Crosshire 

Weathering the Storm

Executive Hire News, November 2008         Go to main Crosshire page

During one of our quieter times recently, a couple of my younger  staff asked me about what would happen to our business and, of course  their jobs, if the doom and gloom being forecast in the national  
media was as bad as it appeared. It only struck me at that moment  that the thick end of two generations had not experienced a recession  or prolonged period of difficult trading. The matters in the news  during September and October were alien to them, so it was not surprising that anyone under 30 was concerned as they had nothing to  measure the latest situation against.

I was proud to inform them that our industry had always proved to be  resilient during troubled times - mainly due to the fact that the  majority of users of plant and tools did not want the expense of owning or managing them in the good times, let alone change policy and start purchasing them now! Good engineering and service-led hire companies will continue to trade through the present mess. However, those who pander to the whims of accountants and assorted consultants, may not fare so well. Yes, we need to be vigilant;  
complacency and poor credit control are possibly our worst enemies.

I am already hearing tales of increased bad debts from some of you and, not surprisingly, many punters are back-pedalling on their  ayments. However, on balance, we are probably in a better position now than we were at the last time of crisis in the early 1990s. Some of you will remember that then the ‘kick down’ in contract size saw many local and regional contractors suddenly finding themselves in competition with large national construction groups for relatively low value jobs. This was because the big boys had no work! To keep body and soul together, I can remember national names tendering for jobs that previously were the domain of local family building contractors just to keep key staff working. This time round the same  
politicians that have got us into the present mess will not want more egg on their faces by cancelling large infrastructure jobs and sending the big boys scurrying after crumbs in the regional or private sectors. Indeed, as I write this, the Olympics have been bailed out again with a further donation, on our behalf, by that nice  
Mr Brown.

The commitment to Crossrail, airports and other transport infrastructure continues and we are planting those bloody windmills everywhere at great expense. The capital spend on the electricity grid that will be needed to cope with the windmills and the new nuclear power stations is huge, but it is all dwarfed by the cost of those power stations themselves! The spread of work between the national contractors and the smaller outfits almost mirrors the supply chain that our industry has built up over the past ten years  
so there is plenty to go at.

Almost by default we have now got some reasonable long term planning  taking place and, unbelievably, politicians now seem capable of seeing beyond the result of the next election. All this must bode well for the hire industry because we are ahead of the game in many ways. Most fleets are relatively new and, whilst we may understandably back off with some renewals, I am sure that our industry will weather the storm better than many.

Ongoing www.askmid.com debate

My call for vigilance and co-operation in previous months seems to be paying off as I know many of you have signed up already and are  taking part in the Executive Hire Club. I know of one definite result  where, by using the ‘askmid’ web site, a hirer avoided a scam and secured the arrest of the vehicle driver because it turned out that the car he was driving was stolen, as well as being uninsured. I am still waiting for a favourable response from the ‘askmid’ people regarding third party use of their site, but, in the meantime, I, and many of you, are using it for legitimate purposes. There is a good debate on the Executive Hire Club site regarding theft and plant crime, your input would be worth while. We have just had the complete  
nonsense of someone who was caught with stolen plant being let off by the court on a technicality. I bet if he had nicked the Judge’s lawnmower he would have been banged up quick enough.

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