A “small number of redundancies” have been announced under plans by a Leicestershire business to pull out of the plant hire sector.
Civil engineering firm Danaher & Walsh Group – recently named Family Business of the Year at the 2019 Leicester Mercury Business Awards – said it was pulling out of that market because of lower margins and tougher competition from big operators.
The group, whose primary activity is civil engineering contracting, will wind-down its plant hire subsidiary which accounts for around 10 per cent of turnover, by the end of June.
It wants to focus on its busy civil engineering division and its growing Advanced Pipeline Solutions (APS) business, both of which, the business said, have enjoyed record trading years.
In a statement the Mountsorrel-based group said: “A small number of redundancies will be necessary, though every effort is being made to relocate affected employees into other parts of the business.”
Managing director Dan Danaher said: “This difficult strategic decision has been made with a heavy heart and after extremely careful consideration.
“The changing dynamics of the plant hire market mean that it has become increasingly difficult for medium-sized business like our own to compete against larger, national hirers.
“Our analysis suggests no indication that this situation is likely to improve in the near future.
“Ever increasing costs have far outpaced growth in charge-out rates, meaning profit margins have been squeezed.
“Furthermore, a saturated market has made it very difficult for us to achieve utilisation rates anywhere near what is required to be sustainable.
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“I am extremely grateful to everyone in the plant hire team for their hard work and dedication during their employment with us.
“The plant hire business is a very important part of Danaher & Walsh’s history, and it is with deep regret that we exit this market.
“However, whilst we are very proud of our past, we must look to the future and adapt our business accordingly.”
The family-owned business dates back to 1969, and has clients within the public and private sectors.
It specialises in highway works, drainage and infrastructure, bridge repairs and maintenance, urban regeneration and environmental works.
