Equipment hire is a rapidly evolving, billion-dollar industry – and one the far-sighted pioneering equipment hirers of the 1950s would heartily applaud for its modern capabilities and innovative drive.
Today’s earth-moving machinery has made great strides in reducing site waste and increasing productivity. The range of products available for construction companies has widened extensively in recent years – and equipment manufacturers are also increasingly incorporating highly sophisticated new technologies into their kit.
When Brian Jones became president of the UK’s Construction Plant-hire Association last year, he noted that GPS, drones, 3D mapping and Building Information Modelling (BIM) will soon achieve mainstream deployment throughout the sector.
These advances are a response to fundamental changes the construction industry has undergone over the past 40 years. Contractors rely less on in-house skills and often choose to hire in the services of specialist sub-contractors on a project by project basis. This has allowed contractors to boost their balance sheets and become leaner operators in a highly competitive world, where margins rarely exceed 1-2%.
Equipment hire has grown as an industry off the back of this rationalisation, because it offers multiple benefits to contractors. Capital is not tied up for years and depreciation is no longer an issue. Hire fees are assigned to the operating expenditure (opex) column of each project. Hired equipment will tend to be new or recent generation, therefore more efficient and usually compliant with emissions regulations. Contractors can also select from a diverse range of machinery, tailored to suit specific job requirements, precisely as and when they need during a project. They can do all this with assurance that all hired equipment is regulatory compliant, meeting standards for health and safety, as well as technical criteria.
Of course, equipment hire is every bit as competitive a world as construction itself. It means contractors can factor low rental fees into their tendering, driving down the costs for clients and improving their own profitability.
Yet for all these upsides, equipment hire will only deliver benefits if the machinery is operating at peak performance. For this, a regular, smart maintenance regime is essential.
Machinery operatives say they place a high priority on looking after equipment properly, knowing it will maximise equipment lifespan, but maintenance teams are under pressure to cut costs and are often under-staffed. As a result, maintenance is being deprioritised.
A gap between intention and action is increasingly evident in the sector, and too often maintenance only receives proper attention after breakdowns have occurred. Given the consequences of poor maintenance – breakdowns and the wait for replacement kit; subsequent delays on site and possible liquidated damages if the project runs late – this is an approach with no long-term benefits. It means worse Total Cost of Ownership (TCO) for equipment hire companies, and project disruption for construction businesses.