Good interview today of Alf on Ozbiz.
At the end of the interview, he explains, according to him, why Servcorp is different from its competitors :
- Servcorp has 12 employees for 100 offices vs 2 or 3 employees for their competitors,
- their peers do not have the geographic diversification of SRV,
- they do not have the critical mass,
- they do not understand churn (about 70 % in this industry vs 50 % only for Servcorp).
I see a couple of other reasons why Servcorp is so successful vs its competitors :
- SRV has a lower breakeven point vs their competitors,
- SRV costs are not as fixed as I thought initially (cf - 20 % for overheads in FY 20 when they decreased their capacity), not hesitating to stop existing leases and probably good ability to renegotiate with office owners when times are tough.
- SRV active management of its portfolio probably explains why they keep having a good level of occupation.
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