Rental store owners and managers tend to be a rugged breed. Let's face it, the equipment rental business is a business of dirt, grease and diesel. Your job is to provide and deliver dependable rental equipment to your customers.
National companies have slogans to sum it up; “The right equipment, right now,” “The right tool to get the job done!,” or “Rental equipment you can depend on.” That makes the job sound simple. All you have to do is to provide a machine that works when the customer is ready. Right?
Most rental companies are capable of providing this basic service. But the rental business is not as simple as that. My partner, Fred Hageman, and I travel the country evaluating rental companies. One of the most glaring shortcomings we see in many rental businesses is the poor image they project to their customers, beginning at the curb.
Image is hard for most rental company owners to understand. Image is the sum of a number of small factors that add up to create a perception — a perception that operates on an emotional level far from the tangible delivery and serviceability of rental equipment. Let me give a real life example.
Company A and Company B both offer 3-year-old skid-steer loaders for rent. Both loaders are mechanically sound and capable of the job the customer needs it for — a one-week rental for site prep at a small office complex jobsite.
Company A delivers the machine on time to the jobsite on their roll-back truck. The truck is late model, clean, and painted bright red with the company logo, name and phone number decaled on the side. The company slogan, “We Deliver the Best,” and its Web site address are both prominently featured on the truck. The loader is clean, all decals are intact and the paint is not new but is generally good. The seats are without tears and all control knobs and levers are in place. The driver is well groomed and in a clean uniform with the company's name and his name, “Bob,” embroidered on the front.
Bob has a delivery ticket attached to a stainless-steel clipboard and asks to speak with the foreman. Bob introduces himself to the foreman, asks where he wants the machine and asks if there are any questions regarding the machine operation and maintenance. Bob has the foreman sign the delivery ticket. The delivery ticket is a professionally printed document complete with the company's distinctive logo (in red, the company color) and includes all customer and machine data relating to the rental. Stapled to the delivery ticket are operating and maintenance instructions specific to the machine delivered.
Company B also shows up to the jobsite on time. Company B has a 7-year-old, white one-ton truck pulling an equipment trailer that is sometimes rented to customers. The white truck once had the company name on the door, but most of the lettering has come off over time (if you look closely you can still see the outline of the letters). The trailer was once black but is now mostly the color of the underlying steel. Welding repairs are obvious all over the metal on the trailer and several of the boards of the trailer's decking are split and in need of replacement.
The loader is in desperate need of paint and the bucket has some concrete splattered on it from three rentals ago. Most of the decals identifying the manufacturer and model are still visible, but some decals with safety and operating information have been partially torn off and are not completely legible. There are several rips in the loader's seat with the underlying foam visible.
“Bill” gets out of the truck and asks the first worker he sees where he wants the machine. Bill (who did shave and comb his hair on Monday) is in jeans and a greasy work shirt that has his name as well as the company name on it. Bill has a two-part carbon form printed on a dot matrix printer. Bill asks the employee to sign the paper, tears off a copy and hands it to the worker. Bill tells the worker to “Have a nice day” and leaves without discussing machine operation or maintenance. During his mid-morning break, the worker leaves the delivery ticket on the foreman's desk in the job trailer. The foreman later tries to fax a copy to his accounting office, but the poor quality of the copy left him does not come through on the fax.
Which company presents a better image to its customer? Which company has a higher customer satisfaction rating?
Unfortunately, in our travels we see many rental companies out there that look more like Company B than Company A. In fact, the example used for Company B's delivery is a real-life example that I observed just a few weeks ago. The example used for Company A was not a national company, but an image-conscious independent that we successfully sold.
Company A successfully built its image, effectively pre-selling its product and service to its customer and leaving him with a positive impression for future business. None of these actions were huge or costly; most were just paying attention to the small details. Woven together, Company A projected an image that inspired confidence and loyalty among its customers. By a number of small actions (or inactions) Company B's image is suffering and most likely its owners and manager don't even realize it.
To improve your image, focus on things that are front line and most often seen by your customers such as the facility, rental equipment, delivery vehicles, employees and customer correspondence. Here are some specific ways to improve your image:
-
Regular facility housekeeping is probably the most neglected item we see. Make sure your facility is neat and organized both inside and out; curb appeal does have meaning. Some rental owners justify a poor facility appearance by saying that theirs is mostly a delivery business. An organized manager at a medium-sized rental company told me, “Most of our rentals are delivered. Still we get five to 10 walk-ins a day. Plus, we have regular customer training, open houses and barbecues. That adds up to thousands of customers per year that come through here. We have reduced housekeeping to a nightly routine. No one goes home until all floors are swept and mopped, including the shop. The counter areas have to be clear of any debris; no coffee cups or post-it notes are allowed. We walk the showroom to make sure all merchandise is in place. I also walk the yard every day, rain or shine, to make sure it's organized and see what has come in and what is waiting to be serviced.”
-
To get a fresh perspective, have a businessman that you respect from another industry walk through your facility. Have him give you frank comments and impressions. Many rental companies have serious issues with their image caused by facility appearance, housekeeping and organization. Some companies that have not made daily housekeeping a priority may need to bring in a construction dumpster and scrap metal container to get rid of what mostly amounts to junk and clutter.
-
Use your logo. If necessary, have it updated by a graphic design professional. Make sure your logo is conveyed on everything, including uniforms, marketing materials, Web site, invoices, business cards, vehicles and equipment decals.
-
Make sure your company has a professional Web site. Never stop updating and adding to it.
-
Train your counter people and drivers; they are front line with your customers and the image you are projecting. Make grooming and appearance a priority for all employees. All counter people, sales people, mechanics and drivers should start the day with clean and consistent dress. Have training classes specific to telephone etiquette and customer interactions.
-
Your employees will do what you do. Walk the yard and pick up trash. Do random checks of the inside of your vehicles and make the vehicle driver clean up any trash or debris left inside. I recently visited a rental store with housekeeping issues throughout. The owner's office was a disaster with papers literally piled up several feet high in every available space. It was predictable that the shop, showroom and yard were also a mess.
-
Make sure your rental equipment not only runs good but looks good. An operator will treat the equipment the way it looks. Regularly paint your equipment. Make appearance items such as seats, glass, decals and knobs part of your rental-ready inspection checklist. Every rental company has equipment that is more than 5 years old; make sure your appearance standards remain high for the older equipment.
-
Your delivery vehicles are often the first thing a customer sees. Make sure your trucks and trailers are professional looking and convey that your company is concerned with maintaining top-notch equipment. If you don't maintain your own vehicles, why should a customer maintain your rental equipment? This also extends to your other company vehicles, especially sales vehicles.
As mergers and acquisitions consultants, our business is to sell rental companies. Companies that portray a positive image with attractive facilities, motivated and well-groomed employees, and a well-maintained rental and delivery fleet will always bring a premium. We have seen rental stores where a potential acquirer's interest did not survive a walk-through of the premises. If you do sell your business, you can be assured the purchase price will be affected by the amount of cleanup needed in the facilities, and to the fleet and support equipment. A better image and perception of your business will relate directly to a better purchase price.
Image is an intangible that is often overlooked by rental company owners. It won't be overlooked by an acquirer. Image builds confidence not only with customers but with employees, bankers, insurance providers and potential acquirers as well. Providing your employees with a safe, clean, pleasant place to work puts them in a position to provide a high level of customer service that will create loyalty with customers and employees alike.
Gary Stansberry is a partner in the mergers and acquisitions consulting firm of Arlington, Texas, and Cameron Park, Calif.-based Hageman, Stansberry & Associates. HS&A specializes strictly in the rental industry. More information can be found on its Web site at www.rentaladvisors.com. Stansberry can be reached at (817) 563-6882 or by e-mail at [email protected].
