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There are various
interpretations of the definition of the UK Tool Hire Market. At the
outset, it should be emphasised that this report on the Tool Hire
Specialists Market focuses on companies who offer a wide range of
products and where tool hire is a significant proportion of
business activity.
The UK Tool Hire
market has experienced a period of low level growth where the principal
drivers include niche sector construction growth, health and safety and
environmental legislation, repair maintenance and improvement, and a
stable UK economy. It is forecast that these factors will continue to
contribute to positive market growth in the short, medium and long term
with the impact also of product innovation and the development of new
market sectors.
The total market
in 2005 is estimated to be worth around £830 million at hire prices,
which represents positive growth compared to 2004.
Whilst 1998-2000
witnessed steady growth primarily driven by millennium and government
health and education funding, 2001-2002 were also relatively stable in
overall terms despite the adverse impact of the global recession/decline
in IT and telecoms. The years 2002-4 witnessed continuing growth driven
by positive conditions in many end-use sectors, for example continuing
high levels of government expenditure in health, education, and the
promotion of affordable housing, key workers accommodation, defence,
etc.
More recently,
during 2004/2006, activity levels in commercial construction have
remained relatively stable but in overall terms the construction market
has been stimulated by substantial increases in health, education,
defence and infrastructure funding, also an increasing awareness of the
need to alleviate the housing shortage. However, the retail/home
improvement/DIY sector is in relatively poor shape, reflecting a decline
in the housing market and consumer confidence. The manufacturing sector
has also experienced relatively lacklustre conditions but there are
signs of a modest improvement in prospect.
In terms of industry structure, the market leaders are
Speedy, HSS, A-Plant, Hewden, and
Brandon,
recently acquired by Wolseley in early 2006. These companies have
expanded their networks, rapidly through acquisition, organic growth, or
a combination of both. GAP Group and Wolseley (Hire Centres),
Jewsons, Travis Perkins, and VP Plc also have substantial
networks, with Wolseley ranking higher in 2006 following the acquisition
of Brandon and over 140 branches. In addition, Speedy have
doubled their generator fleet following the recent acquisition of LCH
generators, including six hire depot.
The tool hire industry is estimated to comprise around
2500 outlets in the UK, based on our definition, including specialists,
merchants and independent branches . Openings of new branches have
occurred, in addition to significant growth of major multiple outlets –
for example, Speedy and
Brandon.
In addition, HSS have expanded their UK agency programme with
development of decorator centres and plumbers merchants, etc.
Multiple branch companies (with 4 or more outlets)
account for around 76% of the market, builders merchants 13% and small
hire companies 11%. It should be emphasised that these figures refer to
2005 as, in 2006, the builders and plumbers merchants tool hire share is
set to increase substantially, reflecting Wolseley’s acquisition of
Brandon. Further growth and share capture is forecast in the builders
merchants sector, given the substantial resources of the major builders
merchants and their increasing interest in developing tool hire as a
long-term growth sector.
The range of products offered by tool hire companies is
continually expanding, reflecting technical innovation stimulated by
health and safety, and the need to increase productivity levels. In
addition, the development of traditional plant hire sectors by tool hire
companies provides a logical framework for building turnover by
expanding product ranges and broadening the customer base, eg:
instrument hire with the market for infrared imaging products witnessing
a period of unprecedented growth.
Within the tool hire market, access equipment is
estimated to be the largest product sector typically accounting for
around 13% of turnover. Drilling & breaking, plumbing & pumping, and
lighting, welding & power, gardening and landscaping are also major
product groups, each accounting for around 9% of hire turnover, with the
largest grouping, miscellaneous products, including compact plant,
lifting gear and materials handling, consumables and surveying equipment
etc.
The range of tool hire customers is broad-ranging and
includes, for example, infrastructure contractors, builders,
horticultural contractors, maintenance engineers, DIY home improvers,
local government, etc. In addition, there is a continuing trend towards
‘preferred supplier’ agreements operating on a national scale.
The continuing trend to outsourcing non-core company
activities continues to benefit the tool hire market, with prime areas
including 'infrastructure contracting' and asset management activities,
for example building maintenance.
Increasingly
demanding Health and Safety standards, environmental emissions and
acoustic regulations represent key drivers for tool hire and tend to add
value to the tool hire market in overall terms. These trends are
reflected in the growth of several niche sectors, such as access,
lifting, power generation, instruments, which are likely to underpin
market growth in the medium to long term.
Growth rates for
tool hire companies tend to vary regionally, reflecting levels of
regional investment and regeneration programmes, population density,
also patterns of local industry specialisation and renewable energy
factors – such as the location of wind farms, etc. Within our
definition, annual growth rates of around 6-10% are forecast for the
period 2006-2010, with the market forecast to cross the £1 billion
threshold in 2008-2009.
List of Companies Mentioned
HSS, Speedy Hire plc, A-Plant, Hewden Stuart, Jewson, VP
plc, Brandon Hire plc, Cox, Andrew Sykes, Travis Perkins, Cox Hire, Gap Group Ltd, Wolseley Hire Centres, Finning
International Inc, Lord Hire Centes, Branson Tool Hire, Coastal Tool Hire,
Parker Plant and Tool Hire, MF Hire, GEM Tol Hire, JP Hire Centres, Beaver
Tool Hire, Ermin Plant Hire, Hartley Hire, Bradford's Building Supplies,
Jacksons, Meyer International, Focus Group, Upright Genie, JLG, Manitou,
Skyjack, Pinguely, Haulotte, Titan, Clow, Youngman, Upright UK, Euro
Towers, Turner Access, Titan, Ally Tower Services, Giraffe Access Towers,
Ability International, Interlink Alloy Systems, Aliscaff, RMD Kwikform,
Mitie Generation, Zarges and Layher, Bosch, Dewalt, Makita, Universal
Drilling, Rotabroach, Alta, Hilti, Atlas Copco, Ingersoll-Rand, Hilti,
Stuart Turner, ITT, Hilta, Ingersoll Dresser, T-T Pumps, Godwin Pumps,
Arctic Products, Rothenberger UK, Freeze Master, REMS, IBP, Dolmar,
Shindaiwa, Norton Construction Products, DeWalt, Elecktra Beckum,
Hitatchi, Ryobi, Fein, Plasplugs, Kwik Split, Matholite, Marcrist, Genset, Generac, HPL, Youngman, SGB Group plc, David Barto International,
KES Power and Light, Firelight Systems, Briggs and Stratton, Lister,
Petter, Caterpillar, Cummins, F.W. Wilson, Brook Thompson, Arc
Gen, Harrington Generators, Power Equipment, Brook Thompson, Mosa,
Stephill Generators, Ebac, Andrews Sykes, Broughton, Air Trembath,
Dantherm, Broughton, De Longhi, Carrier, Heatbusters, Acna, Group
Engineering, Rapid, Aggreko, Flymo, Bosch, Honda, Black & Decker,
Tracmaster, Husqvarna/Partner, Jonsered, Stihl, Allen Power Equipment,
Metabo, Hiretech, Alto, Remington, Hilti, Kranzle, Karcher, Bredon, Checo, Dema International, Kew Cleaning Systems,
Climex, Numatic International, Marcrist, Belle Engineering, Benford,
Wacker (GB) Ltd, Svedela (UK), Ammann Equipment, Errut
International, Bomage, Norton, SPE, LGH, Tirfor, Genie
Rako Products, Mace Industries, CNH, JCB, Caterpillar, Volvo, Takeuchi,
Empteezee, Serco Group, Haden Building Services, Building and Property
Group, Jarvis, Amey, GT Railway Maintenance, Balfour Beatty.
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