Renting Offers Contractors New Opportunities

Georgia Sealcoating began as a part-time business in 2004 for owner Greg Owens. Located in Tifton, GA, Owens’ business has grown into a full-time job with six full-time and eight part-time employees. As his company has grown, Owens has been exposed to the opportunities with rental equipment.

“If we get onto larger jobs we rent a crack sealing machine from a company near Atlanta,” Owens says. “That’s been key for us to knock out some of these larger crack sealing jobs.”

With a service area including Mississippi, Alabama, Georgia, and the Carolinas, Georgia Sealcoating works strictly with commercial clients completing sealcoating, line striping, pothole repair, small asphalt repairs, parking lot sweeping and thermoplastic striping.

You Get What You Pay For

Owens first experienced the benefits of renting equipment several years ago while working on a crack sealing project for Moody Air Force Base in Valdosta, GA. Before beginning the project, Owens purchased an oil jacketed crack seal machine.

“It was an older unit, probably around 30 years old, and I got it at a great deal,” Owens says. “But you get what you pay for. We used it for about 20 minutes, and it caught on fire and burned up. They had the whole airport closed down and we were on the runway with a piece of equipment on fire.”

In order to complete the project, Owens turned to renting. “It was on a Saturday morning, and we called the company’s emergency number,” he says. “We were on the road within half an hour to pick it up. It worked really well and ever since then that’s the way we go.”

Owens rents from Road Products, Inc. located in Fayetteville, GA. Road Products, a supplier and rental store was founded in 1996. One key unit Mike Little, manager, rents is a hot applied crack sealing machine.

The Renting Process

Road Products follows several steps in the renting process. First, Little carefully screens each account. “If they are a new business we learn who they are, where they come from, and if there is a financial history to check out,” he says. “Most of these melter applicators range from $40,000 to $60,000 so we don’t want one of these just going out the door.”

Contractors are required to meet special insurance requirements. “The burden of insurance is on the contractor. For this type of equipment it is standard for contractors to have their own insurance,” he says. “Insurance requirements are different due to the specialized nature of this business with hot applied crack sealing.”

If they meet the requirements, a schedule is set for pickup. At that time, contractors must sign a statement proclaiming their familiarity with the equipment. “The renter is required to certify they have knowledge of the equipment and can operate it safely,” Little says. “If not, the operators will be subject to a training session done at our facility.”

Road Products is open from 8 a.m. to 5 p.m. five days a week, but an emergency number is available. “Part of the service is being able to take that call where there is a problem or issue and turn it into a positive,” Little says. “Generally, within about 30 minutes or less that customer is up and running again.”

Capital Outlay and Quality Condition

Owens has found significant benefits for the company in the capital outlay. “A new one [crack sealer] is $40,000 or more, and we don’t see investing that kind of money for using it once every three months,” Owens says. “If I can rent it for $150 per day it makes sense.”

The biggest piece of equipment Owens rents is the crack sealing machine. Georgia Sealcoating recently completed a job crack sealing 20,000 lineal feet. “That would normally take us three to four days with our pour pots to complete,” he says. “With the crack sealing machine we rented, we were in and out in a day. It allowed us to move on to another job faster.”

By renting large equipment and reducing days on individual projects, Owens is able to speed up the whole job gaining more bids and making more money.

Another benefit is the condition of rental equipment. “When we rent a piece of equipment it’s in tip-top shape; we don’t have to do any maintenance to it which saves us money,” he says. “When we pick up the equipment we know it’s ready and that we can turn it on and go to work.”

In the beginning, Owens didn’t realize businesses were renting this type of equipment, but has seen many positive benefits. “Once I found out, it opened up a whole new world to us,” he says. “I found out I could bid on some of these jobs that normally I wouldn’t be interested in doing because there was too much involved. Now we’re able to get on these jobs that normally in the past I wouldn’t have considered doing.”

 

8 Tips for Renting Equipment

Whether you find yourself on a job with a broke-down piece of equipment or are presented with an opportunity to place a bid for a large project, renting is an available option to help complete the job. Greg Owens, owner of Georgia Sealcoating, has seen many benefits to renting equipment. One company he has had great success working with is Road Products, Inc. Owens and Mike Little, manager of Road Products, have several suggestions for contractors renting equipment. By following these tips, contractors can cash in on the benefits that come with renting equipment.

  1. Rental Insurance Unlike standard rental companies that include renter's insurance with equipment such as skid steers, contractors need their own insurance when renting expensive, specialized equipment such as crack sealing machines. By having this insurance, contractors can opt out of other insurance made available by rental companies.
  2. Location Before renting equipment, contractors should consider the location of the rental company as well as the travel time to projects. One disadvantage that Owens faces is the distance between the rental company and his projects.
  3. Flexibility & Time Working odd hours can be a challenge when renting equipment. Owens encourages contractors to find rental companies that are willing to work with them offering flexible pick up and return times. 
  4. Types of Jobs Before renting equipment, consider the current jobs you are bidding. If the opportunity for bidding larger projects presents itself, explore the equipment available to see if renting would be an option for that project. 
  5. Problem Solving Included with renting, Little offers contractors another service — problem solving. If contractors encounter any problems when operating the equipment Little is a phone call away to help get the contractor up and running again. 
  6. Equipment Training Little requires contractors to proclaim their familiarity with the equipment. If a contractor is unfamiliar with the specific piece of equipment he is renting, the operators will be subject to a training period at the facility.
  7. Emergency Option Renting is an option to have for the emergency situations when a piece of equipment breaks down. Owens first used renting after he experienced a breakdown, and this service enabled him to stay on track with his project.
  8. Increased Profit Margins Renting equipment enables Owens to bid large projects while spending less time to complete the job. As a result, Owens has seen an increase in profit margins.

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