Editor’s note: As the equipment rental industry prepares to gather in Las Vegas for The Rental Show 2013, the world’s largest rental-specific convention and trade show organized by the American Rental Association (ARA), Christine Wehrman, ARA’s executive vice president and CEO, looks toward a positive future for the association and the industry. An edited version of her conversation with Rental Management about the state of the industry and the association follows:
RM: Forecasts continue to show the percentage of revenue growth for the equipment rental industry to be about four times that of the GDP in the U.S. in 2013. How and why is this continuing to happen in this economy?
Christine Wehrman: We are pleased that the strong growth trend is continuing. The equipment rental industry continues to build awareness of the many benefits we provide and customers are responsive to this value. Rental companies also continue to develop new market segments or specialties for their services and equipment. The business fundamentals work economically, with rental providing immediate solutions for its customers in an uncertain economy. We have a golden opportunity for the industry to further develop the customer base. The current increased use of rental will continue to sustain market growth in the future as a logical way to do business.
RM: Last year, we talked about how economic uncertainty helped create a window of opportunity for the rental industry to increase awareness of the rental option, increase penetration and grow revenue. Would you say that window is still open? What does the industry need to do to take better advantage of today’s marketplace?
Wehrman: Yes, the business opportunity continues to exist. My sense is that the industry intends to be very aggressive growing the percentage of rental business. If you reference the forecast of the ARA Rental Market Monitor™ and supportive economic information provided by IHS Global Insight, the stars are aligned for continued growth. Add to that the interest being demonstrated in attendance at The Rental Show 2013 by rental companies and exhibitors alike, plus the growth in ARA’s membership, and it becomes apparent our industry is optimistic and well positioned for years to come.
RM: Last year, United Rentals completed the largest merger in the industry’s history with RSC. Volvo Rents has been expanding its network of company-owned rental stores. What does this mean for the industry and for ARA?
Wehrman: Owners and companies of all size rental revenue and all type of inventory are identifying opportunities and how to achieve increased revenue, profit potential and market share. Where capital is available, there is always the possibility of mergers or acquisitions. The trend of specialized rental is a further development. This is a very dynamic industry that is more resilient and innovative than ever. Regardless of company size, ARA members have great confidence in the future. Through ARA, the membership and industry have an effective voice representing them proactively on the issues critical to the future of their business. ARA is their strategic partner in building the future of this industry.
RM: What do you consider to be the state of the ARA today?
Wehrman: ARA reflects the dynamics occurring in the industry. We continue to evolve and change, focusing upon building the success of our members while also advancing the growth of the industry. The volunteer-staff partnership of ARA reflects on what has been achieved, but most importantly, looks ahead — asking what are the opportunities to strengthen ARA’s information, services, products and networking for members. The culture of the association leadership is to focus on fundamentals to build for the future of our members and the industry through ARA. We constantly evaluate where ARA can provide value to give members more success.
RM: Why are you excited about The Rental Show in 2013 in Las Vegas?
Wehrman: I always look forward to The Rental Show with great enthusiasm because it is the celebration of the industry — where everyone takes pride that they are in rental and for their contribution to the industry. ARA is proud to provide this one-of-a-kind opportunity. Rental is a people business, so the networking value is phenomenal at The Rental Show. You learn, see and experience all facets of the industry. It’s highly motivational, producing great energy for everyone in attendance. The show generates great industry momentum, with innovative aspects to experience each year. This industry will generate over $38 billion of rental revenue in 2013 — The Rental Show reflects that economic potential.
RM: What do you see as the future of The Rental Show? What role do you think the show will play in driving the growth of the industry?
Wehrman: The Rental Show continues to reflect the momentum of the industry — and to represent and reflect the potential growth. Attendance is up again for 2013, with a sold-out exhibit floor. The show represents the future of the industry with a three-way partnership between ARA, rental store attendees and the exhibiting supplier companies. We all have a mutual interest in its continued success. This is the one time you have the people, equipment, education — literally all aspects of the industry — networking together to celebrate one another and to address individual and collective priorities. This is a vital, valued industry resource for each individual in attendance.
RM: Looking back at last year, what do you see as the 2012 bright spots for the association?
Christine Wehrman: ARA President Mike Flesher has led ARA to accomplish a number of initiatives yhis year. ARA has experienced 15 consecutive months of continued membership growth. We have had a number of state associations reactivate to benefit
members on a local level. Attendance at The Rental Show increased in 2012. It was a busy year of activity in government affairs representing members at the federal level and we conducted an intensive Get Out the Vote initiative with members. Our industry research and surveys indicate increased rental revenue was experienced by a large share of our members. The economic outlook remains positive, with rental revenue growing at a rate four times the U.S. GDP in 2012 and projected to do so again in 2013. ARA Rental Market Metrics™, which provides members the tool to measure the performance of their business, is in a second year of implementation. The association worked with members and industry partners to complete a Best Practices document for Tenting Emergency Evacuation and a third AWP Best Practice Guide (Hazards) to focus on standards for the industry. We have developed new financial management products and services, published a document to secure financing, and created other new products to build the professionalism of the industry. Regarding industry image, the New to Rental Guide describes how to be successful entering the industry. Members received their first Rental HQ Traffic Report this year to learn the value this member service provides to drive traffic to their front door. ARA and ARA Insurance continue to focus on risk management education and resources. The ARA Foundation had an active year of philanthropic work on behalf of the industry.
RM: What concerns might the association be focused on in 2013?
Wehrman: We anticipate a busy government affairs agenda and will keep our members informed about major policy issues impacting them in 2013 and going forward. ARA is an active industry advocate regarding key issues that impact every member. It will be a critical year for tax reform, health care, environmental regulation, labor, the federal budget and related issues. We aim to stay ahead of the curve, using publications of the Rental Management Group to keep everyone informed. The importance of ARA’s Political Action Committee (ARAPAC) will continue to grow within the government affairs program. The industry information ARA provides is vital to assure everyone is well informed to make knowledgeable decisions for their business. It will be an active policy year, with an eye to both the federal and state levels. ARA relies upon our member volunteer leaders to direct the association, with volunteer involvement and leadership development always a high priority. Certainly we will focus on attracting more members to the association and increased member use of our rental products and services. ARA will stay engaged with further development of 2012 program initiatives. The ARA program of work is directed from a board-approved strategic plan, which incorporates new issues with new strategies each year. The ARA officers, board of directors and staff members, along with our many volunteer leaders, are comfortable with changing, adapting and leading which are inherent in continuous improvement of the association. Our forward-thinking volunteers are open to delivering upon those opportunities that will best serve the members. I see an active year ahead for ARA.