By Kay Falk,
While you might understand well the equipment you rent out, you might not be as savvy about merchandising related items your customers need when they use that equipment. The good news is that manufacturers of these accessories can help.
Rely on their expertise
One way some manufacturers of gloves, blades, sandpaper, saws, safety glasses and more assist rental centers is by sharing their knowledge. Because they’re the experts in possible uses for their products, they’ve developed ways to sell them in different markets, including the rental market.
Youngstown Glove Co., for example, puts together a counter display of its four best-selling items that do well in rental centers. “The selection is based on our experience selling into the rental market, so there is very little risk on behalf of the store owner,” Ryan Malone, Youngstown general manager and the person responsible for product design and development. “We actually call it ‘The Rental Kit.’ It comes with six each of the four glove styles, so 24 pairs total — and we include the counter display free of charge.”
Thomas Fisher, advertising and trade show manager at Diamond Products (cutting tools), says his company offers merchandising aids, training videos, product videos and promotional flyers.
“To get the right mix of products and merchandising help, just call us or one of our distributors and explain what jobs your customers need to do, the material usually being cut and the volume of cutting that needs to be done,” he explains. “We’ll help you determine what to have on hand at your rental store. We’ll also provide product display stands, signage, product brochures and diamond tool reference sheets.”
Similarly, MK Diamond Products will share its experience with rental centers. “We work with each rental center to develop a comprehensive diamond blade program that matches the equipment in the rental fleet with the blade applications that the rental customers are looking for,” says Brian Delahaut, vice president. “Once this program has been developed, we provide in-store training and support material to help the rental center specify the correct product for the specific application.”
Safety equipment manufacturers are also available to help. According to Jackie Barker, vice president of sales for ERB Industries Inc., known generally as ERB Safety, there’s a safety concern with almost every piece of equipment a center rents. “Your customers might need safety glasses, hearing protection, a hard hat, special gloves or other protection,” she says. “We understand that for rental stores, safety equipment is not their core product, so we have smaller requirements as to shipping, prepaid freight and minimum quantities. This helps rental centers bring in merchandise for less expense.”
Like other manufacturers, ERB Safety offers displays and signs. “We work with an independent network of manufacturing representatives that will call on rental centers and help in setting up display areas, essentially making a space become a ‘safety center,’” Barker says.
In addition to point of purchase displays, signs, training and videos, these consumable item manufacturers sometimes offer special promotions.
For example, Youngstown Gloves features a monthly Hot Buy. “That month, one item is at 20 percent off,” Malone explains. “Dealers have the choice of passing that discount on, but most hold their price and comment on how this is such a nice way to increase their profits in the product category.”
ERB Safety has specials that run in conjunction with industry events, such as The Rental Show, the American Rental Association’s annual convention.
Good profits possible
Most consumable products suppliers allow the rental center to set the price on its items.
“The average pair of safety glasses, for example, costs you about $3,” Barker notes. “You could easily sell them to your customers for $6 to $7. That’s a good margin. If you’re uncertain about how to price items, ask a distributor. Often that sales rep knows how much other rental centers in the area are charging for similar items. Competition is always a factor in pricing decisions.”
MK Diamond publishes a list price for the diamond blades it sells. “Rental centers, however, can set their own prices depending on local market conditions,” Delahaut points out. “Almost every piece of rental equipment using a diamond blade can result in the sale of another diamond blade. Margins of 20 to 40 percent can be attained on these sales.”
Diamond Products’ Fisher agrees. “Consumable items are high-margin items that can help a rental center make money,” he says.
“From previous experience, we see that a typical rental center will go through four inventory turns per year on our gloves, so a counter display could yield up to an added $500 in profits, and a floor display could generate up to $2,000 in profits,” Malone explains. “While we have a MSRP (manufacturer’s suggested retail price) on all items that offers the dealers a 40-percent margin, rental centers are free to mark up items appropriate to their markets.”
He adds, “If a particular product is not moving, we are more than happy to swap it out for another item that is moving to assist in good sell-through. We are not in business to sell someone once. Our customers are our partners and we are here to assist them in any way we can to ensure that they have a good, profitable selling experience.”
Set yourself up as an expert
Our sources all suggest that rental centers do best when they give attention to consumable items.
“Every store is laid out differently, but we see that when a store displays their consumable items behind the counter, out of reach from the customer, this impacts sales in a negative way,” Malone says. “We see the greatest sales when customers can touch and feel the products. If you’re concerned with theft, keep the gloves in clear view of the front counter, but in an area where the customers can play with them.”
Barker adds, “Without taking a lot of the store’s footprint, we can help you set up a safety center where you have what your customers need to protect themselves. You’ll see add-on sales, help your customers be prepared and even reduce possible liability concerns in the event of a later issue. This seems like a win-win situation.”
Delahaut advises rental centers to try to become more of a ‘one-stop shop’ to customers. “Rental centers that offer a solid range of consumables become a valuable and time-saving resource for their customers,” he says.
To do that, know what the customer is trying to accomplish and provide the right tool. “This builds credibility and repeat business,” he points out. “Many rental centers have lost business because they are trying to sell a product they are unfamiliar with and it failed to perform. Working with a good supplier of quality products that fit the application will help your business. For example, make sure your customers know that you offer diamond blades and offer them the opportunity to purchase one with every rental. Almost every construction toolbox carries a diamond blade for use when the need arises.”
Fisher agrees. “Rental centers tend to lump similar products together and ignore the differences between product lines,” he says. “Become as knowledgeable as possible so that the customer depends on you as their primary source — and first place they go to rent. In tough economic times it’s the rental center that can deliver value-added things like knowledge and promotional opportunities that will outlast the competition.”
By Kay Falk,