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Speedy CEO: Running out of stock is 'unforgivable'

Speedy Hire’s chief executive Mark Rogerson has said it is “unforgivable” that the company has run out of equipment in the past.

Mr Rogerson told Construction News the hire firm must continue to improve its understanding of customer demand by putting “equipment in the right place at the right time”.

He added: “It’s unforgivable that we have been running out of these products and we need to try and curb this.”

A recent analysis revealed that half of the company’s revenue across London (£25m) came from just 60 out of 400 products. Mr Rogerson admitted Speedy had struggled in the past to maximise its efficiencies, holding “too much of the wrong equipment and not enough of the right”.

Former chief executive Steve Corcoran resigned in 2013 following a “mis-statement of accounting balances” in Speedy’s international division, which led to a £5m hole in its accounts.

Since then, the company has withdrawn from the general hire business in the Middle East, closing offices in Egypt and Qatar and selling its business in Oman.

“[The Middle East] is now a much cleaner business,” Mr Rogerson said. “Not massively profitable but not loss-making.”

Mr Rogerson has also led a “radical shift” in the way the company operates, including a commitment to delivering products quicker across the UK.

It launched a new 162,000 sq ft national distribution centre in Tamworth last month, which houses all 4,000 product lines.

The centre has replaced a series of 240 smaller stores and depots.

“We’ve seen that these stores don’t have to hold anywhere close to as much stock as they were.

“So we can be a lot more scientific in the way we base our asset holdings across our networks.”

“There is a need for us to get better at understanding our customer demand and forecasting because if we do, we have all the capex and ability to fulfil those [needs for our] customers,” Mr Rogerson said.

He said the company had a large number of “slow-moving assets” – equipment that is usually ordered well in advance by contractors – and questioned why the firm needed 150 to 200 depots to hold the equipment.

Speedy’s full-year trading update for the year ended 31 March 2015 was published this month.

In a statement to the City, the board said it expected to see adjusted profit before tax “slightly ahead of market expectations.

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