Franchise profile: Transport and logistics staff provider Driver Hire
Driver Hire’s nationwide network of franchised offices supplies temporary and permanent drivers and other logistics staff to local and national businesses – helping when customers need extra staff to deal with holidays, illness, peak trading periods or business expansion. The business has just enjoyed back-to-back record-breaking years, with a third now on the horizon.
Q&A subject: Chris Chidley, CEO of Driver Hire
Franchised since: 1987
Number of franchisees: 103 offices, 87 are franchised
Network turnover: £94.5m (2014/15)
Turnover growth last year: 21 per cent
(1) What’s the scale of Driver Hire today and is there still room to grow?
Driver Hire rightly claims to be the UK’s leading supplier of staff to the road transport and logistics industry. Our network covers the whole of the UK, from Aberdeen to Plymouth and including Northern Ireland – none of our competitors can match this.
There are no reliable industry figures on the size of the market – it’s hugely fragmented. Driver Hire is the largest single player, but our market share is relatively small. This means there are massive opportunities for growth – our franchisees can sell non-core services including training and licence checking, as well as permanent and non-driving jobs through our subsidiary brand, “dh Recruitment”.
(2) How has business been performing recently?
The last five years have been outstanding for Driver Hire. The recession wasn’t easy, but even through the most difficult years, a number of our franchisees were growing. The downturn affected turnover, but as growth returned to the economy employers were unsure whether to recruit staff. Driver Hire temps provided a flexible alternative. Businesses now have more flexible workforces, so we’re ideally placed to meet their needs.
Our business has seen record turnover in 2013/14 – our 30th year in business – and again in 2014/15. Last year’s turnover (£94.5m) was more than 20 per cent higher than our best-ever before the recession. Driver Hire’s success continues; we anticipate that 2015/16 will be another record-breaking year.
Another way of assessing our overall business success is through franchisee performance and new enquiries; on current trading, the average full year turnover for a Driver Hire franchisee is just under £1m. Compare that to the UK franchise industry average of £356,000 per unit and it’s easy to see why, in 2013/14, enquiries reached record levels.
In 2014/15 franchisees in Aberdeen and Enfield became the first offices to pass the £3m turnover mark. Across the network as a whole, 36 offices were turnover millionaires and 45 grew by 25 per cent or more.
(3) How important a role have innovation and diversification played in the growth of the business?
A very important one. One example is Driver Hire Training which provides, primarily, Driver Certificate of Professional Competence training (Driver CPC) – a legislative must-have for all goods vehicle drivers.
Created in 2010, this service has gone from strength to strength: the Driver Hire network now has over 100 JAUPT-approved trainers. With the addition of new courses currently under development, it will offer 15 industry specific training modules. Since its launch, Driver Hire Training has delivered over 100,000 driver training days and generated over £5m income – an additional revenue stream for our franchisees.
Another recent innovation is “dh Licence Check”. This service helps customers meet legal obligations to check the licences of all employees who drive as part of their job. Following the withdrawal of the driving licence paper counterpart in June, “dh Licence Check” has become even more essential. Already adding to franchisees’ revenues, it’s a useful way of making contact with new clients where, potentially, they may also be able to sell core recruitment services.
(4) Why did the business franchise, rather than expanding through company-owned branches?
The first Driver Hire office was opened in Bradford. A second office (in Leeds) was added. Both traded successfully, demonstrating a huge opportunity for our niche recruitment service.
However, the original owners couldn’t fund expansion from their own pockets. Since their business model could easily be replicated, franchising was an obvious fit. It enabled them to expand quickly to meet nationwide demand – to the mutual benefit of both franchisee and franchisor.
From a customer service perspective, franchising delivers the best of both worlds: the attention to detail only an owner-managed business can deliver, combined with the back-up of a national organisation. It’s proved to be a winning combination.
(5) You have a diverse range of franchisee backgrounds within the network. How do you ensure you’re providing the right support to each of them?
Driver Hire provides support in IT, invoicing, national accounts, marketing and more. We continue to invest in franchisee support – our head office team now numbers 70+. Senior management are always on hand to provide help and advice. And every office has an area development manager to call on.
New franchisees automatically become part of Driver Hire’s Franchise Support Programme – six months of tailored training to help them apply the lessons learnt on Foundation Training. Ongoing coaching is also provided as and when required.
(6) Name three key attributes you look for in your franchisees?
Driver Hire franchisees must be ambitious, hard-working and professional.