Hire ground

A 250mph Bugatti convertible versus a two-and-a-half tonne counterbalance forklift truck. Some things you dream of owning. Others, even those replete with fingertip hydraulic controls, you'd be quite happy to hand back at the end of their useful service. "Forklift trucks are not a particularly emotive product," says Andrew Woodward, vice-chair of the Forklift Truck Association (FLTA). "Not in the same way as cars. Forklift trucks are workhorses. I don't think many people say: 'I really want to own it'." And detachment has its advantages. Out go the irrational 'got to have it' buys that send an FD reaching for an industrial-strength camomile tea. In comes stability and security as worn tyres and flat batteries are placed in the hands of a third-party for an affordable monthly fee. An estimated seven in 10 sites are sleeping more easily having switched to renting trucks. Woodward explains: "Finance directors love it because they can budget ahead five years and know exactly how much it's going to cost them. Renting trucks can also be tax efficient and moves your forklifts from a capital cost to an operating expense." Three cheers for rental then. Perhaps, but amid the reverie, don't forget your financial common sense, advise truck experts. Finding the right hire deal should be treated with the same diligence as the days of yore when, as a buyer, you'd trawl the forecourts to kick cushioned pneumatic tyres. Short or long: selecting the optimum contract hire length First stop to finding the ultimate hire package, say industry insiders, is establishing the right length of rental. Shorter term contracts will give increased flexibility, but in reality will often be more expensive due to the depreciation in the asset value being spread over a shorter period.   Longer hire contracts on trucks (beyond five years) are available and offer the lure of cheaper monthly repayments. However, this is offset by the longer-term commitment and you'll also be left with an older truck on site at the end of the agreement. The key is deciding whether a longer contract and lower monthly payments are compatible with the wear and tear you're placing on the truck. Signing a 10-year contract to save a few quid is pointless if you have run your truck ragged and need a new one after five. At the other end of the spectrum is the short-term rental market. This caters for the commitment-phobic who are brought out in a cold sweat by hire deals measured in months and years. Deals can be as short as a week with sites paying a premium for flexibility. Invite the dealer to visit your site Inviting a dealer to carry out a full site inspection is fundamental to selecting the right forklift. "Give the supplier full access to your site," advises Woodward. "Make sure you show them any doors or openings the truck has to go through. I have heard horror stories in the past where customers didn't give all the necessary information and the supplied forklift couldn't get through the main door into the factory because the mast was too high." Determining accurate hours use Once again honesty is the best policy here. The dealer will use the hours-in-use metric of your hire contract to establish the level of servicing and maintenance required on the truck, explains Dave Clarkson, sales operations manager North East and Scotland for Toyota Material Handling. The more time the truck is in use, the higher the servicing demands and the higher the rental cost. Those who uncover a hidden talent for time travel are soon brought back to reality at their first truck service, says Clarkson. "If we service a truck six months in where a customer has told us it will only do 250 hours per year and it's actually done a thousand, then we can put that information into a document and get our sales team to review that with the customer." Persistent time-bandits not only waste time, they also risk lives, warns Clarkson. "From a legal point, if the truck should be serviced every 500 hours and the customer pulls the wool over our eyes to keep the cost down then, if the truck had an accident, that would lead that company open to HSE investigation." Trade up on the maintenance package Scrimping on maintenance could unleash the kind of erratic costs that you switched to a forklift rental to avoid. "Check the exclusions," advises Woodward of the FLTA. "Forks, tyres and chains are often excluded so make sure you understand what is included in your package and that it covers what you are expecting. When making a final decision ensure that you are comparing deals on a like-for-like basis. Some quotations will include a full maintenance package and others will be for a more trimmed back predictive maintenance service package." Breakdown cover should be heavily underlined on your checklist. Investigate the maximum response time for a supplier to send out a service engineer. And check there isn't a hidden fee for bringing Mr or Mrs Fix-it out of bed at 3am. Finally, consider the case for a replacement forklift in the package. It could pay dividends if your production line is going to be stricken while you wait for a truck to be repaired. Avoid the blind spot Forklift drivers are warned to look out for blind spots as they zip around the factory. But management don't seem to heed their own advice when it comes to contract hire negotiations. "Sometimes people find it very difficult to avoid buying on price," says Geoff Martin, chairman of the FLTA. "Every dealer will know of a case where they've lost a deal on price and the customer hasn't got the truck they needed" Remember, price-tag myopia means long-term misery concludes Clarkson of Toyota Material Handling. He says:"There's no point getting a rental at £50 a week if that means that organisation hasn't got enough money in the deal to service that truck over the five-year period and starts cutting back on servicing so the truck is in a terrible state... Savvy customers understand every minute the truck is not working it is costing them a lot more in downtime." Five-steps to hire heaven 1 Pay extra to cover for the extras: stretch the budget to secure premium maintenance and servicing cover. Scaling up to the best package will keep your forklift working at optimal efficiency and ensure you aren't hit with an extensive repair bill when you least expect it. 2 Check out the dealer: The lean manufacturing problem-solving principle of gemba (go-see) is just as effective in selecting your optimum truck fleet. "Customers should go and visit their supplier to get a feel," says Martin of the FLTA. "You can quickly see if someone says 'I've got loads of engineers to come and visit your premises' and they've got a 1,000 sq ft unit then you know they've been misleading you. Go and make sure they've got trucks in their backyard; have a chat with their operations people." 3 Damage limitation: don't be afraid to discuss the potential penalties around accidental damages. Both parties should be clear about what constitutes fair wear and tear over a five year deal or beyond. You can check industry guidance out at www.fork-truck.org.uk 4 Driver training: keep your trucks shiny and new by ensuring operators are trained to drive them most effectively. Driver training packages can cost from £150 a day and are particularly important if you're switching to a different truck manufacturer or upgrading a vintage fleet. 5 Don't overlook second hand hire:?It's commonplace to see second hand trucks on a rental agreement. Some manufacturers will choose to finance a truck for a second or third cycle after the intial five-year agreement expires. Doing so brings the cost down while retaining reliability, if the truck is comprehensively maintaned. However, you won't have the luxury of a full warranty if something serious goes wrong.