[Ynot]

Biro, on 03 February 2012 - 11:37 PM, said:

Schools, Colleges and Amateur Theatres ? The 3 that notoriously never have any money..

I'd actually dispute that fact.
Sometimes trying to GET the money from them can take an age, but that's just red tape.
But I work with/supply several schools in the area, and whilst some have limited options, others do budget properly and have a decent hire policy. I'm doing a school one-nighter next month which on top of my fee will be hiring about a grand's worth of gear through me.

But that said, starting up a new company just doesn't strike me as wise - for many of the reasons already touted. And also because even the bigger hire outlets will often discount hires to educational establishments, meaning they can get top price gear for less than 'list'.

[Junior8]

In twenty odd years in educational environments I used hire companies four times, twice for follows once each for a ripple box and a mirror ball. In the case of the follows the cost of the hire and transport plus the time for someone to collect and return led me to buy two Sils for future use in this role. They are still there and still in annual use. If you are aiming at this niche you'll be serving a sector where by and large they'll all want stuff at the same time and, remember, with around 20 weeks a year (holidays/exam periods) when they wont want anything at all. Expect 60 days for payment.

This post has been edited by Junior8: 04 February 2012 - 06:48 AM

[kerry davies]

The only people I know who make a specific point of educational hire are a couple of companies whose main income is from installations in schools, colleges, community facilities and youth clubs. It is more of an add-on service to their existing customers and a few like me who have got to know them from the install side.

If you haven't got or cannot get approved or preferred contractor status from the Local Authorities it is difficult to enter the field. It actually might just be a good time to start a business, if this is the "bottom of the market", though I myself would avoid anything with a Local Authority customer base for three or four years, the cuts have only just begun. Don't get sucked in by a temporary bubble caused by Olympics and Diamond Jubilee, they will be over in a flash.

Just one more tip, have you noticed the slight upswing in kit for sale on BR? Could be because people are "downsizing" and being more careful in managing stock or because they no longer have economic use for it. Check out what the "competition" is doing, BR members who hire in to schools might give an optimistic picture.

[sleah]

Kind of hybrid answer - The drama teacher does the hiring, but if I was asked to do it, this is how I'd reply...

1. How many times a year do you hire equipment for your shows?
Once. Although we have 3 shows, the other two are lower key in terms of requirements.

2. Where do you hire the equipment from?
Not sure! Northern Stage comes to mind?

3. When hiring, what's more important to you apart from safety? (please put 'Y' next to ones that you'd select)
- Age of gear
- Top industry brands
- Appearance of gear
- Presentation of gear - Kind of. In so far as it actually works properly.
- Price - Y
- Speed of delivery - Y
- Technical support if needed - Y
- Hirer local to you - Y
- Any other?

4. Which kinds of equipment do you hire? (pars, movers, mics, decks etc)
Tech. wise, anything we need that isn't a generic or done with a gobo. That includes rain/fire effects, smoke machine, strobes.
Additional generics if we don't have enough.....

5. Would a service offering lighting / sound design for your shows be of interest to you?

Not at all in our case. Designers aren't really a big deal for school productions. Either entirely in-house by way of students or teachers/technicians or someone will know someone. I can't see 'hireing' a designer from a company where it isn't a friend of a friend.

Any other comments

To expand on question 3.
My comment about things actually working comes from hiring effects and having to repair the bl00dy things before we can use them, and then they were pretty dodgy.

It's also important the thing you hire does what you want it to do. Odd comment I know, but part of the service that would benifit both parties would be giving advice on what will achieve what's required, if indeed it is possible. There's possibly several ways round achieving an effect. A hirer who knows his kit inside out and has a good idea of how to achieve effects whilst keeping budget in mind, is going to get good credibility with the client and industry in general.

BTW I'm only talking lighting. We have all the sound kit in house.

Hope that helps a little

This post has been edited by sleah: 04 February 2012 - 06:44 PM

[CallumP93]

1. How many times a year do you hire equipment for your shows?
It deapends on what we are doing at the time, for example last year, we had a fault with our analogue lighting desk, hense needed a long time hire of a Demux, we had one on hire for at least 2 / 3 month. But its stock like this which is never really used, I work on a Scout / Guide Gangshow and between them and us, we are the only people that seem to hire it. Not really worthwhile. Due to the fact we were on analogue we never really hired alot, although in the past it has been once or twice a year,but we had a brand new refit over summer and are now completely digital, and hense are hiring more this year than we have in the past, but we are also doing We Will Rock You, so that was expected.
All in all I would say lighting hire once or twice a year from the school, but we do hire on some of the AmDram etc but not so often.
2. Where do you hire the equipment from?
In the past we have always hired from Pearce Hire and Hawthorns, but this year in the aim to get lower prices as we will be hiring a fair amount compared to normal, we have looked further a field and are this year hiring from Mansfield, but this is due to another member of staff knowing the person who runs the company well, which means we have been able to get a good deal for what we asked for. In addition to that one of the theaters I help at had a large stock of equipment and is seasonal, so we have been able to get a good deal from them aswell and some free hire from another show I work on, alone saving us £720. The prices we got are ones I dont think anyone would be able to beat, as we had saved over £2000 between both companies alone against Pearce hire, for the two weeks.
For the Gangshow I am involved in, we hire all our lighting gear from Pearce, but do well due to hiring from them for a large number of years. I really think if you do hire a lot you need good contacts as these seem to help you most defiantly get a better deal. In the past all of our sound gear has come from TEC (Nottingham Student Union), but this year we are hiring from a different company
3. When hiring, what's more important to you apart from safety? (please put 'Y' next to ones that you'd select)N - Age of gear - as long as the gear functions and does what we want we don't mindY - Top industry brands - although not always the better brands tend to have increased reliability, for example, I would not use one of these £300 movers from someone such as CPCY - Appearance of gear - especially if the kit can be seen by the public, it shouldn't look all tatty as what does that reflect on your show.Y - Presentation of gear - as above the gear should be presentable as it is part of the show and people do notice it.Y - Price - price is always a deciding factor in school, some years we have next to no budget, sometimes we do well. It normally depends on how well the last show went.N - Speed of delivery - as long as the kit is there for the day we hired it this does not bother usN - Technical support if needed - we know enough people in the local area who can help us if there is a problem, so this is not always a issue.N - Hirer local to you - if they will deliver and give us a good price we don't mind.Y - Any other - the service and how they treat you, some companies will not even deal with you as you do moot seem to hire enough or often, and when you do hire charge for everything, I guess everywhere does it, but when kit is fitted with 16A we need both 13A/15A - 16A, which very quickly can add up and add another £50 to a weeks hire, which can end up breaking the budget
4. Which kinds of equipment do you hire? (pars, movers, mics, decks etc)As before it depends on what we are doing, this year we are hiring:
profile moverswash moversPAR64s with Scrollers Headset radio mikes DI boxesHazerMirror BallsDMX cable, Power adaptors and Scroller cabling


5. Would a service offering lighting / sound design for your shows be of interest to you?
No, we have both students and staff here interested in light and sound, and hense they design the light and sound, which is then approved and used, as it helps towards there qualification.

Any other comments
I don't know if it is a worth while to start up in this sector, as most school have a preferred company to hire from, due to staff preference and what's been used in the past, schools don't like changing providers of equipment, due to contacts etc, e.g. Most schools get most of there supplies from espo
Thanks for this, this is one of the big questions I have. Is older gear ok to hire or does it need to be spanking new and latest model?
As long as its a reputable brand and not some of this cheap or Chinese knockoffs I wouldn't have a problem, just look at the comments I made in relation to what I wanted from a hire, as long as it meets that, I don't mind. In most cases hires I am involved with we get Mac 250s, which are now discontinued, but they work well so why should we change.
Finally people say about 60 days term for payment, I've never had this problem, actually in the case this year we are paying ahead of the delivery date, so it's just another job out the way, before the stress of a show, but in the past we always paid on drop off back to the company.
If you want any more info just send me a PM.
EDIT: Added information about payment.

This post has been edited by CallumP93: 04 February 2012 - 06:54 PM

[Domski]

Thanks to you all for your time and replies. There's been many interesting comments and lots of information to chew over. Your help is much appreciated.

The overiding feedback I'm getting is that to start a company hiring all kinds of lighting to education and am dram is going to be extremely tough to make sucessful. Mainly due to the lack of funding available for hire and the current cutbacks etc in budgets. If the company was to start the main requirements seem to be well maintained kit at a good price, regarldess of age, with good customer service essential.

What if I moved the goalposts slightly and went for a niche of kit (say movers and LEDs only) available to the whole market but at hire rates too low to miss??

I say this because there is a company in the North West (which some of you will know) doing just this and they are rapidly gaining work. They hire out Mac 250 Entours for £37p/w and Robe Robin 600s for £50p/w! I know they have a stock of around 60 moving heads which is always out. The glaring thing with this is how can you possibly hire out a piece of kit costing £2000 for £37 a week and make money - let alone have 60 of them!?

This strategy is obviously going to make this firm extremely unpopular with other hire firms but if it works as a business is it a bad thing??
Also from a cutomers point of view, If you could hire say a parcan for £1 p/w or a radio mic for £10 a week would you use a company like this??

Cheers.

[paulears]

Yes - it's a VERY bad thing. It devalues the products, and financially seems flawed. There is a market price for most things, and they'll pick up a lot of business, which will generate not huge amounts of revenue, yet if it's in use a lot, the service costs mount up. How long does it take one person to book out, book back in and check and service a product ready for it going out again? An hours worth of time on a hire item takes a big chunk out of your income stream if you're paying staff!

[Jivemaster]

Hire companies exist to make a profit, end of, simple.

First you pick the sector most likely to want high service for least money and pay a long while later, upon which you cannot make a profit.

Second you chose to devalue your service to a point where there is no money to make a profit from after all the work that needs to be done.

Try to find something where you can sell your personal skill for money without too much investment.

edited for spling

This post has been edited by Jivemaster: 05 February 2012 - 06:37 PM

[Junior8]

Never chase a sale on price alone. It's old advice but good - as is the saying turnover is vanity, profit is sanity. Paul is quite right in all he says and such price dumping would probably be impossible for anybody servicing credit. You really have to be hard headed about this and work at rates that will allow a decent return on the capital invested. JiveM makes an excellent point on finding a no capital niche too.

This post has been edited by Junior8: 05 February 2012 - 06:27 PM

[Jivemaster]

Work carefully trough your attributes, see what is unique to you, and highly valued, that way you can get good return on personal skill investment which goes up in value with experience, rather than personal money which goes down in value as people bash your kit around.

[Domski]

Thanks once again for your advice.

I haven't actually chosen to devalue my service as I am not hiring gear at low prices. I'm pointing out an example of a company that does that and seeing what people's views on this are, so that I can see if this is a good option and the view seems to be that this is obviously not a good route to take.

To try and compete with the big boys of HSL and Whitelight etc is not a viable option but you have to start somewhere so am dram and education seems as good a place as any - but answers in this post have been extremely valuable in pointing out the pitt falls of this difficult sector.

Back to the drawing board I think to find a better niche. Thanks for all your comments.

Jivemaster, on 05 February 2012 - 06:23 PM, said:

Hire companies exist to make a profit, end of, simple.

First you pick the sector most likely to want high service for least money and pay a long while later, upon which you cannot make a profit.

Second you chose to devalue your service to a point where there is no money to make a profit from after all the work that needs to be done.

Try to find something where you can sell your personal skill for money without too much investment.

edited for spling

Cheers for this Paul.

This company does really baffle me, as you say financially it seems that there's no way it can work. The cost of 60 plus moving heads plus overheads etc and even if all the heads were out every week of the year I still can't see how it would work. But the guy is by all accounts doing very well for himself and is constantly adding new stock much to the dismay of other local companies. It's a strange one.

paulears, on 05 February 2012 - 06:10 PM, said:

Yes - it's a VERY bad thing. It devalues the products, and financially seems flawed. There is a market price for most things, and they'll pick up a lot of business, which will generate not huge amounts of revenue, yet if it's in use a lot, the service costs mount up. How long does it take one person to book out, book back in and check and service a product ready for it going out again? An hours worth of time on a hire item takes a big chunk out of your income stream if you're paying staff!

[Pete McCrea]

You buy it on finance over three years, and then do your sums to ensure you make money on it. Simples. Or an investor or other source of money. Only issue is that you have to keep the work coming in to keep the finance going.

A quick calculation shows that on £2000/37 gives about 54 - so based on the old rule of thumb of hire price being 1/70th of cost, you can see it works. So based over three years, means that if it works every other week for the 3 years then he'll be quids in. Cash flow is good, so the management accounts look good. That means that the finance companies will extend more credit. He adds more kit, more work, more turnover, more finance, more kit......

There are several examples of 'Trade' only companies where this strategy works well (VER/AED etc), but it requires high investment and kit turnover to keep people coming back. If they've chosen LED then the costs are lower, ensure the systems are lean and process driven again to keep costs down. If you only have two or three types of product to check in, then the time decreases, as they become standard kits that can have missing items spotted easily.

If they're going to the whole market as opposed to trade only, then yes it doesn't do anyone any favours, but hey if it makes him profit, then surely that the aim of the game? We're not all in it for the 'love', shocking as that may seem...

[ramdram]

Well Pete M, that model is fine for a one off company and as you comment a never ending queue of loyal punters too idle to look elsewhere for a better deal...and a finance company who have a lot of cash sitting idle and have to earn something to service "their" debt to the bank/investor so will lend to anyone who appears to be solvent. (You need only reflect on the US housing market to see where that sort of thing ends up.)

But suppose quite a few folk think "I'll do the same"...how can it possibly fail (?) so start shaving off the hire fee because of the (new)competition...a price war...and then some of the movers get abused, because at that price every amdram/Darren the DJ HAS to have a mover(s). Some amdrams/DtD are fine for kit handing and taking care of hire stock...but some are perhaps not so careful or adept at using the kit. You may have noticed the speed the red hot Pars, etc, are dropped off the bars/tripods at the end of the last night...the bar/party is beckoning...

Owing to damage the hire "rate" is now reduced, in charges and volume, and you have to spend real cash (you may not be in profit) to get it mended because the folk who sanction the warranty claims deem the problem was caused by abuse.

Or as is happening some hire outfits can't get enough of the "new, trendy, gigawatt LEDs which can produce Octarine up to and including gamma rays..." (which is now the only kit anyone wants), because their bank won't increase their overdraft.

Makes you wonder just how tight the margins must be even in the mega hire outfits??? I daresay some importers/suppliers may give very preferential terms and even astonishing discounts, or even do the finance thing as well as to the mega hire folk...but not in their first week of trading.

This "niche marketing" notion strikes me as being one you would have to research really, really well. Presumably if there is/was decent profits to be made then the bigger outfits would have it covered...yet from reading above that does not seem to be the case at all.

[Pete McCrea]

ramdram, on 05 February 2012 - 11:56 PM, said:

Well Pete M, that model is fine for a one off company and as you comment ...
{Snip]
because their bank won't increase their overdraft...

You don't need to lecture me on it - I'm in the middle of it on a daily basis - MicroTiles case in point in terms of the List, Trade and 'Trade only' price differences. I completely understand price wars. I might only have been running the business for a shade under 7 years, but I would say I've got a reasonable understanding of what it's like to trade in tough times.

Whether it's right or wrong I don't know, but I've always tried to build a sustainable industry and keep prices up rather that entering into pricing wars. However there comes a time where you'd rather earn something that have kit on the shelf.

That said 'Trade only' can work where it enables us to get kit at say % off trade, then put it out at a trade price to the client.

ramdram, on 05 February 2012 - 11:56 PM, said:

Makes you wonder just how tight the margins must be even in the mega hire outfits??? I daresay some importers/suppliers may give very preferential terms and even astonishing discounts, or even do the finance thing as well as to the mega hire folk...but not in their first week of trading.

Margins are slimmer than a size 0 super model on a celery and water diet. Pull up the accounts of some of those companies, and you'll what they're made of... I don't know of many company owners that are driving round in very expensive cars with massive house and drawing huge salaries. Compare it to the chap in the unit opposite us - he sells specialist diagnostic equipment to the health service. Margin about £20k per machine. But the killer is in all the consumables at something £50/week/machine for the thousands that are out there. That's why he's driving a Bentley, Mazarti, Lexus Hybrid, Fiat 500 and L200, while I'm in my old Y Plate Focus...

[Brian]

kerry davies, on 04 February 2012 - 08:48 AM, said:

Just one more tip, have you noticed the slight upswing in kit for sale on BR? Could be because people are "downsizing" and being more careful in managing stock or because they no longer have economic use for it.

That'll be me then (as well as a few others).

There are a couple of classic pitfalls...

1) A client asks if you have something specialised. You don't but you decide to buy it . It goes out on hire a few times and then sits on the shelf forever gathering dust.

2) You build up a roster of client who keep coming back to you. They get lucky and get funding to buy equipment so all of a sudden they are just hiring in the bits and pieces they forgot to get funding for or didn't buy enough of. It's hard to make money hiring out 15A cables; trust me on that one.