Kennards Hire celebrates 10 years of operations in New Zealand. Photo / Supplied
Kennards Hire celebrates 10 years of operations in New Zealand. Photo / Supplied
Family-owned Kennards Hire continues expanding in New Zealand with a brace of new acquisitions, despite slight caution from management about the economic outlook.
The equipment hire business has been operating here since 2012 when it acquired McEntee Hire. It now has 28 branches and 200 employees across the country.
In June it purchased the business assets of Rangiora Hire for $1.35 million, followed by a $7m purchase of the business assets of Smiths Hire in September.
General manager Tom Kimber said more acquisition growth was still possible.
“Definitely we’re not finished yet. We’ve got plenty of plans for bigger bandwidth of product, different silos of specialist equipment that we can still bring into the company into the country, and make my job and the customer’s job easy when we do that.”
Asked about the economic climate given Kennards operates at the coalface of construction and home improvement, he said there were challenges ahead, but also opportunity.
“Every economy has a cyclical nature to it. And yes, things are sort of contracting and pressures are coming on the business. But we’re incredibly robust.”
Kennards Hire General Manager Tom Kimber. Photo / Supplied
He said the company managed through downturns before and came out well.
“Sometimes in a downturn, customers can be less likely to invest into capital and more likely to use shorter term capital use, and that’s where hire comes in. So, yes, it can be challenging, but it also can be an opportunity if you’re looking at it the right way.”
Latest accounts filed to the Companies Office show Kennards reported a net profit of $4.5 million for the year ended 30 June 2022, down on $5.6m in 2021.
Kimber said like most firms, Kennards Hire had to adapt to challenges thrown at it through Covid-19. The solution was to come up with new systems to keep up with demand while preventing the spread of the virus.
He said contactless delivery and pickup were strategies employed across the whole service industry, and Kennards had chosen to keep in their operations.
“We found they actually gain efficiencies and convenience for our customers.”
Kimber said growth throughout Aotearoa was fuelled by commitment to customers rather than a goal to grow in scale.
“We’ve never planned to be the biggest... our key focus is around quality, it’s around making sure that we’re convenient,” he said.
“It’s not a matter of just putting dots on the map, it’s a matter of being where we need to be and that’s dictated by customer demand and sustainable growth through our company.”
The company managed to bounce back from profit losses after frequent lockdowns, where it saw an uptick in DIY jobs.
“I think a lot of people were sitting around at home, sick of looking at that fence, or looking to put a new pool in, or maybe a patio, so we definitely saw an upswing there.
“I think also with the supply shortages, we’ve seen convenience really playing at the forefront of customers making those decisions to engage with service providers. If you’ve got the equipment in the right place, that’s paramount to them at the moment.”
Kimber believes a plateau is on the horizon following this bottleneck.
He said shortages in labour and materials were constraining some construction, but expects this will “self-regulate” the market. He said infrastructure projects will get done but just may take longer than anticipated.
“That just means [work] is probably going to get pushed down over a longer period of time... We can’t do it all at once, and nobody can.”
These conditions support Kennards’ expectations to remain a very profitable and very sustained business, Kimber said.
Kennards Hire operations in Queenstown. Photo / Supplied
“Through the lockdown periods, we lost top-line revenue which you can’t go and get back ... If you’re acquiring businesses and you’re growing, that will hit your profit line a little bit, but as I can say, we’re a very strong, sound, stable business.”
Looking to the future, Kimber said its the people who keep the business sustainable.
“We’ve got a fantastic culture, not only in New Zealand, but across Australia.”
He said Kennards not only wanted to lead the way in accessible and convenient hire services, but to set an example for environmental sustainability, bringing in the first hydrogen generators in Australasia.
“We are looking to the future, and carbon neutrality and sustainability. I think the hire industry has got a massive part to play in that and Kennards are wanting to be the forefront of that as well.”
