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JUNE 2013 issue of
Rental Management

Cover story: Transforming rentals image
Cover story: Transforming rental's image
05/31/2013

Professionalism and service move the industry forward

James Keenan founded Keenan Rent All in Omaha, Neb., in 1958 after starting out as a farm machinery dealer. As one of the equipment rental industry’s early pioneers, it was Keenan who recognized the need to present a better image to customers more than 40 years ago.

While serving two terms as American Rental Association (ARA) president in 1973-74, Keenan focused on the rental industry’s image, creating the President’s Image Building Award first presented in December 1973.

He talked about service image — having the facilities and personnel so customers can get what they want and what they are willing to pay for; inventory image — having fully operational equipment that serves the customers’ needs; and public image — operating a pleasant and inviting facility.

Keenan passed away in 2004, but it is likely he would be proud of how the equipment rental industry has evolved into today’s service-oriented professional businesses that have helped transform rental’s image while generating more than $33 billion a year in rental revenue in the United States alone.

That change has accelerated over the past decade and particularly in the last few years as those surviving the recession are thriving and taking advantage of selling the benefits of renting equipment to a wider variety of market segments. The result has been greater rental penetration and a more general acceptance of the rental concept by consumers for construction and industrial equipment, general tools, and party and event equipment like tents, tables, chairs and décor.

Some of the credit is due to the national publicly traded equipment rental companies that also have recently focused more on image, service and reliability.

“Consolidation had a major role in advancing the industry. The word was not comfortable for the industry at the time, but consolidation advanced the dimension, dynamics and offering of the industry. It stepped up the game of competition within our industry with companies of every size,” says Christine Wehrman, ARA’s executive vice president and CEO.

“Some may disagree with that analysis, but today rental has greater visibility. The industry has greater mass and greater potential as a result of those changes that have come from consolidation and economic dynamics of the last decade. We learned a lot. We learned we can be there in a crisis like 9/11, provide valuable services and be immediately available for assistance. I’ll never forget that day and the many following months, being so proud that our industry stepped up to be there for the people in need. Rental equipment was vital for the human emergencies and for the re-building that followed,” Wehrman says.

“The industry realized it could provide solutions when Hurricane Katrina happened and we survived an economic recession never before experienced, while increasing the use of rental. The industry came out the other side of the economic recession and has strengthened the value of rental, its services and its businesses to the overall economy. This is the result of learning how to adapt, how to excel and how to present the industry as a professional service and a solution readily available and always at the call,” she says.

Michael Kneeland, president and CEO, United Rentals, Greenwich, Conn., has been in the rental business for 35 years and also believes the industry must continue to enhance its image to attract the next generation.

“Because of our size and stature, it behooves us to be good stewards of the industry. You don’t get someone from college coming through the door with the knowledge we all have. A lot of us came up through family or smaller ownership, but we have to attract people because rental is a people business. We have to bring in the next generation,” Kneeland says.

“The question is how to get them into the marketplace and show them there is a career here over time. An important aspect is that rental is not dirty, gritty construction, but a very professional business. Diversity is another aspect and safety is critical. These are all things the industry can do to enhance its image and it is what will draw the next generation,” he says.

Buddy Stubbs, president, Busylad Rent-All, Tupelo, Miss., remembers a time when the rental business was more like dirty, gritty construction.

“When I think back to the 1980s, an equipment rental store would have tools piled on a table. Customers would sort through to find what they wanted. When they came back, they put the tool back on the table unless they said there was a problem. There was little cleanup or attention to safety going on,” Stubbs says.

“When consolidation came, competitors came out of the woodwork. You had to clean up and display your tools better. People were dragged or pushed into it. People see the big box stores and when they are going to rent, they expect to see the equipment lined up and on display,” he says.

“Without a doubt, the national companies had marketing and had a plan. They advertised more. They had salespeople on the street. Whether you liked them or hated them, they expanded the business exponentially,” he says.

Stubbs says part of the result is that the image of owning a rental store has better status than it used to. “People would think running a rental store was like having a gas station. I’m not putting either business down, but it wasn’t the same as saying your father worked at a bank. Now, I’d rather my kid says that I work in a rental store rather than a bank. The industry has changed and the perception has changed. People are more accepting of rental and know they can get the latest equipment to get the job done,” he says.

“Without a doubt, the industry is much more professional and ARA has helped with that. People don’t just rent tables, chairs and tents now. They go to the rental store to find out what they need and are starting to see us as the experts,” Stubbs says.

Beth Hoff Blackmer, president, Aspen Rent-All, Aspen, Colo., says cleanliness has become more important as well as better organization in showing off equipment that is ready to rent. She also remodeled her facility and won a President’s Image Award last year.

“I believe when people rent equipment, they are looking for good, quality products that work. If the first thing they see is a messy location, I feel it compromises your potential reputation. The contractor expects the equipment to be in good shape,” Blackmer says.

The industry’s image, however, isn’t just tied to the visual look and feel of a rental store’s facility. Over the past decade, with  technological advances, education and training, industry-specific research and more, rental companies of all sizes have taken steps to advance the industry’s professionalism, provide superior service, foster customer relationships and promote the rental concept.

“I think the ARA has helped the industry tremendously by making the business more professional. We are respected as educators to our customers and also documents like the Cost of Doing Business Report show banks and others that we are organized and professional as an industry,” Blackmer says.

“We need to keep working on our relationships with our current customers and find new customers and educate them on how we can help them. We are much more than just a location to get tools. We solve problems,” Blackmer says.

“More than ever, consumers are looking for easy, convenient, cost-effective solutions and that is what our industry represents,” says Mike Blaisdell, vice president, Bunce Rental, Tacoma, Wash., and ARA’s president.

“Change has been seen in the way the industry and rental companies continue to push the benefits of renting by aggressively marketing the rental concept and why renting makes sense. Technology and electronic media have played a key role in the ability to market to specific consumer groups and market segments. Industry image continues to evolve as rental companies offer more innovative equipment, more services and professional, customer-friendly facilities,” Blaisdell says.

“In looking back just five years, the difference in how we market our business and reach consumers is night and day. Through online and social media-based marketing, we are able to reach more consumers and we are able to target and reach those consumers faster than we ever have before. This ‘new age’ of marketing has been a driving factor in increasing awareness of the rental concept,” Blaisdell says.

Stubbs says there’s also a distinct difference in the image and reputation of the party and event rental segment. “When my wife and I were married in 1982, we didn’t rent a thing because the caterer had everything. Now, weddings are very elaborate and our rental selection is much wider. We did our first wedding over $10,000 in 1995. I never dreamed of doing anything that big. Now, that’s a commonplace wedding,” Stubbs says.

John Crabbe Jr., CERP, president, Vermont Tent Co., South Burlington, Vt., remembers going on calls 20 years ago where the customer was surprised that he wasn’t a bearded guy wearing a flannel shirt who worked for the circus.

“We didn’t get respect then, but now, people are not afraid of rental anymore,” Crabbe says, adding that the attitude toward renting has changed dramatically as people see tents used at athletic events, golf tournaments, fairs, festivals, fashion shows and other high-end events.

Visibility through social media, cable TV shows about weddings and more also has elevated the image of the equipment rental industry and particularly helped those in the party and event segment.

However, Crabbe admits there was a time when he did not want customers coming to his facility, which was basically a warehouse. That, too, has changed, as Vermont Tent Co. now has a modern showroom and conference room that is sometimes used by caterers, bakers and event planners for meetings with clients who also are renting tents and other items.

“We’re more professional now and we have to be because consumers are more educated. We also now have more symbiotic relationships with caterers and event planners. Before, we were concerned about our bottom line and didn’t care if the caterer had a problem. Now, the whole goal is to make the customer happy and you think about how everybody can be more successful,” Crabbe says.

The changing image and business practices of equipment rental companies also has caught the attention of investors and analysts.

Scott Schneeberger, CFA, managing director, business services equity research, Oppenheimer & Co., Stamford, Conn., has followed the equipment rental industry since 2007, paying particular attention to RSC prior to its merger with United Rentals.

Schneeberger says a big difference today, especially among the national companies, is a commitment to service.

“A United Rentals truck in my area has the catch phrase ‘Consider it done’ printed on it. Ten years ago, United Rentals could not have said that. Now, they have internal metrics, they measure equipment that is not out on rent, what’s in transit and what’s in service to minimize problems and to be reliable. That service is huge to accelerate a more positive image of rental,” Schneeberger says.

“Where my opinion changed, as we moved through 2010 and 2011, it was evident United Rentals was growing, top-line organic growth in double-digits, when nonresidential construction was not growing. That’s the secular shift to rental that we write and talk about with the rental versus buy model for end users. Everyone, I think, has come to accept that now and sees there is an acceleration of rental,” he says.

“My short answer about the future is that we will see more of the same growth for the equipment rental industry once end users see
the service proposition and how easy and reliable renting equipment can be. When companies compete on service, it lifts the whole industry. We will continue to see a shift to rental versus buying or owning equipment, but the best thing the industry can do for its image is continue to push the service proposition,” Schneeberger says.

“The equipment rental industry provides certainty in a very uncertain world. From the recession to Hurricane Sandy, the relief, solutions and accomplishment of business is delivered through the rental industry, increasing the industry visibility and image many-fold,” ARA’s Wehrman says.
 

Setting a strategy

Setting a strategy at ARA

Part of the recent transformation of the equipment rental industry’s image can be traced back to the American Rental Association (ARA) and the decision by the association’s board of directors to develop a strategic plan in 2001.

“The board recognized the need to take the industry and ARA to the next level of leadership and it was done through the strategic planning process in 2001,” says Christine Wehrman, ARA’s executive vice president and CEO.

“We brought industry leaders together through ARA representing a diversity of company rental revenue size and rental inventory. Survey work was completed, asking, ‘Where are we?’ and ‘Where do we want to go?’ ARA spent a year analyzing data and talking with both rental and associate members,” Wehrman says.

The result was the ARA Strategic Plan, which is reviewed each year by the ARA board of directors with ARA staff member input and feedback from ARA members through ARA’s committees. In addition, ARA continues to survey members throughout the year. The plan includes six defined goals:

  • Information source and resource. ARA will be the leading source and resource for information regarding the equipment rental industry.
  • Advocate for industry growth and success. ARA will be the recognized voice and advocate in government affairs on issues of importance to the equipment rental industry.
  • Industry image. Consumers will experience and recognize the equipment rental industry as a professional first solution for their equipment needs.
  • Resources contributing to business success. Members will view ARA as a valued and reliable partner — providing tools, information and resources contributing to their business success.
  • Buyer-seller connection. Buyers and sellers in the equipment rental industry will find mutual benefit from ARA’s facilitation of relationships and connections.
  • Organizational effectiveness. ARA’s organizational structure and culture will support the achievement of ARA’s purpose, vision and goals.

“A lot of time was taken to formulate these goals. In 2001, minimal data was available on the rental industry. The goal of ARA serving as the information source and resource for the industry was created and led to the development of the many industry research and ‘Best Practices’ statements that ARA continues to produce today. The very first program undertaken within the goal was to define the rental revenue size of the industry. Government affairs was identified as a key priority to build an increased federal and state presence for the rental industry. ARA is providing a government affairs program for the industry that is an effective voice including and involving the membership,” Wehrman says.

“The next priority concerned image and for companies of all size rental revenue to present the industry in a business-like, professional manner. ARA focused on providing members with education and training as well as revitalizing The Rental Show to be the dynamic focal point celebrating the future of the industry. As well, ARA focused on how the association presents itself to the membership and industry through our messages and branding. The strategic plan is all about ARA promoting the success of our members and advancing the growth of the industry,” Wehrman says.

As result of using the Strategic Plan as a roadmap, ARA has created the ARA Rental Market Monitor™, ARA Rental Market Metrics™, the ARA Rental Penetration Index, the “Statements of Best Practices,” the ARA Professional Drivers Education Program, Rental HQ, a focus on safety and many more products and services to enhance the equipment rental industry’s image and professionalism.

“The American Rental Association has been a catalyst in changing the image of the industry. Visibility and exposure of the equipment rental industry has been driven by the rental-specific market information via the ARA Rental Market Monitor, compiled by IHS Global Insight. Not only is this research a valuable tool for our member businesses, but it has also enhanced the national perception and image of the equipment rental industry,” says Mike Blaisdell, vice president, Bunce Rental, Tacoma, Wash., and ARA president.

“ARA’s risk management tools, such as the ‘Statement of Best Practices’ documents, have enhanced the professionalism of the industry. The many risk management and business resources that ARA has available are tremendous resources to members and key to growing the professionalism of the rental industry,” he says.

“As an industry, we need to continue to build awareness and professionalism. Going forward, I see a greater emphasis in our industry on safety and training, which will build on the professionalism of our industry. As rental companies continue to improve their quality, depth of equipment and service offerings, more consumers will be made aware of the rental concept,” Blaisdell says.
 

Recognition for a better image

Recognition for a better image

James Keenan, founder of Keenan Rent All, Omaha, Neb., traveled extensively, visiting scores of other rental stores to study the industry in the early 1970s. When he became president of the American Rental Association (ARA) in 1973, he said he would focus on the industry’s image.

“We’re going to try to spread this image concept in 1973,” he said in the February-March 1973 issue of Rental Age, which later became Rental Management. “The know-how is already there, but we must see the need and devote the time. We sometimes fail to set a priority on image until we know a visitor or important person is dropping by … But my thinking is this: Who is more important than the customer?”

In the December 1973 issue of Rental Age, Keenan introduced the ARA President’s Image Building Award to recognize members who had either built a new store or remodeled an existing one. A member also could qualify for the award by showing innovations, such as an improvement in the yard layout or display area.

“There is no better way I can think to say, ‘Thank you,’ to those ARA members who have helped build a better business image for the rental industry,” Keenan said in Rental Age.

First-year recipients were Al Redburn, Rental Exchange System, Wichita, Kan.; William Turk, McAllen Rental Service, McAllen, Texas; Alan Connole, Blue Springs Rental Center, Blue Springs, Mo.; Al Baclawski, Adam’s Rental, Littleton, Colo.; Walter Shipp, Indiana Rental, Carmel, Ind.; Charles Bradley, Big 4 Rents, Corte Madera, Calif.; and Tom McWilliams, Denver.

The award, now the President’s Image Award, has lived on as a business facility or store award celebrating a commitment to improving the rental industry image through a remodeling, rebuilding or renovation project.

The 2012 President’s Image Awards were presented at the Regional Receptions at The Rental Show 2013 in Las Vegas. Winners included:

Region One: Steve Reitter, Robinsons Hardware, Hudson, Mass.

Region Two: Alan Wismer, George’s Tool Rental, Hatfield, Pa.

Region Four: Karen Keesler, One Stop Tents & Events, Webster, Texas.

Region Four: Bryan Wolf, Rental World, Harlingen, Texas.

Region Seven: Beth Hoff Blackmer, Aspen Rent-All, Aspen, Colo.

Region Eight: Larry Steele, Aurora Rents, Seattle.

You can nominate yourself or any of your peers that you think might qualify for a President’s Image Award. Nomination forms for the President’s Image Award are available online at ARArental.org under the “About ARA” tab. Click on “Recognition,” “Awards” and then “President’s Image Award Nomination Form.”

The deadline for nominations is Sept. 1 of each year to be considered for awards presented at The Rental Show. For more information, contact Jenni Venema, ARA’s director of association programs, at 800-334-2177, ext. 236, or email jennifer.venema@ararental.org.
 

 

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