As I write this editorial, the U.S. is in the throes of collegiate basketball finals, the National Basketball Association (NBA)
is starting to separate team rosters by wins and losses, hockey is working through a shortened season, baseball spring training is underway and the National Football League (NFL) player free agency is underway with their collegiate player draft on the
This sports activity is only a touch of the competitive spirit that is alive and well in America.
Let’s take that to our industry business perspective, where we can readily attest to the competitive spirit of each and every rental operation as well as manufacturer/supplier. To be in business today one must relish the competitive spirit and embrace it to the fullest.
How you compete and measure your success is your choice. The American Rental Association (ARA) wants to give you the tools to compete. This issue of Rental Management provides a wealth of information for you on the state of the industry from which you can make business decisions. Projections for revenue growth in the equipment rental industry are favorable, in the U.S. projected to grow by over $2 billion in 2013. Long-term, looking ahead five years, IHS Global Insight forecasts the North American industry to total over $51 billion in rental revenue.
These are large numbers to rental operators of any size, signaling rental revenue growth is ahead. To a manufacturer/supplier, this results in increased investment in fleet and inventory. What will be your share?
The ARA provides the statistical information you need to get a handle on charting the future course of your business. The organization has made a long-term commitment to develop and provide rental specific information — unique and one-of-a-kind — that drills down to specific metropolitan areas, with quarterly updates on the economic forecast. ARA Rental Market Monitor™ information, available to rental owners and manufacturers/suppliers by subscription, is applicable to all facets of your business planning.
These are the numbers that give dimension to our industry, describing in economic terms the magnitude of the dollars and cents our industry represents in communities and on a state or national level. These are the numbers that tell a U.S. Senator or Representative the jobs created by our industry and the taxes added to local or federal revenue. They are the numbers that indicate to a lending institution the growth capacity for your business. ARA uses these numbers in all our messages sent on your behalf; you should start using them yourself.
ARA has added to this industry research by developing ARA Rental Market Metrics™ to establish standardized performance measures for use within a rental operation. If your software provider includes these ARA standards embedded in the software provided to your company, you will have consistent benchmarking and reporting tools to measure your performance against any competitor.
The ARA Equipment Rental Penetration Index™, released at The Rental Show 2013, is our latest step in defining and analyzing the equipment rental industry specific to the construction segment. The basic concept of the index is to measure the amount of equipment that is rented as a percentage of total construction equipment. It varies from the sales penetration approach which measures the sale of units into the rental channel, a measure used by manufacturers for some time. Within the last decade, ARA notes that rental penetration has increased by ten percentage points to 51 percent.
So what do these research and statistical best practice standards have to do with competition? ARA has developed this portfolio of standardized tools to help you compete in your business. These are the markers of growth potential, the measures of performance and the guidepost of increasing market share. Unless we know where we have gone, what we have done — how do we get to where we want to go? How do you ever accomplish the goal without measurement along the way?
Compete with the best, go for the result you want … and take the time to implement the ARA tools to let you reach your goal ahead of your competition. Make this your competitive advantage.
Christine Wehrman is executive vice president and CEO of the American Rental Association, 1900 19th St., Moline, IL 61265. She can be reached at 800-334-2177 or 309-764-2475, ext. 280; fax 309-764-1533; or email@example.com.