Sound & Stage catches up with Peter McCann, managing director of PRG Gearhouse...
S&S: Tell us how PRG Gearhouse as it now stands came to be...
After acquiring Gearhouse in 2001 we restructured what was a brand with a good reputation in the region, but one that was not achieving the financial success it was looking for. We needed to better harness the potential of the talent in the team by focusing on what customers were actually looking for; be they local event agencies, international production companies or regional corporations, as each was seeking a different level of support as this market began to grow at pace.
Clearly the financial performance of the business was a concern and it was important that we maximised utilisation of the large existing asset base through better asset management and investment in newer technologies, all underpinned with solid fiscal management. It was this approach to encouraging strong financial performance across each element of our business that allowed us to invest whilst meeting the market's requirement of fair pricing.
The next five years saw rapid growth and our market and company became attractive to the larger international players in our field. In 2006, Staging Connections, a public company out of Asia, bought into the business and we had an eight-year relationship with them until 2013. In 2014, PRG sought to take a position in the region by acquiring 100 per cent of the shareholding in order to take advantage of opportunities they already had in the area and foster growth across this market.
S&S: What does the company offer the ME events industry and how does the regional branch differ from other global locations?
We offer our customers tailored solutions, allowing them to take any combination of the elements of our technical management offering which include lighting, audio, video, rigging, software programming and scenic support, the core deliverables in the event space. For me it’s been important not to dilute this and run the risk of losing focus, so this has been our offering since 2001 and has worked well for both our clients and ourselves.
With this model, our fit into PRG globally worked well as this is the structure that is repeated in many PRG offices around the world, sometimes across combinations of depots with one office having more focus in one discipline than others and some in an identical form to ours.
What is the major differentiator for PRG, both here in this region and globally, is that we offer technical excellence in each discipline with a solid understanding of the expectations in each sector we operate in, be that live music, corporate and trade show, sports and special events, theatre, television and film.
S&S: Talk us through the acquisition which saw the formation of PRG Gearhouse…
The acquisition by PRG was a combination of its desire to have a solid presence in this region to grow out of, and my own focus on ensuring that we should be part of a global organisation to access a greater pool of quality talent. We can now offer our team exposure to international events at the highest level, to understand how they operate, bring best practice back into this market and be part of a broader team of professionals.
The benefit for our team is clear and the enhancement to their careers is significant. We can already see international placements, both ways, as we promote both short and long term movement. This region’s quieter summer months are beginning to see significant movement of people and technology from our office here across into Europe. This is brilliant for the team and is the first time I can truly see a confident twelve month trading pattern for our assets — an added bonus that gives us more confidence to invest.
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In terms of technology, we now have immediate access to the largest stock of high-end event technology available and have seen our permanent inventory increase significantly with this uplift, including proprietary equipment such as the ‘Best Boy’ spots, the most advanced automated fixture in the market. These units alone ensure that the touring designers who specify these want to see PRG on their shows, be that on the larger special events or in touring music.
S&S: Why do you think the business has managed to maintain its position for over two decades?
For me it’s clear; our focus has been and always will be on delivering what our customers want and at a price-point that works for them and is fair for the company. Get this right whilst ensuring we can deliver at the service levels I expect to see, and there you have it. It’s a simple formula that’s a tough one to deliver consistently but this has seen us grow year-on-year on both the top and bottom lines of the business. This important bottom line growth allows us to invest in people and technology, which is critical for us to take the business to the next level.
On an operational level there’s a constant need to differentiate, across both the technologies we carry and the service standards we operate to, and we have always sought to create the ‘difference’ across the front-end equipment and the back-room methodology. The biggest compliment to us is that we have set the direction for many who have followed, be that in our introduction of managed venue services into the region or on the adoption of international operational Health & Safety standards, something our industry has recognised us for.
S&S: Has PRG Gearhouse witnesses any particular areas of growth recently?
Considering the measure of instability in the financial markets globally, particularly with Russian and Chinese economies waning and oil prices encouraging regional budget deficits, the rental industry here has fared remarkably well throughout 2015 and remains somewhat bullish.
Growth in the UAE’s touring music business and large ‘special’ event space has supported us well with new opportunities presenting themselves as the geography of the region develops. To support this we’ve progressed with significant inventory increases and in this put a lot of focus on maintaining an ‘A’ grade stock. The UAE remains important for PRG and we can also see significant growth presenting itself across this region through further expansion of our PRG Alliance network. The goal here is to ensure we have the services and technology resources available and closer to our clients right across this market.
S&S: Does the company have any plans for further growth or investment over the next 12 months or so?
These are interesting times across our industry globally and we’ve witnessed significant consolidation amongst the major players, with PRG clearly playing its role in this movement. The economics discussed above suggest that there is scope for more of this activity both on an international and regional level. Let’s wait and see how this plays out specifically for our region and what benefits this will in turn bring to the client base here in terms of asset quality, asset quantity, service levels and pricing structures. These are interesting times.