In at the deep end
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Jamie McDonald set up his dealership RJM Commercials in the peak of the recession, but it is prevailing
Words/Images: Steve ba nne r Leaving a good job after 15 years with a well-known company to strike out on your own, and in the middle of the worst recession since 1945, takes some courage. But that's what 36-year-old Jamie McDonald did.
He left his position as used heavy truck sales specialist at Roy Humphrey's huge site at Brome in Suffolk to set up as an independent dealer RJM Commercials selling second-hand trucks from a site not far from Besthorpe in rural Norfolk. That was getting on for 15 months ago, and so far he has no regrets.
"I'm very thankful to Roy," he says. started with him as a general yard man, then I helped out in the rental department, then [drove a recovery truck and after that I did some haulage driving.
"In other words, I got to know the job. Thereafter he gave me the opportunity to go over onto the sales side of things, which is where I wanted to be. All in all, he taught me everything I know."
So why leave? -There was something inside me that told me that I had to do something for myself, albeit on a smaller scale," he replies.
By that time he was married with two small children. So how did his wife Rachel react when he told her he was going into business on his own'? "She was very supportive," he replies. -She said that if I wanted to do it and I thought I could succeed, then she would back me 100%.
"As it happens, she's got her own business she runs a beauty salon and she told me that if she could help me in any way with paperwork, invoicing and so on, then she would. She's subsequently played quite a big part behind the scenes.
Family time "All she said to me was that I shouldn't leave her and the kids behind and that I should make time for them."
Has he been able to? "Yes, but it requires a little bit of juggling sometimes because what I do often involves working at weekends."
While he uses Besthorpe as the firm's postal address. his four-acre yard is in fact closer to the little village of Spooner Row. "When we first came to look at the yard, it was completely overgrown, with an old Nissen hut in the middle, and I wondered what I was taking on," he says. "However, it had a workshop because it had once been used by a construction plant company."
Diggers were sent in to clear a site that has one big advantage aside from the workshop. Although the location sounds a bit out of the way, it is in fact only five minutes from the Al!. "We're 20 minutes from Norwich. and Stansted airport is just an hour and a quarter away," he says. • Jamie McDonald, proprietor of RJM Commercials, targets ownerdrivers, smallto medium-sized companies that run up to 20 trucks and not surprisinglyfarmers.
To get a feel of where he needed to be in the market, he tried selling vans, 4x4 pick-ups and trailers, but has decided to concentrate primarily on tractor units. "There's not the same level of demand for rig ids in this part of the world," he remarks.
"I like to stock plenty of '04, 05 and '06 units Euro-3 with a sensible mileage and a decent history," he continues. "I can sell as many of those as I can find.
"When we get them, in we service them, sort the tyres out and get rid of all the stone chips," he continues. "Then we offer them for sale as reasonably-priced middle-of-the-road equipment, with everything we retail protected by a three-month driveline warranty."
They are invariably fitted with analogue tachographs, and that is an advantage so far as many of McDonald's customers are concerned. "A lot of owner-drivers certainly prefer them because they don't really want to get involved with downloading information from digital equipment." he says.
'That said, I have to say that their opinions are changing, as are their views about Ad Blue."
Obtaining quality stock is a challenge, as it is for almost all dealers at present. "Operators who have got good equipment are very reluctant to dispose of it," he observes.
If they are willing to sell, they will not necessarily sell cheap.
"Prices have gone up over the past 18 months and we're increasingly finding that we're competing for the available stock with exporters," he says. "As it happens, we've done a bit of exporting ourselves, to Malaysia and Cyprus: trade and export vehicles are sold as seen."
McDonald has worked diligently to locate trucks he usually has 10 to 15 in stock-and his efforts have paid off. "We've found some that will be coming in over the next two or three months," he says.
They are a mixture of Euro-3s and Euro-4s, including some 07-plate Renault Premiums with around 400,000km recorded on average and one owner from new, "They're an inexpensive way of going Furo-4," he comments.
Euro-4 will be essential for anybody proposing to venture into the London Low Emission Zone from 2012, although not all hauliers wish to do so "Those that don't take the view that the rates aren't there to compensate them for the additional costs they can incur," he remarks He has already taken 10 of the Premiums and sold five so far. "Five Magnums arrived at the same time, and we've sold three to date," he adds.
He sells Scanias regularly too.
"They're good news, they always attract customers, butl think the days of everybody wanting a V8 are going because people are looking at the price of fuel so closely," he says, "Most buyers want big cabs, but they don't necessarily want big engines unless they're on European work. Instead, they tend to prefer something that offers 420hp or maybe 460hp."
While he sources vehicles from a wide variety of vendors "I carry a mix of makes, a little bit of everything" he rarely buys at auction.
"I think partly it's because if everybody is after the same truck, then there's a risk you'll get carried away when it comes to bidding," he says. "You've got your cheque book in your pocket, but you've left your brains at home.
"You can get half a dozen guys bidding on a vehicle that you really want, and all of a sudden you find that you've bid 22,000 more on it than you said to yourself that you would when the bidding started," he continues. 'That said, I still go perhaps once a month to keep an eye on prices."
As far as possible he tries to keep the retail prices of his vehicles under £30,000. 'Once you get above that, they become a little more difficult to sell," he says.
Trucks on sale below that figure are not too difficult for the customer to finance and the repayment rates are low enough to be manageable. "A lot of the guys who come to me already have the finance in place," he says.
He sells more expensive trucks, but equally he sells examples priced at no more than 215,000.
"There are plenty of people local farmers for Instance who want something tidy with a respectable history that they'll use for no more than a couple of days a week, and don't want to spend any more than that," he remarks. "I've got more customers than I've got vehicles in that category."
At present, he is happy to sell a truck a week while developing the workshop side of the business's activities.
"We've got four guys working here, and we service trucks for third parties as well as our own vehicles," he says.
He has a three-bay workshop, but plans to add two more bays plus a purpose-built wash. Further expansion plans are in the pipeline he already has four trucks available for rent and he would like to offer more as and when affordable.
"However, I don't want to get too big," he says. "1 want to keep things on a small, happy scale because I don't want to lose the friendly, personal relationship that I've got with customers.
And is he happy he set up on his own? "I'm over the moon that I did it," he smiles.