CROSSHIRE DON’T SCRAP IT, SWEAT IT


From time to time there have been rumblings, usually attributed to the evil empire in Brussels, along the lines that all sorts of industrial equipment, including much that hirers offer, should have a definitive life dictated by law. This sort of nonsense would no doubt require a new and large statutory body to act as referee, thus giving an employment lifeline to many of the overpaid civil servants that are about to be given the boot from their current gold plated jobs.


I visit a fair number of hire premises over the year and, generally, the piles of rusting and cannibalised scrap that used to be the norm in some quarters has largely disappeared. Cynics might say that the price of metal has had a part in this, but I believe that most of our industry is operating well-maintained kit, although the average age of many inventories is increasing. Any emergence of a statutory ‘life’ for our kit would have far reaching implications for our suppliers and us.


keen to sell new machinery, are now worried at the volume and quality of trade-in items.


Some of you have embarked on refurbishment programmes which can be capitalised and add renewed value to the fleet. Others argue that the sort of expenditure needed to truly re-build kit is not economical. One point that is often missed is the fact that most of us charge exactly the same rate for our older kit as we do for new items of greatly improved specification. This is surely a mistake. If a punter demands low price as his greatest priority, why should he get the very latest kit? In the car hire market, well-maintained older models can be hired for less than their new counterparts.


Some larger hire companies have been selling off old equipment at auction.


If pressure is placed on us to accept a definitive life for kit it will be essential to sweat our older assets in their final years. This could see two distinct hire price structures developing


In an ideal world, if we could all get a decent return over the expected life of an item and then scrap it, we might be better off. There would be no old kit being sold to users or ‘amateur’ hire outfits to come back and bite us, and no need for our suppliers to haggle with us over trade-in allowances, thereby giving us the best price for new kit. Of course, we may not want to hang on to a machine for its whole useful life. A legitimate market in second hand equipment will always have its place.


However, the population of old and nearly life-expired machinery is going to increase without any statutory help. That nice Mr Cameron is not going to help us by introducing an equipment scrappage scheme, so what will happen to our old kit as we start to re-equip with those shiny new low- emission items many clients are demanding? Some of the large hire outfits have sold off old kit at auction, which is good for them, but not necessarily good for the greater industry - unless, of course, it is going abroad. Many suppliers, although


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and that is possibly long overdue. It is unrealistic for the safety and quality lobby to demand that our industry jump through all sorts of hoops regarding specification while our customers demand low rates and free transport. Greater vigilance by clients has seen average hire periods drop and the days of a tool being ‘lost’ for weeks in a shed on site, whilst clocking up hire charges, are now rare.


Many of us can, and do, provide customers with regular schedules of what they have on hire, and this information possibly contributes to lower utilisation. I had a punter in recently who was investing thousands of pounds in a swimming pool. He objected to paying our rates for a small digger and suggested that our industry was a rip off, charging far too much. Having worn out his welcome at other local hire outlets, he demanded we supply the cheapest method of digging his pool. I offered to sell him a spade! An extreme example of course but we really do need to redress the balance. Enhanced rates for new and more environmentally friendly kit are not an unrealistic goal. Older, well-maintained assets can also have a place, and giving the customer a choice may generate new opportunities.


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