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The merchant’s tale

Alan Guthrie talks to Travis Perkins Group Hire Director, Richard Dey, about TP Hire’s steady growth, and how it integrates with the builders merchant’s wider business.

Perhaps one of the more surprising statistics contained in our Tool Hire Top Ten analysis was in the table listing the total number of outlets for each hirer. This showed TP Hire at the top, with no fewer than 319 (shading Speedy into second place). When we last interviewed Travis Perkins Group Hire Director, Richard Dey, exactly four years ago, that figure stood at 166, clearly demonstrating the subsequent growth in its hire operations.

These TP Hire outlets are within strategically selected builders’ merchants from the circa 700 branches of Travis Perkins and Keyline Builders’ Merchants. The 13 hire outlets in Keyline, also owned by Travis Perkins and chiefly serving the civil engineering contractors and utilities markets, are branded Keyline Hire. The merchant also owns home improvement retailer Wickes, although hire is no longer available through these outlets.

Of the total of 319, 188 TP Hire locations are main depots, with a hire counter within the merchant outlet, a workshop, a vehicle, and a dedicated hire manager, reporting to the merchant branch manager. The remaining 131 are ‘satellites’, which have a more modest equipment fleet comprising essential hire items, and which can be fed with other products as necessary from nearby main depots. In this way, Richard Dey believes that TP Hire can achieve greater coverage and reach a larger proportion of its customer base of existing Travis Perkins clients.

Hire is currently offered at 319 Travis Perkins branches, including 131 ‘satellites’.

Richard Dey, who joined Travis Perkins in 2006 having previously worked for A-Plant, Jewson Tool Hire and Hire Centers, is enthusiastic about both the progress it has made in recent years and its future growth plans. “TP Hire had a cracking 2010. Turnover was up by 22% to £48.3m, as confirmed by your Tool Hire Top Ten report, and hire was one of the best performing product groups within Travis Perkins. Trading remained steady from February through to August, and it simply went through the roof from then on. In fact, on 9 December we had a record amount of equipment out on hire, and business to date in 2011 has been at a similarly high level. The recession certainly affected us, like everyone else, with turnover dropping by £5m in 2009. However, TP Hire seems to have been affected by it later than other group operations, and to have come out earlier.”

Richard Dey also has responsibility for 13 Keyline Hire branded outlets. 15

Richard Dey believes that the main reason behind TP Hire’s success is the recognition that “the merchant tool hire model is different from the traditional tool hire concept.You need to understand the specific needs of the merchant customer base, and respond accordingly. When I joined Travis Perkins, only around 10% of the group’s ‘live’ account customers hired from TP Hire; that has now risen to 17%, still leaving a huge potential base to target. They are already visiting their local merchant outlet for materials, and we simply have to persuade more of them to use TP Hire for tools and equipment. We already have the essential infrastructure of buildings and operational systems in place, so the additional costs of offering hire are minimised.

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