Joel Theros looked around at his four branches with nice parking lots filled with shiny brand-new equipment, a top dealer for various brands, with bustling parts counters, shops filled with service work and an organization of more than 100 busy, productive people. He looked at his well-oiled machine that had become a hybrid of full-scale equipment rental and a large dealership and knew his business model was becoming too complicated and difficult to manage.

Theros knew his heart was in rental. He had no problem with coming to work at 5:30 in the morning, being hands-on with everything, doing everything that needs to be done in a rental business — working the counter, calling on customers with salesmen, hooking up machines and doing deliveries. He knew he needed to be making his own decisions at the drop of a hat without having to be concerned about the goals and agendas of manufacturers he was representing. He didn't want to be concerned with manufacturers' warranty rules when his personal and business DNA — forged from growing up around his dad's rental business McLean Rentals — taught him to always figure out a way to help the customer immediately and the most important rules were the Theros rules, which were becoming increasingly divergent from the way a dealership normally operates.

In short, Theros wanted one man to make the final decisions — himself. It's the rental entrepreneurial way and Theros embodied it and knew that was the business model he wanted to follow. Not that Joel Theros is a lone wolf, ricocheting around making rash decisions. On the contrary. He has a solid management team with whom he thinks out decisions carefully, balancing and supporting each other.

“I'm happy that the only person I can blame for my problems is the guy in the mirror,” he says. “I can just talk to him about the problems and fix them.”

Through a life of observing the rental business, growing up in it, working in it from the time he was 12, going off to university and having the opportunity to enter the world of corporate finance and choosing to stick with his father's rental business, Theros, now 39, had figured out his strengths and weaknesses pretty well and had a strong sense of what works and what doesn't in a rental business and how he could use his knowledge and ability to best effect.

“All four of my offices had an overhead structure where I was running parts counters, parts staff, and service personnel and all these people to service the customers as they came in,” says Theros. “The expectation on the part of my customer was that you can stop at any Theros branch and get your parts, get your service, get your rental, and I just found that was not a profitable scenario, there was not enough margin in those parts and new machine sales to justify all that. And rental was beginning to subsidize it, more heavily as time went by.”

Theros began contemplating exiting the dealership business in 2006 to transform the emphasis of Theros Equipment to pure rentals, and by late 2008 he'd pretty well achieved his goal. It turned out to be perfect timing because the equipment sales business was declining by that time, a drop-off that accelerated in 2009.

Theros acknowledges that it may have simply been his own personality that led to the change, just the way he liked to operate, as much as anything the manufacturers did or didn't do. Just the structure of the rental business and the sense of freedom it gives him. But knowing who you are is important in business — if you're not in the right business for you personally, you may not be in the right business.

So how did Theros, who grew up in the rental business, become a dealer? It began with Theros' father, Tod Theros, selling his McLean Rentals to Sunbelt Rentals in 1996 [that acquisition was the key platform that launched Sunbelt Rentals as a national company]. At that time, Theros, who had recently graduated from Wake Forest University, had returned to work full time for the company. Although Theros was weighing an offer to work for a mutual funds firm when he returned in the summer of 1992, he found himself enjoying the business so much he lost interest in the mutual funds opportunity.

After the sale of McLean Rentals, Theros opened Theros Equipment in 1996, but both he and his father were strictly prohibited by a non-compete agreement to engage in rental or anything that was a synonym of that word — thus rent-to-own or rental-purchase agreements were limited.

“We had to just sell equipment,” recalls Theros. “That was it, cash on the barrelhead or financed through a third-party finance company. So we kind of approached the dealership world with a rental mindset because I had never really sold equipment personally up to that point. I had just worked part time and full time at my dad's rental business. We approached sales with the same energy and it worked real well for us. We became a big dealer.”

McLean Rentals, although primarily a rental company, had also been a dealer, selling Mitsubishi and Hino diesel trucks and Toyota, and later Gehl, skid-steer loaders. McLean also took on New Holland, and when the rental side of his father's company was sold in 1996, Joel took over the dealership agreements with New Holland and Gehl under the new name of Theros Equipment.

“There was already a customer base that I could start servicing, there was already a critical mass that I could build on right out of the gate as a result of previous efforts,” says Theros. “So when I started the dealership, I knew I could do it although I didn't really know where it would take us exactly. In '96 it wasn't a certainty that at the end of the non-competition agreement in 2001, that we would go back into rentals. As we got closer to the time, it wasn't that I saw some golden opportunity, or I was timing it correctly, I just liked doing it.”

When the non-compete agreement ended in 2001, Theros began developing the rental side of the business, while continuing dealership activities. The dealership continued to be effective. Theros Equipment was the number one New Holland dealer for several years on both the construction and agricultural side of the business, and the company also took on Kobelco and Mustang rubber track loaders, and all the brands that eventually became Paladin — such as Bradco, McMillen and Sweepster — to complement the New Holland skid steers.

“When the non-competition agreement ended, we kept on selling but we added rental to it,” Theros says. “During the next several years, however, we realized we were a better rental company than we were a dealership.”