George’s Corner: August 2011
By George Olah
George gazes deep into his crystal ball.
By George Olah
To write this column, I decided to rely on my background in economics and training in multivariate time series analysis. After ploughing through reams of time series data, I pulled out my Ouija board. What follows constitutes my best guesses, which are clearly open to heated discussion at your nearest tavern and bar.
The next generation of both customers and rental operator staff will increasingly embrace and rely on laptops and improved electronic communication devices. Likewise, rental business websites and electronic web catalogues are burgeoning and will continue to be an inextricable part of our rental industry.
The continued computerization of equipment, along with the plethora of new technical and safety regulatory requirements, will continue with vigour – and so too will the need for more and much more training of both rental staff and customers. Better-trained rental customers will use your equipment more safely and hopefully return it in better condition for the next renter.
Recent observations of events in the rental industry in Canada point to what appears to be a never-ending consolidation of our industry. And I wonder out loud if this is an indication of where we are really going and perhaps may end up. All of us have seen industry consolidation going on in earnest for the last decade. When is this going to end or stop? More importantly, will the majority of the rental industry simply be consolidated into five or six major corporate entities?
So what does the proliferation of all these types of rental stores mean for our future business? Well, for one thing, it is getting clearer that customers like one-stop shopping, or should I say one-stop renting. Remember, the larger the work projects or special events, the larger and more varied the equipment and supply needs are. After all, why not rent from a location where you get all your rental requirements and accompanying supplies so you don’t have to spend your valuable time travelling to get what you need from several locations. In this era of high-priced fuel, the customer is sensitive to spending extra for delivery from different rental shops and locations. Also, shopping one super rental shop can simplify your billing. Well, that’s one point of view at least.
In addition, a full-service location makes it easier for future rents. You usually end up with the same contact individual, the same delivery drivers. As a larger rental operator you can buy more products and reap the benefits of buying more at discounted prices. This all spells convenience and cost savings for both the rental operator and the customer.
Using somewhat the same logic, smaller rental shops will establish more satellite locations. In fact, several smaller rental companies are already co-operating in loosely knit strategic relationships, allowing them to share and provide more marketing, supply and rental products to meet head on the competition from larger corporate competitors.
Ultimately, of course, the real question will be to merge or not to merge. Merging can have benefits, but big is not always best. Ironically, only time will tell. Discriminating customers do and will demand and expect the provision of specialized and particular expertise in rental areas such as special events, temporary winter heating, aerial equipment and skid steer equipment to name a few. Such rental services will make for better project completions and higher returns on investments.
While clever marketing programs will proliferate electronically, no crystal ball need be consulted to conclude that, in the future, consistency and excellence in personal service will continue to be the key component for every rental business, big or small.
George A. Olah has over 35 years of experience in training, marketing, and renting commercial appliances and equipment. He is presently the general manager of operations at ABCO Equipment & Supplies, a family-owned rental company.