Why pay the penalty?
October 1st 2008

In an unsettled economy, can you really predict where your business will be in five years time? Briggs says penalty-free flexible truck hire is the solution. Brendan Coyne reports

Briggs' market research threw-up some interesting industry insights, but one of the key findings was that customers need more flexibility: a changing world makes an impossibility of forecasting where business will be in five years time. With contracts, literally, contracting – from the old standard of five years, to as short as a year, the ability to move with the times, and the money, is imperative. According to Briggs sales & marketing director, Tony Rooney, it's therefore a good time to launch Flexihire.

"The industry is becoming risk averse.

Customers want more flexibility – to be manage their assets and change equipment without paying the penalty.

Previously we always offered termination options but the terms were too inflexible. If the customer's operation changes, they can find themselves with a hefty bill – and it is tarneshing the industry." The company's answer is a hire contract with a minimum of one year that uses a sliding scale of payments. If at any point after the first year customers wish to cancel the contract, all that is needed is a month's notice and no penalty is incurred. Over five years, the payment structure is slightly front loaded: the customer pays a premium for flexibility, according to Rooney. But there are benefits to this approach.

"If we can sell the upfront increased payment to the customer, it makes his life easier the following year," says Rooney. "He will be under pressure to reduce costs. With Flexihire the payments will reduce year-onyear." At present, Flexihire will involve new, volume equipment. However, if the market is prepared to accept one or two year old equipment, Rooney says it could form part of the package. While specialised trucks aren't ruled out entirely, he says Briggs reserves the right of refusal.

Mediocrity for the masses Demand for flexibility aside, Briggs' research found a general malaise gripping the sector. Namely that every supplier is as bad as the next.

"Two thirds of customers said they weren't happy with their current supplier.

When we asked them why, many thought the industry is over promising and under delivering – that we're all as mediocre as each other," says Rooney. "And with no quality differentiation, price is the only factor." He hopes Flexihire, which costs the same as long-term hire over five years, will tempt those dissatisfied with current suppliers to switch to Briggs without worying about tying themselves in. And he says the firm is geared up for growth, despite global financial uncertainty.

"We want to be the UK's number one service provider, and over the last two years we have focussed internally to enable the quality of service that will differentiate us.

We have a new IT system, with 28 people solely dedicated to improving the back office, and the system is helping us to optimise maintenance shedules." To this end, Rooney says Briggs will work towards engineering response much lower than the industry average of four hours.

But doesn't he risk over-promising? "We have to come up with systems that ensure that, if we fail, we feel the pain. It's the only way to make a difference and we're working towards that goal."

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