It is a common sight on construction sites across the world: the diesel-powered electricity generator. For one UK construction services business, there was a commercial opportunity in jettisoning these noisy, dirty machines and providing a sustainable alternative.
Nixon Hire, based in Newcastle, north-east England, has in the past two years sold its business renting out construction equipment such as diggers and telehandler lifting machines, allowing it to invest in more environmentally friendly products.
The diesel generators have been swapped for batteries or hybrid devices comprising solar panels, a battery and a generator that runs on hydrogenated vegetable oil, a less polluting alternative. The company has also switched from supplying welfare vans (customised vehicles that provide site workers with kitchen or office space) to portable modular buildings.
The shift has been driven by customer demand for lower fuel consumption and carbon emissions, particularly public sector contractors, which are often required to factor in emissions when tendering for business.
The shift was not universally well received, however, with a more conservative portion of the construction marketplace questioning the benefits of renewable energy over the fossil fuel equivalent, according to Brian Cornett, the company’s recently appointed chief executive.
“We set up sites for sceptical customers to try for free for a week, to break those barriers to entry, the conservative mindset, and fixed ideas about value for money,” says Cornett, who joined the company from rival Speedy Hire. “We’re having to do that much less now, but originally there was such an amount of pushback.”
In August, Cornett took over from Graham Nixon, the architect of the changes who served as chief executive for 10 years after taking over from his father, John Nixon. Graham Nixon remains the company’s majority shareholder.
“The redesign of the company started with the customer, and we used that to reshape our operational dynamics, spending six months in the boardroom and out within our network,” Cornett says.
Convincing staff was also challenging at times. “The biggest challenge to Nixon Hire’s transformation was changing the company culture itself,” Cornett says. “The reality is that not everyone was on [the same] page. So we wished them well and looked after them [financially].”
Another barrier to reinvention, according to Cornett, was a reactive customer services operation. It was using technology that was unable to capture and analyse customer data in a way that allowed the company to foresee and respond quickly to demand. Last year, therefore, the company invested in a bespoke system that can remotely track and report on every aspect of customer interaction and key metrics associated with using Nixon Hire’s services.
The information gleaned from this also provides a new service — data on the sustainability of the construction site, which clients can use to help them win contracts for which sustainability and evidence of carbon reduction is a requirement.
Nixon Hire is also focusing on longer-term contracts, of a year or more, to reduce customer churn and gain more insights; these in turn enable the provision of other “wraparound” services such as security or project consultation.
Turnover rose 8.6 per cent to £108.3mn last year while operating profit rose 6.3 per cent to £7.8mn.
Allan Wilen, economics director at construction market intelligence company Glenigan, says trends in the construction industry are playing to Nixon Hire’s new strengths. There is significant demand for refurbishing or replacing older buildings in order to improve energy efficiency, he adds.
According to Glenigan data, an estimated £129bn worth of construction plans in the UK were approved but not started in the year immediately before chancellor Rachel Reeves’ Spring Statement in March, when she pledged a total of £113bn in capital spending over this parliament.
“With the extra funding kicking in from April — increased capital funding for health, education, increased investment into the civil engineering side into renewables, upgrading the transmission networks and the water industry spend, it’s a massive increase they’ve been given for the five-year period,” Wilen adds. “It is going to be both politically and environmentally high on the agenda.”
A 2023 parliamentary environmental audit committee report said the built environment was responsible for a quarter of all UK carbon emissions, with construction accounting for about a fifth of that, according to industry body UKGBC. While much of that was due to the carbon-intensive production of materials such as concrete and steel, the emissions on construction sites also play a role and Nixon Hire can claim to have reduced these for its customers in a measurable way.
“The next generation is already passionate about sustainability and the environment. It’s reshaping the UK, and we want to play our part in that,” says Cornett.