire Services is successfully competing against larger hirers. Nigel Strickland reports from Yeovil. Back in September 1994, at the age of 23, Andy Parker and his 20 year old brother, Ashley, acquired a tool hire business in Yeovil that had experienced troubled times, and re-branded it YHC Hire Services Ltd. Many in the industry believed they faced a challenge too far in terms of financial constraints and a lack of business experience. However, 14 years on, as Managing Director, Andy heads a thriving business with a network of five branches in Somerset, serving a large slice of south west England from its Yeovil headquarters. “The original business had a good customer base, employed people with local knowledge and the fundamental elements were sound,” states Andy Parker. However, simply standing still was not an option, and within a year of taking the helm, the company acquired a competitor in nearby Crewkerne. Within months, this depot was relocated six miles away to Chard. “As a market town, Chard had a much larger catchment area, more chimney pots and a strong potential base of industrial customers. I felt then that the optimum radius for a branch to cover was around 20 miles, and Crewkerne was just too close to Yeovil”. Difficult to challenge Andy
believes
that
towns
like
Chard
are
too
small
to
arouse
the
interest
of
national
hirers,
and
offer
the
opportunity
to
carve
out
a
strong
niche
which,
once
established,
is
difficult
to
challenge.
YHC’s diverse fleet includes more than 50 mini excavators from 750kg to 8 tonne. Last year saw a major shift with a practically wholesale move to Takeuchi machines. “We constantly evaluate all parts of our business, and we looked closely at the reliability, serviceability and performance of all the minis on the market,” says Andy. “Takeuchi offered significant advantages and the decision has been vindicated with an increase in utilisation and, most importantly, an excellent customer response. “We have also noticed a slight reduction in demand for 1.5 tonne machines. An increasing number of customers buy their own machines, having the capacity to transport them with their own 4 x 4 vehicles. Our growth now is in 750kg and 3 tonne machines, together with tracked and narrow access dumpers. We also offer multi-functional machines like Avant Tecno multi-tool carriers and the JCB Mini CX, which are proving extremely popular with customers such as landscaping contractors.” Portable accommodation The business has also developed a local market for hiring portable accommodation. “Initially we began with 10-12ft stores and office jack-leg units, using our existing vehicles for transport. We had realised that many of our customers were hiring portable sanitation from us, but sourcing accommodation from other suppliers, so we knew we had a potential market to tap into. As with any product line, if enquiries indicate a viable market exists, then we will run with it and our fleet now exceeds 450 units. “Although there is an initial high capital expenditure, accommodation has a long product life, requires minimal maintenance and gives extremely good returns. We have also made a major investment in two HGV lorries with Hiab cranes, and the subsequent operational costs have been offset by using these vehicles to transport our bigger excavators as well. “Portable sanitation is a significant part of our business and we have more than 500 portable toilets on hire, serviced by three full-time pump lorries. All toilets have full-forearm capacity basins and we have an increasing number of hot-wash units. With a high geographical concentration of toilets within our trading area, we provide a very prompt service and strictly adhere to a weekly service schedule. Pricing in this sector is very competitive, with customer expectations also, rightly, extremely high. “We find that some competitors fail to grasp that good servicing is imperative, and they do not do justice to the industry or their clients. It is also noticeable that, when the order for portable sanitation is placed from a buying office, price becomes the key issue, whereas, when an order is placed by a customer who will actually be using the toilet on site, the quality of servicing is the key driver of the purchasing process.” Although the construction market generates 90% of the demand for toilets, Andy Parker sees the event industry as an important one and retains a separate fleet of Thal Mondo units specifically for these customers. These are migrated to the construction fleet after three years’ use. Responding to the environmental agenda How the portable sanitation fleet is managed demonstrates YHC’s commitment to environmental issues, and the company has accordingly changed some of its business procedures. “Seven or eight years ago, most sewage treatment works accepted portable toilet effluent and we used these facilities on a daily basis. But that has changed, and waste disposal is now restricted to major sewage works in key towns and cities. So we have invested in 25,000-litre bunded effluents tanks, and use an approved contractor to empty them on a weekly basis. “We also increased our pump lorry fleet to 7.5 tonne vehicles, gaining greater capacity, and installed tail-lifts and pressure washers to each vehicle. Using these trucks, by careful route planning utilising our MCS software system, and by choosing the latest environmentally friendly chemicals, we minimise our carbon footprint. Investment in solar powered lighting on some of our toilets has also removed the need for external lighting and the potential hazard of trailing cables.” Andy Parker is keen to point out how his company’s green credentials go further. “We evaluate all our operations from an environmental perspective and look to take the initiative by investing in potential new ‘green’ markets. Being environmentally pro-active makes good business sense, too.” Power tool sales As evidenced by the displays in each depot, power tool sales play a key part in this business, but with the likes of Screwfix, Silverline and several of the major DIY sheds almost literally on the Yeovil HQ’s doorstep, how does YHC compete? “I have never been convinced by the attitude ‘never sell to a hire customer’. As a tool hirer, we have a greater knowledge of what will best suit a customer, and can offer practical advice with an eye to the long-term relationship, rather than just making a quick sale. Our service extends beyond just sales and we operate a full repair service for many top brands.” With the ink hardly dry on YHC’s latest acquisition of Bridgwater-based Chislett Hire, the company anticipates a bright future. “Ten years ago, we set out a clear strategy for growth through opening greenfield sites, acquisition and organic growth. Bridgwater is the latest perfect fit in the jigsaw. More depots are planned and we firmly believe it when our customers tell us, a good independent hire business is more than a match for any national hire company. We have great staff, clearly defined goals and massive energy.” • T
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425613 Executive Hire News › Archives › May 2008 › Executive Report › ‘More than a match’
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