TruckRental

Liam Hickey (left) and son Donovan saw a gap in the market and felt they could separate themselves from the pack by using their wealth of transport experience and expertise to offer a range of value-added services.

As anyone in the trucking business will attest to, the acceptance of risk as a very real part of daily operations is part of the job package. However, starting a transport business with not one customer in sight and a required investment of between R7- to R8-million takes the notion of risk way beyond its normally acceptable boundaries. Yet that's exactly what trucking entrepreneurs Liam Hickey and his son Donovan did when they founded Payload Truck Hire, a Gauteng-based truck rental company, in May 2006. Patrick O'Leary visited the company to check whether the risk they took is paying off.

Walk into the luxurious ZoZo hut offices of Payload Truck Hire situated on a spacious piece of land dwarfed by the towering Afgri grain silos just beyond Kempton Park and you'll notice a poster on the wall that tells a lot about this company. The poster displays three photographs of a line-up of trucks above which are two words written in big, bold, black letters. "Never Again!'

"Those pictures were taken during the first couple of weeks of us opening the business," says Donovan. "We'd invested heavily in fleeting up with new trucks and they sat for weeks lined up against the fence making us look like a truck dealership. We swore then that it would never happen again - and it hasn't."
 

The poster that says it all... NEVER AGAIN... will a fleet of trucks sit idle in the yard of family business, Payloads

Today, those trucks are all out on the road working for their living serving the needs of a variety of clients. Although those first few weeks were anxious times for this father and son team, it strengthened rather than weakened their resolve to build up a successful business.

Many readers will know the name Liam Hickey for he is no stranger to this industry having been involved in trucking since 1971 when he first joined a bus company in Cape Town as a traffic assistant. In 1976, he left to join one of the major oil companies where he remained for 19 years occupying various positions in the fleet side of the business before heading off on his own to enter the car carrier and transportation of mini-container business.

For the next nine years, he operated a contract to move cars for the country's major car manufacturers supplying the trucks, trailers and the drivers. His efforts during this time in uplifting standards and staying abreast of international equipment trends paid off handsomely for this sector of the industry.

He then moved on to do some sterling work in training and managing owner drivers through his company called Driver Entrepreneurs. These drivers hauled under contract to PX Containers and Autonet and it was here that he gained valuable experience in getting to know and work with South African truck drivers. It was also here, 10 years ago, that his son Donovan got involved in the transport industry joining his dad in the company.
 

	Selecting the right vehicle to do the job is the key to successful cost effective transport operations

Identifying the gap
But it wasn't enough. Liam wanted to start something with his son and after looking around for a gap in the industry, he and Donovan identified the truck rental sector as one where they would be able to add value. They also saw it as a growth sector.

"We knew that if we could enter this sector offering excellent service to customers as a reliable and honourable service provider with reasonable but certainly not the cheapest rates, we would be able to make something of it. Sure there are lots of players in this sector but we knew that if we could separate ourselves from the rest by using our transport experience and expertise to offer a range of value added services, it would work," says Liam.

And work it has with the initial fleet having been expanded in only one year from a handful of Hyundai bakkies to a total of 32 vehicles ranging from bakkies - both open and van bodied - through to 8-ton rigid dropsides, curtainsiders and closed vans right up to a Mercedes-Benz truck tractor and two tri-axle curtainsider semi-trailers.

The customer base has also expanded to the point where the first few ad hoc customers who tried out the service offerings are now regular clients who not only keep coming back but also pass on the Payload Truck Hire name to others as a good company to do business with. That line-up of trucks that stood forlornly in the first few weeks looking through the fence for customers, is now an active force to be reckoned with.

But there's still a long way to go - especially given the fact that the Hickeys aim to build their business to the point where they'll be running a fleet of between 400 to 500 trucks of different shapes and sizes operating out of branches spread across the national grid.

"Part of our plan is to now go out and get more FMC business entering into long term contracts with selected clients. Our advantage here is that we know the trucking business and can offer clients a total transport solution which will enable them to focus more on their core businesses. We're not just daily rental clerks. We know the business of transport and know that there's more to trucking than just the truck," says Liam.

On this point, Liam says they are prepared to fleet up to cater for specific client needs should a contract arise. "We will spec and bring into our fleet vehicles that suit a contract client's business needs. It won't be a case of using whatever vehicles we have in our yard. Selecting the right vehicle to do the job is the key to successful, cost effective transport operations. We're prepared to go the whole way for our contract clients."

Of course, everybody claims to offer superior service, so what are they doing differently to set them apart?

"We're obviously not going to give away all our secrets but we do apply many of the experiences learnt from running professional transport operations. We have been on the operational side so we understand transport well. Things like no downtime, reliability of product and excellent back-up services are part of our deal. Providing trained and skilled drivers with good people skills is also part of it. Also, because of our knowledge in speccing vehicles for the job, what you pay for is what you get. When you pay for an 8 ton payload, you get 8 tons, not 7,5 tons, " says Donovan.

Standardising on FAW
Vehicle selection is paramount in any operation and truck rental is no different. On this score, Liam says they have decided to standardise on FAW for their medium range truck fleet. "FAW is a perfect product for truck rental as the trucks incorporate the well tried and proven Deutz engine as well as a basic engine. If there is a major breakdown, FAW can replace the engine on the side of the road thus getting the client up and running in the shortest space of time."

With so many players operating in this arena, price is an obvious factor to take into consideration in being competitive. However, the Hickeys do not believe in doing business at any price.

"We are not the most expensive but are also certainly not the cheapest. We know from what we have seen over the years that the lowest price does not allow for a sustainable and well-run business. Sure you can buy cheap transport but you're then your clients are going to get what they pay for. We are not in this business to make a quick buck over the short term. Our intention is to build a business which is sustainable and profitable offering customers a reliable and quality service at a reasonable rate."

With it being common knowledge that truck rental companies undercut each other on price, I asked Liam whether he saw the necessity for a national truck rental body which would be able to regulate prices to certain levels so as to maintain quality levels in the industry without imposing on the competitive nature of the industry.

"No. I recall years ago when a number of companies agreed on certain rates but it wasn't long before they all went their own way screwing each other once again. It won't work. No-one even speaks to each other. Some don't even like each other so how do you get agreement in such an environment? The market will be the final arbitrator but we have no intention at all of dropping our rates down to the rats and mice level. It is impossible to operate a quality transport service at cut-throat rates," he retorts.

‘Our clients will get the best drivers possible... they are key representatives and assist in keeping operational costs down.’

Professional drivers
While on the point of quality, another plus for clients which arises from the Hickeys past experience is the fact that the drivers they get behind the wheels of the trucks they hire out are well trained professionals with both operational and people skills.

"We've worked with so many drivers over the years that we know all the attributes that make up a professional driver. We also know all the procedures for hiring skilled drivers such as validating the legality of the license, checking references and backgrounds and checking for any criminal records. We won't cut any corners in ensuring our clients get the best drivers possible. A good driver is not only a good representative for the company but is also one of the key players in keeping operational costs down.

He admits, however, that finding quality drivers is going to get harder and harder given the shortage of drivers and the lack of newcomers entering the industry.

"AIDS has had a huge impact on the truck driver fraternity with thousands of drivers having died from the disease over the past ten years. The industry itself has failed in attract new entrants to fill the gaps and those who are coming in are inexperienced and untrained. Finding solutions to this is one of the biggest challenges facing the industry."

However, he also sees challenges such as this as being the driving force behind more and more companies contracting out their transport needs in the future to companies like Payload Truck Hire. "They will not want to be burdened with all the headaches of running a transport fleet and that is where I see a big opportunity for growth in the contract hire side of our business."

The Hickeys are talking all the right stuff. The risk is paying off and FleetWatch's prediction is that this company is going to go places. Why do I say this? Simply because in today's high pressure environment where reliability is paramount in meeting the new demands that have been placed on trucking, the transport side of any business has to be run by experienced professionals. Gone are the days when transport was regarded as the Cinderella of a business. Costs alone have driven that attitude out of the equation. As Liam says: "There's more to trucking than just the truck." After 36 years in the business, he should know.