Kwik-Fit Fleet (KFF), the fleet service arm of
Kwik-Fit, is seeking business with a wider range of leasing
companies, as it looks to expand the focus of its repair and
maintenance offerings from large corporate customers to the SME
market.
The change is the first significant move in an
expansion drive planned by the Japan-based Itochu Corporation,
which bought the business in 2011.
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KFF’s ambition is to become a primary fleet
service provider to UK local markets, said Kwik-Fit group CEO Kenji
Murai, in his first address to journalists since the group’s
purchase last year.
This appetite mirrors that of many fleet
leasing companies such as Mercedes-Benz Financial Services, whose
head of commercial vehicles Alex Matthews recently told Leasing
Life that the company’s efforts were focused squarely on
growing its penetration in the regional SME fleet market.
According to KFF, some 1.6m vehicles (40%) of
the 4m business vehicles in the UK are light commercial vehicles
(LCVs). With 1.4m of the same business vehicle parc being run on
contract hire, with an average maintenance budget of £2,000 over
three years, KFF puts the value of the nation’s LCV service market
at approximately £1bn per year.
Penetration into this market will see KFF
focus on expanding provision of MOT and servicing products, said
Neil Kidd, the company’s business development manager.
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By GlobalDataKidd estimated 75-80% of the market comprised
Sprinters, Transits and smaller LCVs, and said KFF’s aggressive new
positioning could challenge rival service provider ATS which
previously had the market “buttoned up” by taking the business lost
by incomplete understanding of LCVs at Kwik-Fit dealerships.
Reducing windows
Kidd explained he had been meeting with fleet
managers across the UK to hone KFF’s product offering to suit local
markets, while the company’s staff underwent an extensive training
programme.
Simon Lewis, the company’s operations
director, agreed that at a time with little penetration left to
gain in the corporate sector (the company is sole supplier to Lex
Autolease, Alphabet and Leaseplan in the UK), the SME market and
the lessors serving it was an “area of potential”.
The company is set to make a heavy investment
in new IT infrastructure to help capture a slice of that market and
will decide which system to take on within the next two months.
In terms of changing KFF’s main control system
to suit the SME market, Lewis said that a major priority would be
reducing the windows within which customers could book fleet
maintenance periods. With 30% of KFF’s operations booked two days
in advance, 30% booked a day in advance, and 30% booked the same
day, Lewis admitted it had been a “challenge to keep up” with
shifting demands, necessitating the systems changes.
Lewis expects the company will be able to
offer booking slots to the nearest hour within the next 18-24
months, following the change.
Combined with Itochu’s investment in a new
point of sale system to help give a better idea of stock, Lewis
said the biggest change under new ownership had been “attitude” and
a “major change in direction”.
Lewis said it was “refreshing to be owned by a
company that wants to make money out of our trading,” reflected in
the resources now put into the facilities and service.
“What makes it better for the customer makes
it better for us.”
An interview with Alex Matthews of Mercedes-Benz Financial
Services will appear in
the June issue of
Leasing Life
magazine.
richard.brown@vrlfinancialnews.com
