25.03.2009

Lavendon agrees UK restructure

Lavendon, the world’s largest aerial work platform rental specialist has agreed a restructuring plan for its UK business following a period of consultation with its employees. See Grant Woodward leaves Lavendon in which they were informed of the need and asked to contribute ideas and initiatives.

The plan will see some further merging of operational functions including the adoption of a single operational management structure, a 15 percent reduction in its headcount which equates to the loss of 150 jobs and the closure and merger of some locations.

As already announced Peter Douglas, currently managing director for Nationwide Platforms North, will take responsibility for all UK depot operations for both Nationwide Platforms and Panther, while Richard Miller, currently managing director of Panther, will be responsible for all sales and marketing for the two businesses.

The company will maintain and build on its two brand strategy, with Panther operating as a regional – more personalised operation – while Nationwide Platforms continues to build on its ‘national’ and major account business model.

The consultation has highlighted a number of locations where duplication is not delivering the required benefits or where the group has – due to its aggressive acquisition policy- an over heavy presence.

In such cases the weaker brand or location will be merged into the stronger. South East England is one such case where three locations will be closed. Birmingham, with four locations is another with Droitwich set to close.

The company says that it expects the current slowdown to last into next year, with construction expected to lag behind any pick up due to the current fall in building starts. The policy of growing by acquisition had left the business with an overly heavy mid and senior management structure, and that this move, while hard, is intended to put the company on a strong footing to weather a prolonged downturn.

Vertikal Comment

Lavendon’s consolidation efforts in the UK market, while having turned the business around and given it a renewed lease of life, have also left it with a great duplication and overlap, some of which had been dealt with and some that had not. With an increasing pressure on profits such duplication could not be ignored, particularly by a publicly owned company which has to explain such things to unforgiving investors.

Streamlining the business now will allow cost savings to flow through for at least the second half of the year and will arguably put it in good shape to benefit from the upturn when it comes.

The challenge though will be to maintain the different more personalised and specialised culture at Panther, given the further merging of the group’s operational management. The slimmer senior management structure could make this easier, although there is also a possibility that the two cultures will morph into one.

As long as they reach a place that suits the majority of the Panther and Nationwide Platforms customers and staff, all will be well. If not the current streamlining will inevitably have put some good people on the street who will be more than happy to help others take up the slack.