'Want to work here? Go make mistakes on someone else's watch'
Kids born into families with established businesses sometimes get hooked. Angus Kennard packaged nails and measured rope at home after school for his dad's firm to sell with the equipment it hired out to builders, tradies and do-it-yourselfers.
"We liked to think of it as child labour but my dad thought of it more as an apprenticeship. We even used to package up explosive charges but you wouldn't be able to do that these days. Learning a work ethic from a young age and working in and around the business was part of life."
Since late 2016 Angus has been CEO of Kennards Hire. He is the third generation to take charge, although he is not on his own.
Sister Kirsty sits on the board. So does his brother Rory, an industrial designer and collaborator on innovative high-tech equipment that the pair are developing.
The youngest sibling, Cameron, runs the property arm, which has 165 stores, mostly owned by the family, in Australia and New Zealand.
Then there's the new breed.
"We have 14 of the next generation, ranging from 16 to two," says Angus. "Whether any or some of them choose to work in the business, it will be their choice. We don't want to put pressure on. It's about pursuing people's dreams.
"The most important thing is, for happiness, you pursue the thing you want to and then do the best you can. Hopefully there will be some interested in the hire business. At the moment I would say there are three or four, even though they are young."
Angus, 48, says there was no certainty he would be where he is today despite his child labour at home and time spent in Kennards branches during school holidays. Before joining the Brookvale outlet on Sydney's northern beaches full-time 20 years ago as a driver and servicer, he sold magazine advertising, photocopiers and forklifts.
He wasn't allowed to join the family firm permanently until he had worked elsewhere for five years.
"That was a requirement my dad made. If you want to work here, you have to go and make mistakes on someone else's watch."
Brookvale was the only store in the group that was a franchise. It was owned by his father, Andy, and a man who became his mentor.
Angus later bought out his dad. He and his partner started a second outlet, eventually selling both to the company. Why? He didn't find the work challenging enough.
"It was too easy living on the northern beaches."
But Angus stayed in the family fold. He had spotted a business opportunity in concrete and was keen to pursue it.
Concreting was actually the foundation of the business 69 years ago when Angus's grandfather, an equipment merchant in Bathurst, was asked by a customer to lend him a concrete mixer. He refused, offering instead to hire it.
Following his own instincts, Angus went to the World of Concrete fair in the US where he found an extensive array of gear never seen in Australia. But it was expensive.
Typically, diamonds are used to polish, cut and otherwise care for industrial-scale slabs. However, the equipment promised tremendous labour savings.
An order was placed, and Angus went around building sites to see what equipment they could use, outlined the labour savings and provided costings. It worked.
Seven years later he sold the business to Kennards, which has since expanded it to eight centres around Australia.
"I was more interested in starting and creating businesses rather than running mature businesses," Angus says.
In 2012 Angus decided to take a break in France with his family. There was no certainty he would return. He opted next to do a global MBA through Sydney University.
"I really wanted to ask two questions. Was I capable of being CEO? The second one was whether that was a job I wanted to do. That program taught me a huge amount about my capability and what I could offer. It helped me answer those two questions."
Last year Kennards needed a new head. Angus's father retired as CEO in 1995, and external managers had been in charge since.
"I put my hand up. [But the family and the board] had to make sure the selection process was right, that they were confident things were in place to ensure success. It's good to set rules and agree how it's going to work upfront. Then there are no surprises and you don't have arguments."
He admits that the family has its differences. But they are strongly engaged in the business and guided by a charter that focuses on the history, philosophy and values set by their forebears.
There are seven points covering issues on how they live, treat each other and behave. Included is his father's old rule about working outside the business for five years.
"Any family that says it doesn't have any conflicts is telling a fib," says Angus. "Every family has their own issues. The main thing is to ensure that there's a lot of equity in the relationship. There are businesses that have fallen by the wayside because of the family, not the business."
The equipment hire industry is estimated by IBISWorld to have annual revenue of $5 billion and employ 16,500.
Sales have been slipping over the past five years as the mining boom has eased but this hasn't worried Kennards. It shuns that sector because of the boom-bust nature of the work. The only service centre it has in a mining town is at Karratha, in Western Australia.
When it comes to his own finances, Angus sticks to the tried and true.
"It is a weakness of mine, not having a personal financial plan. As a family, you are always putting the money back into the business or properties. People often talk about diversifying their investments.
"But if you diversify into something you know nothing about, then that's risk. I've put money into shares and had mixed results. Having passive investments in something like an ASX fund, we are not interested in.
"We like having active investments. We invest in things like technology businesses, we invest in property and in our business. People talk about risk and diversity but we see the lowest risk is investing in what we know. Some of the shares we have bought are in hire companies, and we have done very well."
He has a bearish attitude towards the economy. Property prices are too high compared with wages. There are concerns about what will happen in China and what Donald Trump will do in the US.
If he has one credo, it is to manage the finances very conservatively.
Angus says the biggest opportunities for Kennards come in a downturn. That is when cash generation rises, because less is spent replacing hire equipment as demand weakens.
"You don't hear of many hire companies going broke in a downturn unless they are owned by private equity."
Across all outlets Kennards stocks 90,000 pieces of equipment, not counting items like scaffolding. Most popular are jackhammers. Still stocked are 600 to 800 concrete mixers, the gear that got the company started. It writes 1.5 million hire contracts a year and employs 1400 people.
"We invest in tech that we know a little about.
"For example, we have invested in a company that has a new technology for motors and generators that make them more efficient. That is a good product that we have brought into our business. We also own the technology, and that's sold around the world. We can leverage off that."
Does he have any financial tips?
"You need good tax and financial advice. Structure things right and ensure that decisions you make are for the long term. It's very difficult to outsmart the market. Some of those investments if you follow the market over the long run, generally you will win anyway. Depending on where you are in your age group, it is difficult if you are younger or older and need dividends. You need to be clear about those needs."
Clearly, Angus is hooked on Kennards. But he does have a life outside. He was a competitive swimmer, and played team sports including football, rugby and tennis.
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Now he opts for the thrills and spills of car rallying. He races a high-performance Nissan GT-R in tarmac rally events, including Targa Tasmania.
He has won events in his class a number of times, and last year grabbed his first outright rally win. "I use it as an outlet. You don't always win but I just love the spirit of competition and trying to excel and do better."