Executive Hire News › Archives › August 2009 › Market Report : Growth business
Market Report : Growth business
By supplying the right kit and efficient backup services, hirers are profiting from opportunities in the grounds care market. Alan Guthrie talked to some of them.
Although under economic pressure from the current need to decrease public spending, local authorities still have to give a high priority to maintaining parks, highway verges and green spaces in their care, and so the need to procure equipment cost-effectively has perhaps never been greater. Such customers represent the majority of clients for SGM (UK), now the only specialist grounds care hirer operating on a national basis, with depots bounded by a triangle cornered by Gleneagles, Pontypridd and Bexley. “Not surprisingly,
the market has been difficult to predict this year,” says MD Steven McInroy. “We anticipated an initial rush of interest, particularly from local authorities facing reduced capital budgets. However, initial demand was patchy because of the damp, cool weather that delayed the grass-cutting season, and obviously councils will only order machines when they need them. However, business picked up dramatically once warmer conditions arrived, and we had an excellent June.
“Hire remains an attractive proposition for local authorities and golf courses with budgetary restraints. We are being as flexible as possible. Customers who do not need brand new equipment are happy with used machines that have been maintained by us to a high standard, and we can charge a sensible rate. Clients also know we support our fleet with prompt field backup. Similarly, our buying power means we can obtain spares at excellent prices, and, as well as supplying parts to end users, we can save customers money by servicing equipment they own.
“We continue to add to the fleet, having spent about £250,000 on new kit already this year. We have bought a Gizmow ride-on mower from GGM (Gibson’s Garden Machinery), a zero-turn machine that has a conventional steering wheel rather than handles, and Stockport MBC is using it for mowing in cemeteries. We also added two Etesia Hydro 124 cut-and-collect mowers for Manchester City Council. We are exhibiting at IOG Saltex next month and will give details of a new HAV management system that will enable us to log data remotely and advise grounds care professionals on managing operator exposure, perhaps by using different equipment.”
“Business remains excellent”
For another specialist in this market, Browns Groundcare Hire of Leighton Buzzard, “business remains excellent with no appreciable change compared with last year,” according to Hire Manager Andy Lathwell. “If anything, our hire turnover is up. We are doing steady business with cost-conscious local authorities, golf courses and sports clubs, although some landscape contractors are being affected by the downturn in house building. There is a steady demand for Kubota and Hayter mowers, Timberwolf chippers and other items.
“We have just opened another hire depot at the Browns dealership in Chelmsford, under Hire Manager Dave Salmon. It will serve customers throughout Essex, southern Suffolk, north Kent, and south and east London, who we could not realistically support from Leighton Buzzard. We have invested significantly in new kit for Chelmsford, and we know there are new launches planned from several manufacturers that we will be adding to the fleet.”
The Golf & Turf Equipment dealership of Wokingham, part of the Burdens Group agricultural and grounds care machinery distributorship, is celebrating 20 years of operating its specialist Turfleet Hire activity. “Hire has been phenomenal for us in the last few years,” says Operations Director Simon Reynolds. “Turnover will dip slightly this year because two large contractors have decided to buy significant fleets of certain core products from us, like John Deere mowers, which previously they hired. They obviously still hire other items. We are constantly increasing our customer base, and continue to augment and replenish our fleet, having spent £150,000 already this year.
“Our northern branch in Lincoln is performing excellently, with approximately £1m worth of equipment now in its fleet. We are also talking seriously to a local authority in the north west of England that might hire a significant amount of equipment, and this would necessitate establishing another satellite location to ensure a rapid response. We have even won business supplying mowers in north Wales, with in-field support arranged through a local John Deere dealer to ensure rapid response. Overall, demand is strong for specialist items like deep aerators, scarifiers and seeders for renovation. In fact, customers are already reserving machines for autumn 2010, because they know it gets booked up so quickly.”
Waiting lists
Similarly positive is Ritain Patel, Director of Acacia Groundcare Equipment Rental in Henfield, West Sussex. He reports “so much of our kit is on hire at the moment that we are putting people on waiting lists for items like mowers and tractor attachments. We serve an area covering Greater London, the south east, Kent, Sussex, parts of Berkshire and the south coast. We also get enquiries from people as far afield as Sheffield and Wales, who find us via the Internet. These are too far outside our area, but they show the level of demand.
“Being independent, and not linked to a dealership, we can offer a wide range of equipment, with brands such as Stihl, Ransomes Jacobsen, John Deere, New Holland, Sisis, GreenMech, Eliet and Indespension. Certain machines are incredibly versatile, such as Barreto trenchers from The Hire Supply Company, which can be used to drain farmland or create channels for electric cables without having to hire a mini excavator. A key factor for success in ensuring all machinery is well maintained, delivered on time and with prompt backup in the field.”
Tree surgery specialist G.A. Butler & Sons of Newbury established a hire operation five years ago, supplying equipment to local authorities, contractors and homeowners, such as remote control stump grinders, chippers, tracked elevated work platforms, and mini excavators with attachments like augers, timber grabs and stump grinding heads. “Much of this equipment is specialist machinery that many professionals cannot afford to buy themselves, especially smaller contractors, so hire is an attractive option,” said Director, Stephen Butler. “We are within an hour of London, Bristol, Banbury, Cheltenham and Gloucester. Our Octopussy 27-14 platform has even been hired by a customer in Glasgow. It can track through a 1.7m gap, extends to 27m and offers 14m of outreach.”
Expansion into gardening equipment
However, grounds care equipment hire is not the exclusive realm of specialists. Independent hirers are profitably targeting this segment. Ian Truby, Proprietor of Truby Tool Hire in Cornsay Colliery, Durham, said “Last year we decided to expand into gardening equipment, adding Camon scarifiers and tillers, and hedge cutters and strimmers from Stihl and Jonsered, amongst other items. They have proved very popular with landscapers and homeowners, and we can achieve a good hire rate. It’s one of the best moves we’ve ever made.”
Similarly, Wes Mintram, Tool Hire Manager with Gardner & Scardifield of Worthing, finds that “demand for equipment like our Camon C90 chippers, Birchwood Garden Master mowers and Kawasaki brushcutters and strimmers is constantly high. Customers currently split approximately 75/25 in favour of homeowners over tradesmen, whereas in the past it was 50/50. People are doing more themselves, such as growing food in allotments, and as soon as someone hires, say, a rotavator to prepare the ground, everyone else gets the idea.” • |
