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FEBRUARY 2013 issue of
Rental Management

Area Rental & Sales: Reinventing rental in Rockford
02/01/2013

Joe Geraghty has been in the high-reach equipment wholesale rental business for about 30 years, but when he turned 50 years old in 2004, he and a partner decided to launch Area Rental & Sales in Rockford, Ill.

“I still have two other companies that are in high-reach wholesale rental, but the work is done over the phone. You never see the equipment because it is all over the United States, so I always wanted to get into retail rental. When I hit the golden 50 years, I decided to do it,” Geraghty says.

“I wanted to be able to help customers with problems and solve them. Then you can see the tangible results when they come back and have smiles on their faces,” he says.

Area Rental & Sales was initially located about two miles from its current facility and focused on serving contractors by renting construction equipment. However, Geraghty says that when the recession hit the Rockford area in 2008 and 2009, equipment utilization quickly trended downward, especially since Rockford had and continues to have one of the highest unemployment rates in Illinois.

“I knew we couldn’t survive only with construction. I networked with others and many said they were going more into party goods. At that time, I might have had 12 tables and a couple of hundred chairs,” he says.

Expanding into party and event equipment also led to a decision to move the business. “Contractors didn’t care where you were located because you delivered, but if we were going to expand in party and target homeowners, we needed another location,” he says.

As a result, Geraghty found an old National Tire store just outside of the Cherry Vale Mall, the largest shopping mall in the Winnebago/Rockford area. “We moved in February 2010 and opened our doors in March 2010. Since then, we’ve brought in tables, tents, chairs, dunk tanks and traditional party goods and it has worked out very well,” he says, adding that he also bought out his partner at that time.

“If you look at Rockford, there are four corners and there’s a rental store in each corner. We’re in the Southeast and we
do what we have to do. We’ve had to reinvent the wheel to stay in business and that’s what we’ve done, but it is difficult,” he says.

Last year, he also started to carry Ariens lawnmowers and snow blowers, and still carries equipment for contractors, including a few trailer-mounted boom lifts, mini excavators and skid-steers, but he says most of the contractor jobs in the area are government or health industry related projects as no one is building homes.

The contractor business accounts for about 55 percent of the company’s revenue today with about 40 percent coming from party and the rest from equipment sales and repair, since the company now offers lawnmower and snow blower repair as a new service, creating another revenue stream. The company also offers propane, Christmas lights and more.

“On the party and event side, we also started doing some festivals. We took on the Screw City Beer Fest in September in downtown Rockford and provided tents, tables and chairs, but we mostly go after the neighborhood yard barbecues and smaller events. We do not do weddings and we do not want to get into linens, plates, flatware, China and that stuff. With the size of our facility, we couldn’t handle it,” Geraghty says.

The 9,100-sq.-ft. building sits on a little over an acre of land and includes a warehouse, shop and small showroom.

“It’s continues to be very challenging. We’ve had to reinvent ourselves and we are like a chameleon. If you don’t change your color, you go bye-bye. This is not what I envisioned when we started, but I’m having a blast and we’ll see how long it lasts,” he says.

While Geraghty has some mini excavators and skid-steers as part of his inventory, he says the dunk tanks and trailers bring in almost the same amount of rental revenue as the more expensive equipment, validating his decision to increase party and event equipment inventory.

Geraghty says subscribing to the ARA Rental Market Monitor and upgrading to also receive state and market-specific research about the Rockford area is what helped him determine a way forward.

“When I saw the revenue projections for Rockford, party and event revenue was constant, but construction looked like it was going over a cliff. In 2013, they are projecting general tool to go up here and I like seeing that party and event revenue looks to be consistent. Even with the recession in Rockford, people have graduations and reasons to celebrate, so we’re going after that market,” he says.

“You need information and this service has been extremely helpful as we decide how to move forward,” he says.


 

A baseball nut

Joe Geraghty, CEO of Area Rental & Sales in Rockford, Ill., is a self-described “baseball nut.” Behind his desk sit two bobble-heads of former and current Milwaukee Brewers, Paul Molitor and Jonathan Lucroy.

While Rockford isn’t that far from Wrigley Field, the home of the Chicago Cubs, or U.S. Cellular Field, home of the Chicago White Sox, Geraghty says he’s become a Brewers fan and has a partial skybox package for 10 games a year at Miller Park.

“It’s a much easier drive with a lot less traffic and better parking to go to Milwaukee than Chicago,” Geraghty says.

He also hopes to visit Modern Woodman Park in Davenport, Iowa, as he has seen the stadium from the outside, but has not seen a game. The stadium is home to the River Bandits, a baseball team which was a Class A affiliate of the St. Louis Cardinals last year, but the affiliation has changed to the Houston Astros for 2013.

“I drool when we go to the area because we don’t have any franchise in Rockford anymore because the city didn’t support it. We do have a team called the River Hawks in a league nobody knows about. My wife and I go to games two or three times a year and life is good. When I retire, though, I want to do road trips with my wife and get to a lot of baseball stadiums,” he says.

 

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