The impact of the Stimulus packages announced earlier this year should now begin to benefit the Hire and Rental industry.
Many projects announced in the Stimulus packages had lead times for tendering, design and planning stages, especially the larger projects.
The Hire and Rental industry is critical to the efficient delivery of these projects, as explained in previous post.
In essence the industry is critical because it can efficiently deliver equipment, resources and solutions to the companies delivering the projects with out the need for such delivery companies to use critical cash reserves to purchase equipment.
Stimulus Packages Size and Investment
During the earlier part of 2009, Governments in the USA, UK, Australia, New Zealand and Canada announced significant local stimulus packages. A major portion of this investment has been directed towards Infra-Structure projects designed to kick start the construction sector.
The numbers are staggering!!!
Specific details on the USA package
Whilst some major projects in each country will have lag times as the tendering, design and planning stages are processed. However many of the government initiatives have been directed towards accelerating numerous small projects.
These projects will be small, numerous and dispersed creating a demand on tools and equipment. Construction, Tool, Scaffolding and Temporary Fencing Rental and Hire companies may well be able to benefit from this demand. In order to meet the requirements of numerous competing projects, many construction companies may not be able to efficiently allocate and re-locate in-house tools and equipment.
Hence increasing demand for more construction hire equipment.
A second related issue is that in some countries, banks are forcing property developers to expedite projects or lose their line of credit. This has had a flow on effect to Town Planning departments, where many are under heavy workloads to meet expedite approvals.
Small Projects Flow On
Some Western Governments have handed our tax incentives or cash hand outs to stimulate demand. This could contribute to a growth in the home repair and maintenance market. Three factors may potentially contribute to the growth in this segment:
- Reduced equity in the home due to the fall in house prices will mitigate against many people borrowing against their house value to undertake major projects.
- Increased disposable cash from tax cuts and interest rate cuts may assist in home owners undertaking minor projects and repairs.
- The prospect of a greater focus on activities with friends and families, which includes home repair activities, again discussed in the previous post.
If you are considering improving your marketing to these segments Construction, Tool and Temporary Fencing then using HireEzy’s ( hire software, hire management software) inbuilt marketing tools will aid you substantially. For more information go to www.makinglifeezy.com.au
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