We've seen more rental companies using incentives to recruit talented employees from within and outside the industry. Just as important, they're using incentives to hold on to the good people they already have. In a tight labor market, they know they have to compete for top-notch employees or they might not be able to compete for customers.

Many rental companies are tying workers' salaries to performance. In doing this, the industry might have its best weapon in the rate wars (see “How Do You Rate?” on page 52). When companies make profitability as important as volume in determining commissions, reps make it as important in negotiating with customers. When companies send a “take-no-prisoners” message of grabbing market share, it should come as no surprise that salespeople don't hesitate to slash rates to get more business and bigger bonuses.

But what about drivers and mechanics and counter staff who aren't driven by commission? They, too, can be recruited to the cause through incentives based on a company's or branch's overall performance.

Take this composite example: When a branch's monthly earnings reach a certain percentage of return on assets, a percentage of all additional profits can be put into a pool. Some of this percentage then can be shared with key contributors.

Under this incentive structure, an employee is always aware that extra effort can lead to extra salary. This type of policy can help encourage teamwork and enthusiasm, qualities always welcome at any business.

Incentives are part of the equation, but other factors motivate employees as well. Many companies are giving more control to their managers, allowing them to make key decisions about purchasing, hiring and firing, and, yes, rental rates based on the market. This allows them to react quickly to local realities, but it also gives them a sense that they are part of the big picture — and responsible for how it all turns out at the end of the day, month and year.

At a time in the rental industry when almost every company is bending over backward to accommodate the demands of customers, a few have recognized that some other people also need to be served. They are the people on the front lines and behind the scenes, working hard (or not hard enough) to keep those customers coming back.

Like rental rates, it's a give and take.