At SED last year Hewden proudly marked its 40th anniversary. Little did the people attending that event realise just how things would change in the subsequent 12 months. The world economic crisis, and the unprecedented decline in the construction market that followed in its wake, resulted in dramatic changes to the size and structure of Hewden.

Hewden Stuart was formed in 1968 as the result of a merger between Hewden (Plant Hire) and RG Stuart Plant in Scotland. Subsequently, the company grew rapidly through acquisitions (including such famous names as Hireplant, M&H Plant, Mobilift, Scottish Land, Southdown, Stanley Davies Cranes and Stewart Plant).

Finning International purchased Hewden in 2001 and the hire company became ever more closely linked to the Caterpillar dealer in respect of both its organisation and the machines in its fleet. Under Finning control Hewden sold its tower crane and hoist hire fleets, reduced the maximum size of its mobile cranes to 100 tonners and, in 2007, sold its tool hire business to Speedy Hire.

Plant hire focus

The tool hire sale was worth around £145 million (including property sales) and it allowed Hewden to update its plant fleet. The hire company was then focussed on plant hire with Caterpillar machines representing an increasingly large proportion of the fleet. In response to the rapidly declining market conditions in the latter half of last year, Hewden Executive Director Doug Sprout instigated sweeping management and structural changes. Finning's Used Equipment Manager Kevin Parkes was promoted to become General Manager, Operations for Hewden and, in November, a new regional management structure was announced.

The new structure saw the number of regions drop from five to three. Each region has its own Regional General Manager (RGM) supported by Regional Operations Managers. The move also saw the demise of the previous five stand alone product specific divisions (construction equipment, access, power generation, mobile cranes and accommodation) as each new region is now responsible for all items in its area.

The beginning of December brought the news that Hewden, like other major hire companies, was to shed staff and shut depots. The company, which had been operating with 1750 staff and 102 depots, announced the loss of 213 jobs and the closure or merger of 22 depots.

The 12 depots selected for outright closure were Barrow-in-Furness, Cambridge, Chester, Elgin, Heathrow, Isle of Wight, Jersey, Melksham, Redditch, Shrewsbury, Thatcham and Yeovil. The plan also involved ten branches being closed and their assets and business transferred to other facilities.

This latter move affected Motherwell, Mount Vernon and Newarthill (all transferred into Glasgow Queenslie), Bathgate (merged into Edinburgh), Rotherham (combining with Barnsley), Warrington Great Sankey (merging with Warrington Appleton Thorn), Abergele (moving to Bangor), Cardiff (merging with the Cardiff Docks depot), Olney (Bedford) and Truro (consolidating with Redruth).

To reduce its fleet, Hewden has used Thimbleby & Shorland to stage a series of auctions around the country. During his PHE interview last month, Kevin Parkes was upbeat about these events. He stated, "The Hewden auctions are always very well attended and highly popular, with machines commanding a good price - we believe a testament to the value that customers place on ex-Hewden stock, recognising that it has been well maintained during its hire lifecycle."

Ever since Finning International acquired Hewden, some people have questioned whether the hire business will change its name to the Cat Rental Store. On this issue, Kevin Parkes is quite emphatic, "No, the Hewden name is far too strong. A name change is not on the radar."

The organisational changes have been instigated to address the 'challenged' state of the market at present. Costs have been dramatically cut and Kevin Parkes contends that the new structure with its fewer depots, less managers and common hire desks is 'working well'.

A good example of the changes made at depot level can be seen at the company's Birmingham West depot - which, due to space constraints, is actually split between two nearby sites. Willenhall supplies cranes, powered access, power generation equipment and accommodation whilst Moxley provides plant. One manager covers both sites and all five product groupings whereas previously there were separate managers.

Single hire desk

The hire desk at Willenhall now handles calls for cranes, powered access and power generation equipment. Previously there were specialist hire desks for different equipment. The new customer interface is said to make better use of resources whilst offering more opportunity for selling packages of equipment. Calls are initially taken by the first available hire controller, but there are crane, access and power generation supervisors with specialist knowledge available who can take and progress the enquiry if required.

Transport is another area where efficiencies have been made. Each depot is a cost centre and its manager runs one transport operation serving all the different equipment under his control. Previously there were separate transport operations for each type of equipment.

Kevin Parkes contends that, with over 300 units, Hewden runs the biggest fleet of low loaders in the country. Better local control of these vehicles, aided by the work of the regional transport and logistics manager, means that different items (such as a dumper and an access platform) are now delivered to a site on one truck.

Hewden highlights its use of new generation 'Urban Lorries' with Euro 5 engines to give reduced emissions. Such vehicles, coupled with better transport scheduling, is helping the hire company to reduce its carbon footprint and satisfy customers keen to sell their own green credentials on to their clients.

On the subject of the new depot structure, Kevin Parkes says that greater emphasis is now being placed on the hub and spoke approach. The company has obviously maintained strategic locations in the major cities but it was considered that some depots could be closed without adversely affecting the ability to provide national coverage.

Kevin Parkes accepts that some custom has been lost in a few areas where locations have closed. But he says, "We are no longer in tool hire, people do not come in to see us any more so there were obvious decisions to be made." Now he contends that depots like Bangor and Wrexham have become much stronger. "Despite closing Abergele, we have retained a huge proportion of the work."

Financial decision

The closure of the large Heathrow depot in West London was viewed as more of a financial decision. "It was a big site and we could not see a way to make it work in the short term in the current financial climate." Heathrow customers will be served by the surrounding depots at Langley (powered access), Mitcham (powered access and plant) and Wokingham (plant).

The mobile cranes that ran out of Heathrow will now be controlled from Dartford but will continue to be parked in West London close to where their operators live. According to Kevin Parkes, Hewden is still 1 00% committed to provide mobile cranes for hire. Although the maximum capacity units in its fleet are 100 tonners, the company has preferred partners such as Mammoet to provide higher capacity units as and when required.

Cranes are important to jobs such as petrochemical plant shutdowns where Hewden has particular expertise. Kevin Parkes reports that Hewden has a 12 person Industrial Services team based at its Trafford Park headquarters. Their sole job is to work with the industrial sector which hires a lot of Hewden products. "Having people who understand a petrochemical plant shut down helps us gain more business through being able to provide added value."

Hewden prides itself on its environmental, health, safety and quality record. It has the appropriate accreditations across its entire depot network and these help it to win and retain national business with blue chip clients.

The company has invested £14 million in a new IT system called Movex designed to provide better customer and management information. To help its depot staff get the most out of the new system, Hewden is providing support and coaching through its Rental Operational Excellence team. Another initiative is The Flight Plan which will provide daily guidelines for staff to help them deliver to customers a consistent level of national service regardless of location.

Although the sale of the tools business restricts the total package that Hewden can supply in-house, it does work with Speedy on specific occasions. This cooperation is particularly evident on the Olympic site in east London site where Hewden is part of a consortium with Speedy, Lavendon and BSS to provide one of the two on-site hire services depots. Kevin Parkes feels that such a partnership can be replicated on other large projects in the future.

Another area where Hewden has a high profile is the supply of machines into the events sector. Its equipment can often be seen helping to erect stages and stands at major outdoor concerts and shows. A good example was at BBC Radio 1 's Big Weekend concert in Swindon earlier this year where 20 machines were on hire to the main event contractor, SJM Concerts.

Machines at the Swindon concert included JCB RTFLs and Groundhog all terrain vehicles together with Caterpillar telehandlers. Where Caterpillar makes a particular type of machine, this is now the preferred choice for the Hewden fleet.

First priority

Kevin Parkes accepts that some customers have a long seated brand preference or the desire to have a particular machine control layout. However, whilst indicating that he might consider other options to retain business, he concedes that the first priority is to convince customers to take new Caterpillar products.

He expects the Finning dealership to play its part to sell users, especially the national players, the material benefits of using Caterpillar machines. The new Visitor Centre at Caterpillar's Desford factory is expected to be an important asset in this process.

At present, Hewden runs Caterpillar excavators sized up to 21.0 tonnes, together with some 22.3 tonne payload 725 articulated dumptrucks and a few D5N and D6N dozers. However, there are no immediate plans to add bigger earth movers although the addition of Caterpillar waste handlers could be on the horizon as Kevin Parkes clearly views this as an area with much future potential.

Having slimmed down the overheads, the aim is clearly to get the business back into the black - a loss having been reported in Finning International's first quarter results. Last month Kevin Parkes stated that, "Our monthly results from the turn of the year have been improving month by month - both from a top and bottom line perspective." This is a difficult time for plant hire companies but, with the continued backing of Finning International, the restructured Hewden should now be better placed than some others to weather the storm.

Click here to download A Reshaped Hewden - PHE interview with Kevin Parkes, June 2009 (1.08Mb)