Over the past 10 years Kosran CEO Patrick Sheeran has campaigned for the industry to adopt better standards of security for plant and equipment. Margo Cole meets the Irishman to find out why he’s so willing to challenge accepted practice.
Patrick Sheeran, the outspoken CEO of vehicle security and control company Kosran, has a simple message for contractors: “Stop hiring unsecured equipment.”
At the moment, standard hire conditions stipulate that any contractor hiring a machine is responsible for replacing it if it gets stolen.
Sheeran - never shy of challenging traditional construction practice - says contractors should simply refuse to agree to this clause in their hire contract. “Our view is that contractors are getting a bad deal and they have to be more assertive,” he says.
And there are options for taking out a loss or damage waiver, or contractors could insist on an anti-theft device being installed.
Sheeran may well have chosen the right time to pick this particular fight. The recession has left many hire firms with large stocks of machines they are keen to get out on hire; so maybe any contractor that needs equipment right now has the upper hand and could shop around until they find a hire firm willing to adapt. If contractors refuse to hire unsecured equipment, reasons Sheeran, the hire companies will be forced to supply machines fitted with anti-theft devices, and may put pressure on the major manufacturers to fit them as standard.
Sheeran, of course, has a vested interest, as his firm makes and sells an electromechanical valve system that can render a machine totally immobile unless it is being used by an authorised operator. But his frustration at the state of the industry is not entirely self-motivated, he says: he genuinely believes contractors are losing out.
“Some manufacturers are focused on security and safety, and stopping unauthorised use of their machines, and they are also interested in protecting their customers’ interest in their brand,” explains Sheeran, who is happy to identify those firms that have shown an interest in fitting anti-theft devices in the factory. Others, however, are less willing to talk, and Sheeran is left to wonder why.
“Our view is that contractors are getting a bad deal and they have to be more assertive.”
He “rejects totally” any argument about the extra cost, given that it costs between £500 and £600 to factory-fit a Kosran device, compared to around £35,000 to buy a backhoe loader, and the cost can be offset against reductions in insurance premiums. That said, hirers only get back the market value of a machine.
Not surprisingly, his forthright views have put Sheeran in conflict with both hire companies and manufacturers over the years. He also finds himself at odds with the industry’s own security committee, saying he is “not interested in just ticking boxes and conforming”. He thinks the group is too focused on tracking and recovery, when it should be aiming at preventing theft in the first place. And its approval scheme for immobilisers, he adds, gives credence to devices that can easily be removed or disabled.
He says he has used one of his firm’s fitters to prove that a device that complied with the industry scheme could be disabled in just one and a half minutes.
This willingness to set the cat among the industry pigeons may be because Sheeran is something of an outsider - an entrepreneur who stumbled into the construction sector almost by accident. He was born in Dublin and went to Blackrock College - one of the city’s best known schools - famed for its rugby prowess. He then studied surveying at the city’s Institute of Technology, leading to an early career in commercial property valuation and membership of the RICS.
At 25, however, he left the cut and thrust of the Dublin property world and spent the next five years on the road as a professional musician and singer. He had played in bands since the age of 16, and developed an interest not just in traditional Irish music, but also in the folk traditions of English and Appalachian music.
“I have played in every Irish bar on the east coast of America and throughout the Midwest,” says Sheeran of his touring years, which also took in a residency at one of Ireland’s top hotels and spells in Germany, Denmark and Brittany in France. “I suppose it was quite a long lead-in before I committed to work, but it was brilliant fun,” he says.
“I think I should have been an engineer and not a surveyor. I find engineering really fascinating.”
When he did make that commitment, he returned to the property sector, taking a stake in various developments - including a chain of upmarket snooker clubs - as Ireland’s property business boomed during the 80s and 90s. At that time the old boy’s network was a big asset in Ireland’s business community, and Sheeran’s contacts from his school days put him in a great position. But, he says, he got bored canvassing old mates, and wanted instead to “sell something and have people come to you if they wanted it”.
That “something” turned out to be a clever anti-theft device for agricultural or construction equipment. It came about thanks to a “fortuitous encounter” with Tom Brazil, professor of electronic and electrical engineering at University College Dublin.
“The idea was not new,” explains Sheeran. “People always had a hidden switch or valve in old MG sports cars.”
He adds: “I also knew that all plant and construction equipment had a single key - a universal key - and I couldn’t believe that. In Ireland at that time there were a lot of machines disappearing and it seemed to be a constant discussion.”
Sheeran took the idea of the crude hidden devices beloved of sports car owners and developed a “smart” valve that fits to the engine and cannot be hot-wired. The only way the device can be disabled is if it is completely removed from the vehicle or machine - and that would take, he says, at least one and a half hours, assuming you had the right tools.
One of Brazil’s masters students was given the task of developing the device, and Sheeran received funding from Enterprise Ireland to get the project off the ground. This led to the device’s UK launch in 1999, since when it has been fitted to more than 22,000 machines.
According to Sheeran, only 19 of those machines have been stolen. More than 2,000 construction machines are stolen every year in the UK, and only about 10% are ever recovered. Most are stolen to order and leave the country within 24 hours, and there is increasing evidence that thieves are using plant theft to generate funds for
It is this fact that accounts for Sheeran’s disappointment that he feels the industry has chosen alternative products that are either easy to disable, simply act as tracking devices once a machine has been stolen, or just help to identify machines if they are recovered.
Although Kosran started out selling directly to contractors, UK construction’s reliance on the hire sector for providing about 85% of large equipment means that many of the devices the firm has sold are fitted on machines owned by hire companies - but nearly always at the request of specific customers, including FM Conway, Balfour Beatty, Skanska, Cemex, Tarmac, Aggregate Industries, Lafarge and Vinci.
While the initial selling point was immobilisation, Sheeran says some contractors are now equally concerned about safety or unauthorised use. The Kosran system - called the ECV smart valve - requires the operator to enter a code into a keypad before the equipment can be started, so a company can prevent unauthorised use by limiting the number of people who know the code.
It will also track the machine if it is stolen or if the customer or owner wants to know exactly where it is operating, and the device can be set so that the customer is alerted or the machine is automatically immobilised remotely using SMS if it goes outside an agreed area - an attribute called “geofencing”.
Sheeran admits that, when he started out on the Kosran “journey”, his intention was to develop the product and then sell the concept to a large manufacturer who would make and sell the device - leaving him with time to improve his golf handicap. When no obvious suitor came calling, Sheeran took control of the manufacturing and sales himself, and now operates factories in England, Ireland and Wales. Last year an injection of venture capital allowed the company to expand, and valued the firm at £12M.
Anyone who has seen Sheeran in action, pressing home the benefits of the device, would assume his natural home is in sales, but this is actually the part of the job he likes the least. “I think I should have been an engineer and not a surveyor,” he says. “I find engineering really fascinating. What ruins everything is having to sell.”
Despite considerable interest from the Middle East and further afield, Sheeran says his next challenge is to crack the European market. With a far less developed hire market, continental Europe may be more receptive, as he only has to convince contractors of the benefits, rather than a sceptical hire industry.
As one contractor said about the cost of fitting the system to an excavator, “that’s the price of a bucket”.
Also in the pipeline is a deal with a major supplier of powered access equipment to supply a version of the device to prevent unauthorised access rather than theft, as well as talks with insurance brokers and lease finance companies to offer incentives and discounts to anyone fitting the system.
And earlier this month Kosran launched a standalone GPS-based tracker that can perform real-time tracking or geofencing for all free-standing equipment with no engine - for example generators, lighting towers and hydraulic breakers.
Despite these exciting new ventures, however, Sheeran has no intention of letting up on his theft crusade.
He knows he rubs people up the wrong way, and it doesn’t bother him - in fact he seems to positively relish the challenge. But what some may see as bloody-mindedness, he attributes to passion.
“People give us money to protect their machines,” he says. “We’re passionate about that.”