Brandon eyes major expansion

Brandon Tool Hire has established a national network of 143 branches in little over 10 years and now has plans to lift that figure to between 250 and 300 in the next four years.

“When you consider that just 12 years ago we had no more than eight branches, you can see where future expansion should take us,” said Charles Skinner, chief executive. “Already you can place an order anywhere in the UK. Brandon’s current branch network means that we are within 45 minutes of 98% of the population.

“The next stage is to grow; to replicate the density of branches we have established in the areas where Brandon is already mature.”

Turnover (12 months to 31 December 2005) was ahead at £57m (£49m). Pre-tax profit strengthened to £5m (£4.8m).

In 2005, Brandon opened six new branches and added 11 more as a result of numerous minor acquisitions.

More than 90% of Brandon’s business is trade hire and the list of contractors with which it has formal hire agreements extends to Rok, Dean & Dyball, Emcor and Connaught. A further deal, with Enterprise, is also under discussion.

Brandon Hire announced at the end of December that a management buy-out was in the air, led by Skinner and finance director Chris Sims.

It has been prompted by Brandon’s volatility of earnings. “If it costs me £5m a month to open the doors and we don’t achieve £5m-worth of turnover, then I make a loss, but if turnover hits £6m, then I’m a genius,” said Skinner.

“However, I just can’t predict how much business will come through the doors in a month and that leaves me with a lot of stress.

“I can’t offer the visibility of earnings that the City wants from a quoted company, so we’d be better raising the money we need [to expand] privately.

“A second reason is that the industry we operate in is consolidating, which is unsettling for our people. We want them to feel more secure.”