How the Rental Industry's Technological Evolution is Affecting Your Business

Businesses are actively searching for improved operating systems that not only support their day-to-day operational needs, but systems that also assure capabilities that drive increased growth, far into the future.

As of 2017, the American rental industry is worth $39 billion, with a projected average compound annual growth rate of 4.4% to reach $59.4 billion by 2021.* Our industry is growing at a rapid pace, backed by stronger consumer demands and improved spending from the industrial and construction equipment sectors.

With rapid growth and favorable projections, conventional technologies are now battling to keep up with the complexity and magnitude of the industry’s technological evolution. Businesses are actively searching for improved operating systems that not only support their day-to-day operational needs, but systems that also assure capabilities that drive increased growth, far into the future.

Challenges for rental companies and customers

Managing a complex structure through system integration - Regardless of the size of the company, the rental business involves multiple layers. As businesses grow and the customer/equipment portfolio diversifies, processes tend to become more involved and require advanced support - quoting and renting, procurement and vendor management, timely monitoring of inventory and warehouses, ensuring equipment maintenance and service scheduling as-well as reporting and visibility - all of which are now heavily reliant on system integration.

Equipment availability - The ability to accurately track an equipment item is now an essential requirement of any dedicated operating system but further, so is the ability to identify whether the item can be rented immediately on return, or if servicing/inspection is due. The process needs to happen fluidly, from the moment the rental inquiry is made, to the equipment servicing/inspection due, and back to rental availability again.

Profitability - When managed efficiently, rental businesses can generate a positive, long-term revenue stream through the right balance between investment and cash flow. Typically, an equipment item should return 25% of its purchase price annually, and in the absence of a dedicated asset management solution, calculating depreciation and ROI can be daunting. Manually performing these calculations not only cause data inaccuracies but have also become far too time consuming due to the growth of business operations and complexities.

Customer service - When visibility of an equipment item’s condition or availability is limited, it becomes difficult to manage customer interest. Further, routine processes such as creation of rental contracts or new customers can be time consuming. These add to delivery times, which adversely affect the customer experience.

Transforming the rental industry

Today's software providers are continually working with businesses to anticipate industry challenges in order to continue developing software solutions that will assist in combating concerns, while also paving the way for future technologies.

Implementing the right management software is one of the most effective ways of streamlining rental operations and ensuring long-term, sustainable growth. Below are some of the many benefits of adopting our latest in technology:

Improved visibility - System integration is a key component in ensuring business processes are seamless and that operational/performance visibility is accurate and available in real time. A properly integrated system will leverage information from one department to another while removing the need to de-duplicate data entry, thereby improving data accuracy.

Rental companies are now able to view detailed data about their equipment items such as location, availability for rent, utilization and condition status. It's easier to maintain equipment and arrange stand-downs when there are timely service and inspection check reminders. It's important that software provides the functionality to ensure relevant information can be forecasted and scheduled, keeping stakeholders proactively informed at all times.

The best systems provide businesses with the capabilities to view extensive, real-time utilization calculations via a wide range of graphs, tables and charts – and do so with the confidence of knowing it is an ARA Metrics certified software package.

Business intelligence - The offering of an extensive business intelligence tool will provide a true indication of how your business is progressing. Your system should be capable of showing real-time profitability, utilization and ROI, in a clear and concise graphical reporting tool. The ability to drill down on individual transactions and customer reporting for branch, equipment, category group, and class should also exist.

Real-time information can be used for advanced reporting on various aspects of the business including, project costing, lost sales, current and projected ROI, customer spend analysis, comparison of actual versus budget revenues by equipment, and much more. Management decisions become easier and more effective when based on precise reports obtained through cutting-edge analytics.

Rental efficiency - ERP systems coupled with mobile barcode and document scanning options, as-well-as modern e-signature features, speed up contract creation and delivery. Rental operators are able to view all the necessary information about an equipment item either before renting it, or on return. This can potentially eliminate rental counters, reduce delivery times and minimize conflicts.

Invoices can be raised faster, reducing the processing cost and cycle-times, while each transaction can be viewed as and when required.

The future is paperless

The once cumbersome procedures that previously took hours or even days, are now completed in a matter of minutes through automated workflows. Validation rules remove duplication and minimize errors, while inspection checklists are processed without endless paperwork. Critical information is now better protected from human error.

Software mobility - Rental business are no longer limited to office desks and warehouses.

Smarter ERPs are going mobile, making information and processes accessible anytime, anywhere. Procedures are now instantly completed on handheld devices, sales staff are engaging more dynamically with customers - offering quicker service, and closing deals faster.

Integrated mobility options empower businesses to perform company-wide procedures in the field, whether selling, servicing or renting. Through mobility technologies, Baseplan Enterprise users are now managing their entire rental process while in the field, as well as performing operator ticket entry, processing work orders for repairs/installations, tracking transport deliveries and much more.

It’s imperative for rental companies to adopt a management software that is comprehensive, flexible and sustainable. This is because the rental business is far more than renting – it is service and support through innovation.

*Based on IBISWorld’s Heavy Equipment Rental in the US: Market Research Report, May 2017 and forecast released by the American Rental Association (ARA)

 

 

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