Come Out of Your Rental Shell - Rental
Construction Equipment Distribution magazine is published by the Associated Equipment Distributors, a nonprofit trade association founded in 1919, whose membership is primarily comprised of the leading equipment dealerships and rental companies in the U.S. and Canada. AED membership also includes equipment manufacturers and industry-service firms. CED magazine has been published continuously since 1920. Associated Equipment Distributors
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Contact Kim Phelan at (800) 388-0650 ext. 340.

Come Out of Your Rental Shell

Written By Kim Phelan

Article Date: 10-01-2007
Copyright (C) 2007 Associated Equipment Distributors. All Rights Reserved.

Marketing (or 'selling') rentals can come in many packages - once you get the basics down, show a little imagination when you're showing customers your rental self.

Comedy is not the thing on everyone's mind when you bring up the subject of effectively denting your market as a player in construction equipment rentals, but ironically two statements from men who could always make us laugh are apropos to the subject of making your mark – and visibly so – in the rental business. 

Groucho Marx made this tongue-in-cheek observation: "The secret of life is honesty and fair dealing. If you can fake that, you've got it made." 

Good one, Groucho, but joking aside, it is legitimacy, integrity and consistency – sorry, no faking – that are indeed hallmarks of the serious-minded rental manager. These qualities play out plainly when you actively pursue selling your rental self out in the crowd. How equipment dealers come at that task, how they assess needs and attract customers to their rental counters is worn right on their sleeves, for better or for worse. 

Later it was Woody Allen who gave us the often quoted (and misquoted) line: "Eighty percent of success is showing up." Except, as we consider the dealer's rental operation, it's more likely that real success only happens for those who show up 100 percent of the time, and by doing so, "show up" the competition every time. 

To Joe Alonzo, sales director at Midwest Aerials & Equipment, Inc. in St. Louis, a large part of "selling" his rental business – which comprises 85 percent of their revenues – is showing up in terms of good old fashioned availability. This is especially distinctive on weekends when some of the big rental operations have checked out. Alonzo says that if a customer calls any of the company's stores on the weekend or after hours, they're instantly forwarded to an on-call staff person's cell phone who can field the urgent need. 

"You wouldn't believe how many people call on the weekends who were not our customers," said Alonzo. "They were using one of the chain rental stores and they say, ‘You know what, I couldn't get a hold of anybody over there.' " 

This commitment to showing up is what Alonzo credits for securing one of the company's most high-profile customers: NASA. When inclement weather prevents the space shuttle from landing in California and must be diverted to the Kansas City Air Force Base, the government has learned to turn to Midwest Aerials for one of its most specialized needs – a piece of lift equipment uniquely suited for inspecting the heat tiles on the shuttle craft.  

But why them? They're not the only lift company around and certainly not the only rental game in town. 

"It's because we're always available – and I mean always available," said Alonzo. "We're within phone's reach 24 hours, and I think they mainly found us because they called on a weekend and we were the only ones that were available and called them back right away. That's our main thing: when you call us, a computer doesn't answer the phone. We want real live people answering our phones and staying with you through the whole conversation until your need is met. 

"There are times when people need you and being able to get a hold of you is a really big thing," he added.

What should never happen at the rental counter is someone telling a prospective customer that (A) you don't have the unit they need – because you'd better find one (and subrent it if you have to) even if you don't have it in your fleet; or (B) you'll call them back and never do. Both of those unfortunate fumbles occurred in a true story related by George Keen, a partner with Currie Management Consultants. 

Keen was hired to consult at a dealership, but before arriving for his midmorning appointment, he called the rental counter at 7:15 a.m., the time they were officially open for business.

"Tina answered the phone after several rings," Keen said. "I told her I needed a particular piece of equipment.

She said they did not have it and I had to ask her if she thought she could locate one. She ended the conversation by telling me she would try to find out and would call me back. Well, she never did. 

"You have one chance to secure the sales opportunity for that rental," Keen continued. The correct response to that customer's request is: ‘Yes, we have it, yes, we'll take care of it' – our first priority is to take care of the customer."

Keen cites a piece of research his firm conducted that ranks customer rental priorities from most to least important, and their criteria look like this:
1.) Availability
2.) Response Time
3.) Quality Product
4.) Equipment Condition
5.) Past Experience
6.) Pricing
7.) Brand name

How Will You Reach Them?
Clearly, getting the house in order is Step No. 1 before you invite company over, or in this case, when you want to put forth a consistently positive image for customers. Presenting an overall posture of availability, both personally and with appropriate rental inventory, is the simplest form of good marketing. Get it right on the home front before taking your show on the road. But when you're ready to sell rentals, creativity and knowing your market are central to success.

For Tom Stevenson, president of HUB Equipment in Toronto, Ontario, doing some of the basics does not have to be boring. 

"We advertise via direct mail, trade shows, trade journals, strategic inserts and most recently through a color, six-page rental brochure," Stevenson said. "It displays many photos of our diverse rental fleet while essentially listing most of what we rent. We intentionally omitted any reference to price and want to graphically convey to existing and potential HUB customers exactly what we currently offer. We are challenged to keep our core group of rental customers best informed of our evolving fleet."

He says the company, an independent third generation AED distributorship that is almost exclusively dedicated to rent-to-rent across Canada and parts of the U.S., also engages in selective e-mail communications when a new product comes into his fleet.

"We want our likeliest users of that equipment to know about it first!" he said. 

Another way to get customers' attention is to try creative marketing solutions, and start with your own best customers. Midwest Aerials does this by regularly putting its money where the customers' mouths are. Each of the company's three stores has a towable barbeque pit, Alonzo says, and approximately twice a month they take lunch to different customers' jobsites. 

"We'll feed anywhere from 10 to 300 guys," said Alonzo. "It works excellently. We have a banner we put up, so when the guys come they know that they're being fed by us. We've gotten a lot of business that we didn't have in the past because they'll say, ‘Hey, you guys care about our guys on the jobs; you're here, you're doing something for us. It has helped considerably." 

His company also puts on golf outings and skeet shoots in some of their markets.

Another simple but effective marketing technique Midwest Aerials employs is active, personal involvement in its customers' trade associations. Each of the sales people in all three locations is assigned to an association such as general contractors, sheet metal, mechanical contractors, etc., and attend monthly meetings, because – go figure – that's where the customers are. 

When market softening eases, Steve Stroshine, equipment sales manager at Wagner Rents in Albuquerque, N.M., says his marketing focus will be on Internet and the oil and gas industry's trade magazines, due to these active segments in his territories that comprise 60 percent of his business.  

"But we have to be careful," he said. "As a Caterpillar dealer you have to stay in your playground; you can't leave. If you have a generator and you rent it in another Cat dealer's territory, it's very much frowned upon.

Hit the Road
Whether the rental side of the dealer's business is lucky – and dare we say smart – enough to fund its own dedicated sales reps just for rentals or if the company's sales team handles both equipment sales and rentals, it's a good strategy to keep them out on the streets where they get accurate, face-to-face pulse readings right where the jobs are. Alonzo says his team uses Construction Project Leads from Reed's Construction Data, such as Reed Connect and Reed Bulletin, to track current project information. But he admits there's no substitute for hopping in the truck and asking questions right out on the jobsites.

Stroshine says he's got six dedicated sales reps for rentals of his dealership's power business, but that model doesn't square with the Caterpillar philosophy on the earthmoving/tractor side. Even so, Stroshine is somewhat of a closet advocate for such a strategy.

"Get some dedicated rental tractor reps out there and watch what would happen," he said. "They could be out driving along and, whoop, there's a Komatsu, so whoop, he turns his truck around and says, ‘Hey buddy, I'm a Caterpillar rep – tell me what I have to do to get my equipment on your job.

"But the reality today," Stroshine added, "is that a pure earthmoving equipment sales guy will say, ‘Yeah, there's a rental opportunity, but, nah, I don't have time – I have to go quote this big 980. He can go out and sell a $500,000 scraper and make an $8,000 commission or he can go out and aggressively pursue rentals and make a $1,000 a month – where do you think his efforts are going to lie?"

Categorizing Customers
An important element to effective, and, frankly, honest rental marketing is the ability to accurately size up your customers, profile them if you will, correctly assessing what they need and why they're coming to you to fulfill it. But that's just half of the equation, according to Keen. It's what rental managers and executives do with that customer information that counts most. He advises careful segmenting of all your rental customers, creating A, B, C and D accounts by volume of revenue they bring to your bottom line, and then utilizing that data to make intelligent decisions about (1.) where you spend your sales and marketing efforts and (2.) what you choose to keep and/or discard in your rental fleet. 

At HUB Equipment, Stevenson makes no apology for this type of approach. 

"We definitely segment and profile customers," he said. "We have even started to do this in our marketing data bases. We continually target our Tier 1 accounts based on loyalty, creditworthiness, need to rent, and match for our niche type specialized rental fleet." 

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Article Categories:  Rental