20.07.2006

Hewden to change crane strategy

Hewden has announced a new strategy for its cranes business today which will see it focusing on cranes of under 100tonnes from October 2006. The company says that it has already put “partnerships (re-hire?) in place for the supply of machines above 100 tonnes and that these will continue to be available on a nationwide basis”.

The new strategy will also see Hewden utilising its overall network of rental outlets to make cranes more widely available on a local level.

The change in focus will involve the disposal of nine cranes from its existing fleet which currently exceeds 220 operated cranes. The new strategy will also include a programme to improve the age profile of the fleet with the disposal of a number of older cranes and the introduction of new models to the fleet.

Mark Hierons, Hewden’s head of cranes, said: “Our strategy is concerned with improving focus on our core customer offering, enhancing the performance of the business, seeking areas for future potential investment and improving the efficiency with which we operate within the Cranes marketplace".

"From the 1st October 2006, the business will focus on cranes of up to 100 tonnes, as this has been identified as providing the area of best opportunity to serve our customers and deliver sustainable business growth.”

As a result of the new strategy, "a number of changes in responsibilities and staff reductions will occur. A consultation process has already started associated with the re-alignment. Hewden is committed to ensuring the fair treatment of all its employees and every effort to support any affected staff will form a central part of the consultation process” continued Hierons.

At this stage Hewden has, understandably, declined to comment on the details of its realignment, however Vertikal.Net understands that it will include the departure of 12 depot managers, 19 hire desk staff and 42 drivers. With three regional managers taking responsibility for the depots.

The company says that it is committed to consolidating its position as the number two provider of cranes in the UK and will continue to provide an offering that provides a platform for growth.

Vertikal Comment

This move by Hewden is not unexpected; the company has increasingly concentrated on “bread and Butter” mobile cranes, which are more in tune with its overall general rental business.

The crane and powered access rental businesses are very specialised, as most tool and general rental companies understand. To find a company that combines general rental with full line crane hire is almost as rare as rocking horse manure.

Since Hewden became a part of Cat dealer Finning, rumours have regularly circulated regarding the future of its crane hire business. This in spite of the group’s very significant investment in new cranes.

Hewden has been rationalising its business in order to make it more efficient by eliminating duplication of non customer contact functions and merging the general plant and tool hire businesses.

The problem has been what to do with cranes and access, even those companies that do everything from tools to boom lifts, usually keep the bulk of the access equipment in a separate specialist division. And cranes? Well they simply do not mix well with general rental.

If Hewden are to stand any chance of integrating crane hire with the rest of its businesses, it can only be with the taxi crane services. Possibly using specialist heavy crane rental companies as subcontractors for larger lifts.

With its new strategy, Hewden clearly understands this.

Even on this basis the company would do best to hand over the heavy lift work to a number of reliable local companies along the lines of the National Crane Group. The challenge though is how to pass over the larger lifts and still retain those customers for the day to day work.

A number of well managed local crane hirers have successfully managed to do exactly this, and left the big cranes to the specialists. It is much harder though for a national publicly owned company. Hewden will need to make sure that its crane hire service is second to none if it is to succeed.

A fleet of new, well maintained cranes, located across a well spaced depot network, with a few really good, knowledgeable, highly motivated hire desk staff regionally located and a team of well qualified and motivated drivers is the secret.

The question is: Are the profits from the crane hire business likely to be substantial enough to justify the effort required to get it absolutely right?