James Hargrave, head of supply chain at Nexus Vehicle Rental, discusses the benefits of using rental vehicles to mitigate challenges in the construction sector.
The UK construction industry has thrived over the last year, with early predictions that it would expand by 3.4% in real terms in 2022. Yet despite this relative buoyancy, higher interest rates, rising construction material prices, labour shortages, and supply chain disruptions will undoubtedly make for a bumpy ride as we look ahead.
Plant vehicles such as loaders, excavators, trucks, and diggers are integral to construction activities, but purchasing and maintaining these specialist vehicles represents a large chunk of operating costs. Flexible rental is now a viable option to help construction businesses source suitable vehicles, keeping overheads low and delivering projects on time.
Keeping costs down
Construction companies tend to work on a project basis and often need to transport equipment and people to multiple sites. This can take time and use up substantial resources, which can be costly and slow down work. Using older, less reliable vehicles can also increase the risk of breakdowns. The challenge for construction companies is to ensure vehicles are reliable enough to ensure smooth project delivery while keeping costs in check.
Renting specialist construction and plant vehicles can provide companies with the necessary vehicles at short notice. Apart from solving the issue of multi-site operations and a distributed workforce, these vehicles are newer and better maintained.
Rental suppliers have stringent service level agreements (SLAs) that guarantee legal compliance and a consistently high vehicle standard, making rental a much more attractive option to maintain your bottom line. The rental supplier also bears the asset management and equipment maintenance costs, further reducing a construction company’s operational expenditure. Moreover, rental means that the business doesn’t lose money on depreciating assets, and the option to swap for a newer model or an alternative vehicle becomes a lot easier.
On time, every time
With tight schedules, a strong supply chain is critical to avoid expensive downtime for businesses working within the construction industry.
Nexus, for example, provides its business customers with immediate access to more than 150,000 specialist and commercial vehicles and HGVs across 2,000 locations. With this unrivalled supplier network, specialist plant vehicles are available whenever and wherever clients need them to ensure projects run smoothly. The ease of a consolidated supply chain from a singular access point cannot be understated.
Maintenance downtime is often difficult to anticipate and can hurt productivity, leading to significant additional costs. Therefore, having the proper distribution channels are essential, and businesses should utilise smart rental management platforms to remain agile in the rental process, as such platforms can allow users to rent additional vehicles, even once a project has commenced.
Improved efficiency
Whether construction companies need to move workers between sites or transport heavy machinery, equipment or materials, a flexible rental solution enables them to upscale or downscale their fleets depending on demand. For instance, providers offering longer-term rental for more than 28 days without a lengthy lease contract is an invaluable benefit.
Fleet managers can flex their fleets when they require additional support, achieving cost-efficiency by only paying for the extra vehicles when needed. With a rental, it’s also possible to return vehicles before the agreed date at any given time and without additional costs. Even if a project gets cancelled at the last minute, it is possible to cancel the booking or off-hire vehicles to minimise costs. Another benefit of a rental solution is that it enables businesses to try new technology and specialist equipment – such as specific plant equipment or electric vehicles – without significant upfront investment.
We’ve seen that uncertain economic conditions in the construction industry are progressively driving a strong rental market to keep project costs down and increase firms’ flexibility to improve efficiency.
Partnering with tech
The digital revolution has left an indelible mark on the vehicle rental industry, with providers able to offer much more than just vehicles. Nowadays, the best providers can handle all compliance – a particularly time-consuming task in the construction sector. Through detailed Management Information (MI), they can also highlight cost-inefficiencies to help manage projects efficiently.
A market-leading MI suite can provide real-time data on all areas of rental, from live reservations to damage claims – instantly identifying the most cost-effective options for customers while highlighting inefficiencies in the rental booking process.
With this comprehensive range of services encompassing administration, maintenance and accident management, rental is there to offer a helping hand and to reduce paperwork overload.
As the industry advances, construction fleet managers must think creatively and take advantage of the innovative, unique solutions available to them, especially when operating against a backdrop of labour shortages and high demand.