This week, Business News Wales interviews Naunton Dickins, Managing Director of Caerphilly-based company, Pronto Hire. Digging deeper into his background, professional endeavours and plans for the businesses, Naunton explains why more and more businesses are opting for vehicle hire over purchase options.
Can you give our readers a little background into yourself and your role within Pronto.
The start of my working career happened to coincide with the very early days of the World Wide Web. With no formal qualifications in anything useful, and no previous experience in computing or IT, I decided to jump in at the deep end and have been paddling the internet wave for the last 20 years. After so long spent in the virtual world of bits and bytes, I began to yearn for something more “real” with “real” products and “real” people, so decided to jump ship and head for the hills in search of a new adventure.
The end result was the acquisition in 2015 of a 25 year old commercial vehicle rental business, based out of Caerphilly, called “Pronto”. After all, you can’t get more “real” than a van rental company in South Wales! It could not be more different from the ultra-modern, fast paced world of my previous internet businesses; there are certainly a lot less emails to deal with, which is a genuine life changer.
The last two years have been spent learning the difference between a short, medium and long wheel base vans, while re-investing in a completely new fleet to bring the business and the Pronto brand bang up to date.
What are your plans for the next five years, and where do you see your challenges and opportunities?
The next five years is all about “controlled” growth, both organic and by acquisition. Pronto Caerphilly is just the start of the journey. The challenge is to maintain profitability whilst increasing the customer base and hence the fleet size. Unlike web-based services, where all the money goes into development and you make more money with every new customer, in capital intensive businesses like vehicle hire, your turnover can flatter to deceive. Interest rates can only go one way from here, so always watch the bottom line.
The major challenge is competing against the enormous hire businesses like Enterprise. They have a completely different business model to smaller independent companies like Pronto. They make their money by selling around 60,000 nearly new vehicles a year and are therefore not concerned with price of rentals. They drive the hire price through the floor but as many people will know the advertised price is very different from the final price you pay. This has a negative effect on customer attitudes towards them.
Pronto aim to compete with the big boys with transparent pricing, innovative, compelling and most of all flexible van rental options that are geared 100% towards SMEs.
Looking back at your career, are there things you would have done differently?
Take the cash (if it’s offered!). 90% of the shares I worked for instead of cash proved utterly worthless. Saying that, we did okay out of the 10% that finally paid out!
What do you think are the most important qualities for success in business?
It’s very simple – hard work and bit of good fortune. I’m a great believer in making your own luck; it doesn’t tend to happen to people who don’t also work hard. Never stop “thinking like a customer” all too often you can get wrapped up in our own opinion. Keep asking questions and qualifying what you think, your customers will tell you everything you need to know if you’re brave enough to ask them.
Do you foresee any issues that Welsh business will be facing in the short/medium/long term?
This is nothing new and is not necessarily a “Welsh” problem but the retention and “re-traction” ?! of Welsh born talent is crucial. For so many years anyone with any get up and go just got up and left. This process needs to be reversed. Welsh people are fiercely proud and many would love to “come home” but there needs to be something compelling to encourage them to do so. This is normally either lifestyle or money but you’ve got to throw in “standard of living” – your money goes alot further in Cardiff than it does in London!
Do you have any predictions in regards to the impact of Brexit on your sector?
The bad news is new commercial vehicles are going to get more expensive (this has already started with the introduction of the Euro 6 engines last September). European trade deals aside, the drop in the value of Sterling vs Euro (which is a by-product of Brexit) has compounded the problem. Even though many of the vans are assembled in the UK the vast majority of parts are made in Europe which makes them more expensive in the UK. This means rental companies are either going to have to increase their prices, or have their margins squeezed ever tighter. Agile new players in the hire business, like Pronto will capitalise on this by adding more all-inclusive value to their customers in terms of “mini-fleet” management, in-van technology and more flexible rental options, to make the overall rental price more cost effective.
What skills should the education system be promoting to the next generation?
I looked at the list of the Sunday Times Fast Track 100 the other day – this lists the fastest growing companies in the UK in terms of sales and disturbingly only 2 are based in Wales – why is this?! Don’t tell me it’s due to a lack of investment. Ideas cost nothing and there are hundreds of Venture Capital businesses out there looking to invest. Creativity and originality of thought are going to be fundamental as the workplace becomes more and more “digitised / automated” over the next 10 years. Believe me it’s coming. The Welsh education system needs to grasp this now and start to teach a dynamic creativity of thought as key part of the curriculum.