New year, new opportunities
1 January 2021
So here we are. Welcome to 2021, which seemed so far away when the March lockdown was announced.
What might we expect? For fear of sounding trite, one thing is certain: uncertainty. Debate about more lockdowns, circuit breakers, tiers of regulations and other measures does not go away. And the impact on employment when the twice-extended furlough scheme eventually ends on 30 April is hard to predict.
There’s also talk of price rises of raw materials like steel and disrupted supply chains caused by delays at container ports.
However, there are also positives to consider. And the most important of these is the rollout of coronavirus vaccines that is already under way. Just two days ago another jab was approved, from Oxford University/AstraZeneca, which should speed up the inoculation programme.
In addition, the unexpected Christmas Eve announcement of the Brexit trade deal between the UK and the EU - four-and-a-half-years after the European referendum - gave a welcome sense of closure, although there will inevitably be issues arising that need to be worked through as new administrative practices are adopted.
While some hire markets have been hit extremely hard by lockdown measures, including hospitality and events, construction activity has bounced back more strongly than anyone could have imagined. From people on furlough building patios, to HS2-related projects, there's been a lot of work going on.
It was striking that, when announcing half-year results for Ashtead Group (Sunbelt Rentals’ parent) last month, chief executive Brendan Horgan said that the business was performing better than the best case scenarios envisaged when the Group modelled a range of possible outcomes at the start of the pandemic.
Having initially forecast revenue growth in the Group’s current financial year to be flat, Ashtead now believes that the eventual figure could be 15% to 20% up. And other hirers are similarly upbeat, judging by many of the stories on this blog in recent months. Who would have predicted that nine months ago?
Brendan Horgan also pointed out a number of trends that should resonate throughout the wider industry. Most significant is the ability to adapt.
For example, Sunbelt Rental UK’s work for the Department of Health in supporting 87 drive-through Covid-19 testing sites and 197 walk-in locations has identified a greater role it can play in providing dedicated facilities management services in its portfolio. What new opportunities are there for your business?
Moreover, in fleeting-up for this pandemic-related activity - amounting to 20% of its revenues in this period - Ashtead has embraced this as an opportunity to explore and invest in greener technology. This is a trend that will grow in importance for all hirers. Are you ready for these developments?
Similarly, market unpredictability has caused many businesses to hire, rather than buy equipment, and not just in construction. For example, Sunbelt has seen demand for floor cleaning and maintenance machinery for use in retailers’ warehouse facilities, airports and other public spaces.
This again highlights how hirers can gear up to serve new markets – created because of, rather than in spite of, the pandemic. Those companies that are operationally agile enough will benefit.
And we are already seeing this in practice. For example, in a social media post on Christmas Eve while he was delivering to customers, Alan Redpath of Redpath Tool Hire in Duns said that he was still working flat out: “Never in my 27 years in hire have I experienced demand like it.”
Indeed, Redpath Tool Hire is one of many hirers that are going to be opening new depots in 2021 - which you'll read about in a future post. Others include Alide Hire Services, GoHire, HALT Hire, Phoenix Hire & Sales, Smiths Equipment Hire, Sunbelt Rentals...
So I’m looking forward to covering stories like these on the blog in 2021, and other positive developments in these times of challenge and opportunity.
Happy New Year.
And tell me YOUR plans for 2021. Email me by clicking here.
Photo: M Harris/Pixabay