The American Rental Association has published ARA Rental Market Metrics, a whitepaper outlining industry standards for calculating and reporting equipment rental company performance metrics.
ARA Rental Market Metrics was written to provide equipment rental companies a consistent way of calculating and reporting critical performance measures. It develops industry standards for the definition of a day, original equipment cost, and for the calculation of time utilization of equipment, financial utilization, fleet age and percentage change in period-over-period rental rates.
“Standardizing the methods equipment rental companies use to calculate performance measures will advance individual businesses and industry performance in a consistent manner,” said Christine Wehrman, ARA CEO. “ARA undertook this landmark initiative to further the growth and professionalism of the industry.”
“Several key performance metrics for equipment rental businesses are unique to the equipment rental industry. Most of these metrics are associated with fleet efficiency and utilization,” said John McClelland, Ph.D., ARA’s vice president for government affairs, project leader and co-author of the white paper with Michael Graboski, Ph.D., an ARA consultant. “Consistency in reporting metrics was missing in our industry and made it virtually impossible for rental businesses to assess their performance relative to their peers.”
ARA convened an industry-wide advisory group to lend counsel and advice during the development of the ARA Rental Market Metrics whitepaper. Dan Kaplan of Daniel Kaplan Associates, Morristown, N.J., a rental expert, leading industry consultant, and former CEO of Hertz Equipment Rental Corp., provided the initial inspiration to ARA for this project and contributed to the effort.
Moline, Ill.-based ARA is an international trade association for owners of equipment rental businesses and the manufacturers and suppliers of construction/industrial, general tool and party/event rental equipment.
