David Pattison

Consolidation among UK forklift companies is essential as supply is outstripping demand, a new study says.

Industry analyst Plimsoll Publishing Ltd's latest financial health check for the top 420 UK forklift companies reveals that a third of the UK forklift industry is on the brink of failure.

"A great deal has been written on the general slow-down in the UK, but until now no-one has measured the impact on the forklift market and, crucially, who is most exposed," senior analyst David Pattison says.

Plimsoll has rated each of the top 420 companies into one of five ratings based on their overall financial performance. The ratings are strong, good, mediocre, caution and danger.

The 102 companies that received a "danger" rating have profit margins falling to 1% of sales, and most making a loss and taking on debt to cover costs.

"I think these figures just prove the point that we have all been aware of - that a period of consolidation is long overdue," Pattison says. "Bit by bit, the weaker players will be removed from the market."

The report suggests that up to 135 companies might need to shed jobs and for some, as many as 30% of the payroll may have to go for the company to survive.

Pattison recommends companies with a "danger" rating to implement cost cutting measures before it is too late.

"Currently the owners are sitting on an 'unsaleable' asset and are woefully exposed to acquirers who are ready to snap them up for next to nothing," he says.

The analysis, costing GBP350 (USD690), with names, details and financial performance of the UK's leading forklift companies includes a future snapshot on each company, demonstrating how each might survive a consolidation period. Email c.sherwood@plimsoll.co.uk for more information.